Filing taxes in Canadais crucial, whether you are a business or an individual. All Canadians must file their tax returns each year. For instance, the citizen had to pay the tax returns by April 30th, 2022 for the financial year 2021. There is a set deadline each year to file tax returns, which needs to be met.
If a person fails to pay their taxes by the end of this due date, there can be serious consequences. This blog will help you understand what happens if you don’t file your taxes in Canada. Keep reading to learn more.
What Happens If You Don’t File Your Taxes In Canada?
Whether you file your taxes late or don’t file them at all, the implications can be severe. Therefore, it is beets to pay on time and don’t be late. If you are wondering about the implications of not paying taxes or paying them late, you are in the right place.
Although failing to pay taxes is not considered a crime, not filing tax returns is a crime as it is classified as tax evasion, which is a criminal offence. Plus, the penalties for a crime as serious as tax evasion are harsh.
As per Section 238 of the Income Tax Act, if you fail to file your tax returns, it can result in a fine of $1,000 to $25,000. Plus, you will also face up to one year in prison.
Moreover, according to section 239 of the Income Tax Act, a person charged for tax evasion has to pay a fine equal to half or double the amount they had avoided paying in the first place. In addition to the hefty fine, the criminals may also have to spend up to two years in prison.
Interest and Penalties
If you don’t file your taxes by the due date, the CRA will charge you a late penalty of 5 percent. Plus, you will have to pay an additional 1 percent every month until you file your tax returns. Moreover, the CRA will also charge interest on the taxes you don’t pay.
If you are looking for help filing your taxes online, Accounting Plus is your best bet. We have years of experience, and our accounting experts Markham are there to help you every step of the way.
Get in touch with us to learn more.