It?s not a pleasant situation and one you personally, as well as professionally, should try to avoid at all costs, because no matter how fervently you wish it would go away, unfiled tax returns will not be ignored by the CRA. This makes perfect sense as your government agencies are funded through tax dollars and need these monies to survive, as well as provide services to other individuals who do pay their tax bills.
These are just some of the scenarios that can occur with an unfiled tax return, blatantly incorrect or late tax return:
- Lending agencies such as banks normally insist upon financial paperwork like a tax return to illustrate your monetary situation. If you have unfiled tax returns or even a tax problem, this could adversely affect your credit and severely reduce your ability to receive a loan. Even if you can receive the money, it?s highly possible you will be paying an exorbitant interest rate that will never be reduced.
- Subsidies from the government like stipends for elderly residents or children will not be disbursed if you have unfiled or late tax returns. That means if your family needs these services they will not be available to them.
- Even if you only have a late tax return, the CRA will naturally assume you do not intend to pay your taxes. They have no intention of providing tax relief for you or your business.
- When the CRA unearths you have even one late return, they will issue paperwork called a notional tax assessment which will persist as a binding tax liability and could be more than triple, once all fees are tabulated, what you actually earn each year.
- An unfiled or late tax return may injure a work colleague, business associate, long-term partner, or husband or wife. The CRA has no qualms about assigning liability for your tax owing or linking it to people close to you financially. They want their money in some fashion even if it means ruining someone else?s financial stability
- Each year you do not pay taxes or have a late tax return the CRA will institute noncompliance fees, fines, and interest accrued on your tax bill. The CRA will double your bill every five years for each year you have not filed and this undoubtedly will cripple you financially for the rest of life.
- If you think shifting your assets and fund to another party such as your husband or wife, or a business partner, think again. This will place the person or persons in just as bad of a financial situation with the CRA as you are. Also, the CRA will require you to submit data on all that you have transferred, if you do not submit it, this is considered to be a criminal act and the CRA can move forward with this charges and prosecute you. They also have the same ability to apply the same treatment to the party or parties who remain in control of your financial assets.