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If you made a late instalment payment, or paid less than the required amount, you may be able to offset interest and penalties by earning credit interest. You can earn credit interest by paying your next instalment payment early, or by overpaying your next instalment.
- Overview
- On this page
- Interest on taxes you owe
- Penalty for filing your tax return late
- Request to cancel or waive penalties or interest
You will be charged interest on any taxes that you owe if you pay late. You will also be charged a late-filing penalty if you file your tax return late and have a balance owing.
If you have a balance owing for 2023 and are unable to pay it by the April 30 payment due date, the CRA will charge you compound daily interest starting May 1, 2024, on any unpaid amount owing for 2023. This includes any balance owing if the CRA reassesses your return.
•If April 30 is on a Saturday, Sunday or public holiday
When the due date falls on a Saturday, Sunday or public holiday recognized by the CRA, your return is considered on time if the CRA receives it or if it is postmarked on or before the next business day. Your payment is due by the first business day after April 30. For more information, see Due dates and payments dates. Interest on your balance owing begins to accrue on the second business day.
The interest rate that the CRA charges on current or previous balances owing can change every three months based on prescribed interest rates.
If you file your tax return after the due date and have a balance owing, you will be charged a late-filing penalty. Filing late may also cause delays to your benefit and credit payments.
If you cannot pay your balance owing, you should still file on time to avoid being charged the late-filing penalty.
The late-filing penalty is 5% of your 2023 balance owing, plus an additional 1% for each full month that you file after the due date, to a maximum of 12 months.
If the CRA charged you a late-filing penalty for 2020, 2021 or 2022 and requested a formal demand for a return, your late-filing penalty for 2023 will be 10% of your balance owing. You will be charged an additional 2% for each full month that you file after the due date, to a maximum of 20 months.
You can make a request to the CRA to cancel or waive penalties or interest if you are unable to meet your tax obligations due to circumstances beyond your control.
The CRA can only grant relief within 10 years of your request date.
You may have to pay a penalty if your instalment payments are late or less than the required amount. The CRA applies this penalty only if your instalment interest charges for 2024 are more than $1,000. To calculate the penalty, the CRA determines which of the following amounts is higher.
Jun 16, 2023 · Interest is calculated starting on the latest payment deadline date specified by the CRA for the given tax year (aka roughly the end of May—if you file on time), the 30th day after you file your tax return (if you file late), or the day after you overpaid your taxes.
Feb 28, 2023 · For those who tend to procrastinate, here is what you need to know about interest and penalties if you don't file and pay your taxes by the deadline. INTEREST PAYMENTS. The Canadian Revenue Agency...
Apr 22, 2024 · Is there a penalty for filing taxes late? If you file your taxes late and owe money, the CRA charges you a penalty on the taxes owed. The first time you are late on your taxes, the CRA interest rate on your balance owing is 5%, plus an additional 1% percent for each month they’re late—up to 12 months.
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Mar 9, 2021 · If you owe a balance but file your return, you will be subject to interest fees until your balance due is paid off. If you have a balance owing and you file late, you’ll be subject to interest and a penalty. CRA assesses this extra penalty from the first day your return is late.
