By now, as a Small Business Owner you are way into your spring cleanup plans from filing and paper work to updating computer system to changing office furniture. But while you are doing that, have you giving some thought to outstanding tax filing of prior years?
This will need cleanup also. Why not put the breaks on and attend to those more critical issues first? Outstanding taxes filing could cause you and your company much headache in the form of interest and penalty.
Interest and Penalties:
Interest: If you did not pay your 2008 taxes on time or if there is a balance owing for 2008 on your notice of assessment, CRA will charge compound daily interest starting May 1, 2009, on any unpaid amounts owing for 2008.
If you have amounts owing from previous years, CRA will continue to charge compound daily interest on those amounts. Payments you make are first applied to amounts owing from previous years.
Late Filing Penalty: The penalty is 5% of your 2008 balance owing, plus 1% of your balance owing for each full month that your return is late, to a maximum of 12 months. If CRA charged you a late-filing penalty on your return for 2005, 2006, or 2007 your late-filing penalty for 2008 will be 10% of your 2008 balance owing, plus 2% of your 2008 balance owing for each full month that your return is late, to a maximum of 20 months. This information can also be found on the CRA (Canada Revenue Agency) website.
If you happened to file your return late for reason beyond your control. You might be able to get interest and penalties waived or reduced under the taxpayer relief provision.
At Williamson Accounting we can put you on the right track by bringing your Personal and Corporate Tax filing up to date. Give us a call or send us an email to request a free initial consultation.