Consequences of unfiled late tax returns

Most people know they will get into trouble because of their late tax returns, but they may not realize the serious consequences of late and back tax returns.

  • If you have unfiled tax returns and the CRA believe you owe taxes, they can freeze your bank accounts, garnish your wages, seize your car and sell your house.

  • You are charged a late-filing penalty up to 34% of the amount owed.

  • You have to pay interest on the amount owed, and the interest is compounding daily.

  • You could miss out on tax refunds, credits and benefits.

What happens if you still just do nothing? The CRA may wait several years then send a letter demanding that you file all your unfiled back tax returns in a short period of time. If you don’t respond on time, or didn’t receive the letter, the CRA can take harsh legal actions again you. Just remember, you can run, but you can’t hide.