Filing Tax Returns Late Can Be Expensive
If you have a balance due for 2015 and you file your return after the due date, you will be charged a late filing penalty. The penalty for a first offence is 5% of the outstanding balance plus 1% per month up until 12 months. If you were charged a late filing penalty for 2012 , 2013 or 2014 the penalty will be increased to 10% of the 2015 balance outstanding plus 2% per month up until 20 months. Therefore, if you file the return 20 months late there will be a combined penalty of 50% plus interest. If you cannot pay the balance in full by April 30, 2016 you can avoid the late filing penalty if you file on time. Once the return is filed, a payment plan can be negotiated with the Canada Revenue Agency to avoid garnishments, liens and other legal action.