On that basis they can assess your tax debt, interest and penalties, and then proceed to collect the tax debt that they have estimated. When completing a Notational Assessment, the CRA will look at any information and make (often wild) assumptions. It can then use this assessment to calculate how much tax you owe. If you do not file, the CRA can complete a Notional or Arbitrary Assessment on your behalf and estimate your income, expenses, and other amounts. The CRA has very strong powers and once it knows that you are behind on your returns, it will use these powers to collect what it is owed. While it may not contact you immediately if you do not file your income tax returns on time, the agency will eventually discover that there is an issue.
The reality is that the CRA is a very large and powerful organization. Some people are under the mistaken belief that they can avoid filing their taxes and the CRA will not know that they owe money. This will make it incredibly difficult to pay the CRA what you owe and put significant stress on your budget.Įven if you cannot afford to pay your tax debt, you should still try to file on time so that you can avoid penalties. If you repeatedly file your taxes late (or not file them at all) these penalties will increase. You could even be subject to prosecution. The longer you wait and the longer your late tax filing is outstanding, the more you will accrue large penalties and interest. The CRA can charge significant late-filing penalties as well as interest charges on the tax debt that you owe. It is against the law to not file your tax returns.Įven if the CRA does not seek tax evasion charges against you, there are still possible ways that you can be hurt by filing taxes late in Canada. This can damage your reputation and your future.Īs mentioned, it is not against the law to have a tax debt and owe money to the CRA (Canada Revenue Agency). There are significant penalties for tax evasion, including fingerprinting, court-imposed fines, prison time, and a possible criminal record. By not filing income taxes when they are due, you are ignoring Canadian tax law and the Canada Revenue Agency could consider this to be an intentional attempt to evade taxes. Tax evasion is a situation where an individual or a business intentionally ignores Canadian tax law. Not filing a tax return = tax evasion = crime.Įach day that you are behind filing your returns, you could be considered to essentially be committing tax evasion. Most Canadians are required to file income taxes every year. It isn’t a crime to owe tax debt, but it is a crime to not file taxes if you are required to do so. If you are required to file a tax return, you must do so by law. What Happens if You Don’t File your Taxes in Canada? We’re the trusted experts that can assist you with your tax issue. The team at Farber Tax Solutions has years of experience in resolving tax problems.
#CANADA REVENUE AGENCY TAXES 2014 HOW TO#
If you’re curious how to file a late tax return Canada or how filing past tax returns Canada is possible, we can help. Not filing taxes when you are required to file them can be considered a crime, so it’s critical to file your returns, even if they are late and even if you cannot afford to pay your taxes. These two are different situations and the consequences of both are different. You may be wondering what happens if you don’t file your taxes in Canada or what happens if you file your taxes late.