There are many reasons why people get behind on filing tax returns. Small business owners often have trouble assembling the records of revenue and expenses needed before a tax professional can prepare returns. Sometimes life gets in the way, with illnesses, marital issues, domestic upheavals…
Trouble is, once you fall behind on your tax fiings, getting caught up becomes a worry and chore. It’s all too easy to keep putting off until the Canada Revenue Agency steps in and starts demanding your overdue returns.
When that happens, don’t panic. And don’t rush off to any old tax preparer and send in several years of tax returns in one big batch. That may make the problem worse. Here are three important things to consider before you start catching up on your tax fiings:
- Filing multiple years, in a batch, is likely to have all your returns audited. You’ll need to make sure you have receipts for every tax credit or deduction you are claiming.
- Don’t gloss over income you think doesn’t matter. Little odd jobs that paid only a few dollars have to be reported. If the CRA discovers you have omitted income, however insignificant, it will impose penalties that can be as high as 50% of the total tax owing.
- If you think you will owe tax, you need a plan for how you will address payment on the balances you owe before you file. Balances for several years, plus late filing penalties and interest, add up quickly to one very big tax debt.
There is no quick fix for late filing returns. DioGuardi can help you file accurate returns, and help you plan how to pay the tax. Protect your money. Talk to DioGuardi before you file.
Call 1-877-4- DIO-TAX.