Tax Deadline June 1, 2020 Quickly Approaching
Date: May 4, 2020
The deadline for filing your 2019 income tax return is extended to June 1st, 2020 and the deadline to pay is now extended to September 1st, 2020. There will be no penalties and interest if the amount is paid by September 1st, 2020 and the return is filed by June 1st, 2020.
The deadline for sole proprietorship and partnerships is still June 15th, 2020.
If you owe tax for 2019 and you file your return after June 1st, 2020, CRA will charge you a late-filing penalty. The penalty is 5% of your 2019 balance owing, plus 1% of your balance owing for each full month your return is late, to a maximum of 12 months. Therefore, at 12 months late, the combined penalty will be 17%. If CRA charged you a late filing penalty for 2016, 2017, or 2018, the penalty will be increased to 10% on June 2nd, 2020 plus 2% of your outstanding balance owing for each full month of your return is late, to a maximum of 20 months. Therefore, at 20 months late the combined penalty will be 50%.
In summary, if you cannot pay your full balance owing on or before June 1st, 2020, you can avoid the late-filing penalty by filing your return on time. CRA is presently charging interest at a rate of 6% compounded daily.
We would prefer that everyone email us their information. If you need to use postal mail to our office, we will have to receive them by May 11th, 2020 in order for us to complete your return on time. We will not start the return for one week after they arrive at our office. If you email us all your information, we will need everything sent to us by May 18th, 2020 to guarantee that your return is completed by the due date. If we do not receive your information by May 18th, we will not be able to guarantee that it will be completed by the due date, but we will try our best effort to complete it on time.
If you do not have a scanner and cannot email us your information, we have the capability of downloading a lot of information from CRA. We can then fill in the missing gaps through a phone meeting and then file your return. If slips are still missing after we file the return, then we can prepare an adjustment at a later date so that your numbers will reconcile with CRA. We have been working remotely since mid-March, and we have been meeting clients on Zoom. They have been reviewing their returns online with us before we send them to CRA.
Temporary Wage Subsidy
CRA has produced a temporary wage subsidy on income taxes withheld on payroll not CPP and EI. The subsidy can only be used by Canadian Controlled Private Corporations. This is only for existing payroll account not new accounts set up. CRA is applying a subsidy for wages paid to employees between March 18, 2020 and June 20, 2020.
Canada Emergency Wage Subsidy
The federal government has announced a wage subsidy to cover 75% of salaries for businesses that qualify for up to 3 months. The subsidy is retroactive to March 15, 2020. The purpose of the wage subsidy program is to help employers that have been hurt by the Covid-19 pandemic and that there is an incentive to keep workers employed.