What are Tax Payment Plans and How Should They Be Handled
Posted by support2 March 03 2014
Tagged Under : cra garnishment, cra tax payment plan, garnishments
There are often times when a taxpayer has a huge tax owing which he is unable to pay. This can also be a result of years of accrued interest on your original tax amount. Many times tax amount keeps on growing through time and turns up in a huge amount which you are unable to pay. Some people sighting this case and prepare filing of tax returns as they know the monster of the tax owing will soon grow out of their control. Once this monster gets out of control what you will be facing is a financial crisis and what you will be doing is preparing for a tax payment plan.
The tax owing is owed once an individual files returns. Inability to pay tax owing results in serious financial troubles. In order to escape legal actions people go after devising a tax payment plan, however designing this plan directly with the CRA can spell DOOM for you. This is so because not only will the CRA attempt to consider and accept a short term tax payment plan from you, they will also always want disclosure of significant financial information. This information can include where you live, work and where you bank. These details are taken in an attempt to be used later after your tax payment plan expires. If you miss any payment again thereafter, CRA using the prior information, attempts to enforce action on your bank account, home, and on your income using it to force the taxpayer to pay the entire tax owing.
The best way to handle this situation is to consult tax expert such as Tax SOS who can efficiently design a tax payment plan for you and negotiate on your behalf with the CRA. Our experts are also able to host financial resources for those who require financial relief in wake of paying off their tax owings.
Also when it comes to devising a tax payment plan it is also recommended that you should never agree to pay a monthly amount that you cannot afford. Doing such a thing will only add up to your problems. In case of failure to pay the agreed amount monthly, serious actions can be taken by the CRA in form of income garnishments. This refers to the CRA taking over your bank account and deducting the decided amount monthly to collect all due tax owing from its taxpayer.
Hiring the services of tax experts will help you devise a tax payment plan that is workable for you and will also ensure that the clients are least exposed to the CRA. Remember it is necessary to devise a sound tax payment plan as anything wrong in this initial step may mean losing the battle for ever and even before you started it. Failure to pay taxes can result in serious consequences and promising payment on a schedule and still failing to do so will lead to even worse repercussions.
Tax payment plan is the option taken by taxpayers when they are unable to pay all their taxes in full. Tax payment plan helps individuals to pay their taxes off in installments however devising a proper plan is necessary as failing to pay the installments according to the devised plan can result in garnishments of wage or income.