CRA’s annual due dates for tax returns, penalties, and interest

Filling deadlines:

For Personal Returns (T1):

1. For individuals (T1 Return): April 30^th
2. If taxpayer or spouse (or common-law partner) carried on a business (self-employed): June 15^th

Tax filing and payment deadlines for deceased persons

3. If the death occurred between January 1^st and October 31^st inclusive, the due date for the final return is  of the April 30^th following year.
4. If the death occurred between November 1^st and December 31^st inclusive, the due date for the final return is 6 months after the date of death.

If the deceased or the deceased’s spouse or common-law partner was carrying on a business 

5. If the death occurred between January 1st and December 15^th inclusive, the due date for the final return is June 15^th  of the following year.
6. If the death occurred between December 16^th to December 31^st inclusive, the due date for the final return is 6 months after the date of death.

For Corporate Returns (T2):

7. six months after year end

Balance due date:

For Individuals / self-employed:

Deadlines for dues: April 30^th

For Corporate:

Deadlines for dues:

1. Two months after year end or
2. Three months after year end for certain Canadian-controlled private corporations (CCPCs)

Note: When a due date falls on a Saturday, Sunday, or public holiday recognized by the CRA, your return is considered on time if the CRA receives it or if it is postmarked on the next business day. Your payment will be considered received on time.

Interest on taxes you owe:

If you have a balance owing for the current tax year and don’t pay it by the April 30^th (payment due date), the CRA will start charging you compound daily interest as of May 1^st. This includes any balance owing if your return has been reassessed.

The rate of interest the CRA will charge on current or previous balances can change every 3 months based on prescribed interest rates.

Penalties:

The CRA may charge you a penalty if any of the following applies:

1. Penalty: Failure to file return by due date

a) Penalty for first occurrence:

Penalty is the total of:

1.  5% × unpaid tax
2. 1% × unpaid tax × number of months return is outstanding (not more than 12)

b) Penalty for subsequent occurrences:

Penalty is the total of:

1. 10% × unpaid tax
2. 2% × unpaid tax × number of months return is outstanding (not more than 20)

2. Penalty: Repeated failure to report income equal to or greater than $500 (more than once in any three-year period)

Penalty is the lesser of:

1. 10% × amount of unreported income
2. an amount equal to 50% of the difference between the understatement of tax (or the overstatement of credits) and the amount

3. Penalty: False statements or omissions, knowing or gross negligence

Penalty is the greater of:

1.  $100
2.  50% of the understated tax (Penalty may be waived if the taxpayer voluntarily tells the CRA about the amount that was not reported.)

4. Penalty: Misrepresentations in tax planning arrangements

Penalty is the greater of:

1.  $1,000
2. 100% of gross revenue derived by person from activity

5. Penalty: Participating in a misrepresentation

Penalty is the greater of:

1. $1,000
2. 50% of tax sought to be avoided (to a maximum of $100,000 plus the fee charged)

 (Source: CRA Website /Income Tax Act)

 

If you have any questions or any other tax and accounting issues, please feel free to reach out to Source Accounting. Source Accounting is an accounting firm in Mississauga, dedicated to small and medium size business, providing tax, accounting, bookkeeping, payroll solutions and etc. And if you find this post helpful, please let us know in your comments.

Disclaimer: The above contents are provided for the general guidance only, based on information believed to be accurate and complete, but we cannot guarantee its accuracy or completeness. It does not provide legal advice; nor can it or should it be relied upon. Please contact / consult a qualified tax professional specific to your case.