As you may have noticed, this year there has been a change in the date to file your 2013 return and pay any balance owed due to the 5 day service disruption last month.
Many of us are late in sending their tax returns due to lack of time or lack of knowledge regarding the completion of the tax return.
And, according to Annie Boivin’s article, which appeared in lesAffaires.com, in April 2014, Annie mentions the interest on taxes which are more important than a credit card.
Did you know that the interest rate on your tax can go up to 16%?
Did you know that the tax authorities charge you when your return is sent late?
Its rates are seriously to be taken into consideration!
According to the study carried out in this article, many of us do not know the harmful effects if we do not complete our tax return on time!
In addition, the tax authorities impose several penalty rates: – in the event of delay: 5% penalty on the amount owed to them, to which is added an additional penalty of 1% per month of delay for a maximum period of 12 months – in the event of unpaid taxes payable : 6% which corresponds to the annual interest rates compounded daily as of May 6, 2014 on the unpaid amount for 2013.
Annie Boivin gives an example to allow you to view the interest rate in the event of late payment: when you file your tax return one year late and a tax balance of $ 1,000 remains unpaid for a whole year, your debt to the tax authorities will amount to $ 1232, or the equivalent of an interest rate of 23%! It’s way too much!
It’s not over yet! Other penalties are added! In fact, Quebec requires an additional interest rate of 10% per year for payments not made. However, if you had previously made a monthly payment equal to or greater than 90% of the amount owed, the interest rate will be 16%.
While, the federal government requires payment of the difference if it exceeds $ 25, in the event of late payment of installments.
Did you know that there are penalties for repeated failure to report income?
Indeed, according to the article on interest and penalties published on the Government’s website, if you forget to include in your return an amount that you had to declare and that you made this mistake many times over. prior years, federal and provincial and / or territorial penalties will be 10%.
Did you know that there are penalties for misrepresentation?
According to the article published on the website of the Canada Revenue Agency, the penalty is estimated at $ 100.
In conclusion, the interest rate on late filing taxes is significantly higher than the interest rate on credit cards. A late payment of installments costs much more in Quebec! It is therefore imperative to produce and pay your taxes on time. Do not hesitate to consult the following link concerning the prescribed interest rates .