Canada: The Art Of Tax-Filing Deadlines

Last Updated: April 15 2019
Article by Samantha Prasad

So you think the tax-filing deadline is April 30? Seems straightforward enough. But remember, we're talking taxes here, so nothing is ever straightforward! Sure, the general rule is that if you are an employee, your tax return will be due April 30, 2019, for your 2018 tax year. But if you are self-employed, or even if you simply carry on a business in addition to being an employee, your tax return won't be due until June 15, 2019. And that's the just beginning. Read on for more about the intricacies of tax-filing deadlines.

If you have a business...

Notwithstanding the general April 30 deadline, if you carried on a business in the taxation year (subject to certain restrictions relating to the type of business carried on), you are given until June 15 of the following year to file a return. This later deadline is also extended to your spouse (including a common law spouse or partner, all of whom I'll refer to as "spouse" for the sake of simplicity).

However, if you and your spouse have been living separately for at least 90 days as of Dec. 31, 2018, by reason of a marriage breakdown, your spouse won't get the benefit of the extended June 15 filing deadline and must file by April 30 (which may not make you lose too much sleep, granted). Of course, if both you and your spouse carried on a business in the taxation year, you are each granted the June 15 deadline regardless of whether you are living together.

So why the extension? It relates to the fact that all individuals carrying on business are required to have a Dec. 31 year-end (or to pay tax as though they did). Corporations that have a year-end of Dec. 31 have until June 30 to file their tax return. So it only seems fair that if you are carrying on a business as an individual, you should get similar (if not exactly the same) treatment.

Of course, there are a couple of catches to be aware of. Even though you can file up to June l5, the CRA is not so generous as to let you off the hook from paying your taxes until then. April 30 will still be your "balance due date," meaning you have to actually cough up the money for any taxes owing on April 30, otherwise you will be charged with interest on unpaid taxes. It's not insignificant either – the current rate is 6%, compounded daily.

Even so, this deadline may be very helpful if you miss the April 30 filing deadline and you owe taxes.

The penalties

If you don't file your return on time (either by April 30 or June 15 if you qualify for the extended deadline), you will be subject to a penalty. The penalty is 5% of the tax unpaid when the return should have been filed, plus 1% of the tax outstanding at the time of the filing deadline, times the number of complete months (not exceeding 12) between the actual filing deadline and when you filed the return. In short, the maximum penalty is a whopping 17% per cent of the tax unpaid!

The penalty can be applied even if you file the return only two days late. This penalty is added to your assessment, and if you want to object, you have to actually file a Notice of Objection to the assessment. Note: If you have a habit of filing late, be aware that if you were charged this penalty for your previous three tax returns, the penalties are doubled for the 2018 tax year (10% of the tax owing plus 2% for each month outstanding).

Of course, if you are late filing due to circumstances beyond your control (e.g., you are hospitalized due to a serious illness), you can apply for leniency by making an application under the taxpayer relief provisions to have the penalties and interest reduced. The request should be made in writing and addressed to your Tax Services Office. Note: Even if you cannot pay your full balance owing for taxes by April 30, by at least filing your tax return, you can avoid this late filing penalty. So, don't hold off on filing your tax return just because you are not able to pay the taxes owing for the year.

If you find yourself unable to file by April 30, it may be particularly important to determine whether you qualify for the June 15 extension. It applies if you are a "consultant" – i.e., rather than being an employee for tax purposes, you are classified as an "independent contractor." The June 15 deadline will also apply if you carry on business through a partnership – even if you are a limited partner.

Delayed filing for some investments

Since many investments are structured as limited partnerships, this seems to open up the possibility that investors in these vehicles might be able to file on June 15. In fact, the rules seem to say that if you met the prerequisites at any time during the year, you're eligible for the extension. But if you invested in a tax shelter investment, you will not be eligible for the June 15 deadline. More specifically, if the expenditures made in the course of carrying on the business are primarily the cost or capital cost of tax shelter investments, or primarily tax shelter investments itself, you won't qualify for the extended deadline.

There are a lot of ifs, ands, or buts in this, and it can get complicated. So, it may be prudent not to claim the extension unless you're in a jam. However, if you have been assessed late filing penalties, these arguments may come in handy. It's always best to consult with your tax advisor.

And if your spouse does take advantage of filing by the June l5 deadline, you should be aware that this extension is not a family-wide benefit. If you have any children who file returns, those returns must still be filed by April 30. The extension for your spouse (if you are carrying on business) is granted mainly to facilitate compliance with the Child Tax Benefit provisions which requires filings by both spouses. Accordingly, the issue of whether you and your spouse are living together is determined under the Child Tax Benefit rules. Happily, the extension applies regardless of whether your spouse actually receives the Child Tax Benefit; for example, it applies even if you and your spouse have no children.

If you are not carrying on a business and cannot take advantage of the extended June 15 deadline, you're going to have to bite the bullet and file by April 30. This can sometimes result in a rushed filing and occasionally a mistake or two on your return. This error or omission can also result in either an increase or decrease to the tax payable to the government. However, the CRA prefers that you do not file an amended income tax return in these circumstances. Instead, you should write to the Tax Centre where you filed your return with an explanation and any additional material, such as T4 slips, T5 slips, and receipts. It is likely that CRA will also prefer that you include Form TI-ADJ to organize the presentation of your adjustment request in a convenient fashion. Correspondence with the CRA should include your Social Insurance Number or Identification Number.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Authors
Similar Articles
Relevancy Powered by MondaqAI
 
In association with
Related Topics
 
Similar Articles
Relevancy Powered by MondaqAI
Related Articles
 
Related Video
Up-coming Events Search
Tools
Print
Font Size:
Translation
Channels
Mondaq on Twitter
 
Mondaq Free Registration
Gain access to Mondaq global archive of over 375,000 articles covering 200 countries with a personalised News Alert and automatic login on this device.
Mondaq News Alert (some suggested topics and region)
Select Topics
Registration (please scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions

Mondaq.com (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of www.mondaq.com

To Use Mondaq.com you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.

Disclaimer

The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.

General

Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions