Phone Phone

Interest & Penalties on Back Taxes

Where taxpayers are indebted to the CRA by owing back-taxes, the CRA will tack on interest on the overdue amounts at the rate of 6% per annum, compounded daily. The exact rate of interest can change quarterly and the CRA maintains an updated list, which can be found at the following CRA webpage: http://www.cra-arc.gc.ca/tx/fq/ntrst_rts/menu-eng.html .

In some circumstances, the CRA will also levy penalties against the taxpayer in relation to the tax debt owed. This quite rapidly causes tax debt to balloon to insurmountable proportions.

Taxpayer Relief Applications

There are means to reduce or eliminate the penalties and interest that have been levied, enabling the taxpayer to pay the principal balance only. This can be achieved through a Taxpayer Relief Application.

In order to qualify for the taxpayer relief program, however, one must demonstrate that there are extenuating circumstances that have hampered his ability to pay. The CRA will allow your application only if you meet one of the three categories of factors:

  1. CRA in action or inaction;
  2. Financial inability to pay the CRA debt;
  3. Extraordinary circumstances such as a fire, flood, illness or death in the family.

Why you Need a Tax Debt Relief Lawyer

Our tax debt relief lawyers understand which criteria need to be satisfied for your taxpayer relief application to be accepted by the CRA.

If you have been charged tax penalties & interest in addition to your principal tax debt, contact our tax debt relief lawyers today. We will discuss your personal circumstances and determine whether you qualify for a reduction of your tax penalties & interest. If you do, we will prepare a robust application to reduce the tax penalty and interest portion of your debt significantly.

Been levied tax penalties & interest? We’re here to help™.

Insights

Business Contracts |Enforceable Contracts

What is an Enforceable Business Contract? An enforceable business business contract is essential to conducting a business. Done right, they provide peace of mind and clarity to both parties. When

Continue Reading
Read More...
GST/HST Account Registration, Collection, and Remittance

GST/HST Account Registration, Collection, and Remittance A goods and services tax (GST) number is a unique tax identification number assigned to a business by the Canada Revenue Agency (CRA). It’s

Continue Reading
Read More...
Pay Less Tax on Your Home-Based Business

Pay Less Tax on Your Home-Based Business Is your home where you principally conduct your business? Do you spend most of your business working hours at home? Is your home

Continue Reading
Read More...
Close Menu

Book an Appointment 1-800-631-7923

Speak with a Lawyer
1-800-631-7923

Email Us
[email protected]