Canada's tax deadline is soon and here's how filing late can cost you money
Tax experts reveal what you need to know! 👀
Pile of Canadian money.
Have you filed your Canada taxes yet?
With the tax deadline approaching, Narcity spoke to tax experts to find out how filing late can make you miss out on money from the government and cost you money.
If you're employed, the deadline to file taxes in 2024 is April 30 and that's also when you have to pay any tax you owe.
If you're self-employed, the filing deadline is June 15 but you still have to pay your tax owing balance by April 30.
Narcity chatted with Gerry Vittoratos, a national tax specialist at UFile, and Stefanie Ricchio, a CPA and spokesperson for TurboTax Canada, to get all the details on Canada's tax deadline.
Since not filing your return by the tax deadline is one the biggest tax mistakes you could make that will cost you money, here's what you need to know about it.
Tax refund
Vittoratos said that if you're getting a tax refund, there aren't any penalties or interest for filing late.
However, your refund will be delayed so if you need the money you will "miss the opportunity to put the refund to good use" by filing late.
When it comes to filing on the day of the tax deadline, Vittoratos revealed how that could also cost you money by delaying your refund.
"There might be glitches in the government's systems at that time that might delay the processing of the tax return, and consequently delay everything else," the tax expert said. "It's not worth taking that risk, file well before the deadline."
Federal benefits
"Delaying the filing of your tax return can impact and delay benefit payments from the government," Ricchio said.
Both Ricchio and Vittoratos noted that federal benefits like the Canada Child Benefit, GST/HST credit, Advanced Canada Workers Benefit and Guaranteed Income Supplement are tied to your tax return.
"You delay your tax return, you can delay your payments," Ricchio said. "You can stop your payments."
Even if you file right at the tax deadline, "you're in that influx of late" especially if you're not filing online, according to Ricchio.
"You have to file your tax return on time to give the proper time to the government to process the tax return," Vittoratos said.
Owing taxes
If you think you'll owe taxes or are worried about having enough money to pay if you end up owing taxes, Vittoratos recommended filing your 2023 tax return before the deadline.
"It gives you the time to be able to amass the funds you need in order to pay your balance owing and avoid paying interest on any unpaid balance by April 30," the expert said.
Late penalties
"The importance of the deadline is to make sure that you don't pay any penalties and interest if you owe money to the government," Vittoratos said.
Filing your tax return late means you'll get late penalties added to the money you owe because the filing deadline is also the payment deadline.
Vittoratos noted that the penalty for filing late is 5% on your balance owing and then an additional 1% for every month you're late.
Interest
Vittoratos and Ricchio both warned against filing late because of the interest you'll incur — in addition to late penalties.
"If you have a balance owing, you will be subject to penalties and interest on the balance owing," Vittoratos noted.
"The interest rate is now 10% on your unpaid tax balance and that's significant," Ricchio said.
When you think about that interest and any additional penalties, the cost will add up and "feeds into what makes taxes so overwhelming for people," she continued.
"The more we reinforce the importance of getting these things done on time, the better off everyone will be," Ricchio said.
This interview has been condensed and edited for clarity.
This article's cover image was used for illustrative purposes only.