Sometimes life gets in the way. It prevents you from meeting your responsibilities as a business owner or the director of a charitable organization. It happens. If you are behind on your corporate taxes (or maybe you’ve never filed a corporate tax return), it’s always best to get caught up then try your best to stay on top of things.
The Canada Revenue Agency (CRA) has a number of programs available to help make getting caught up a little easier.
Voluntary Disclosure – Corporate Taxes
The CRA Voluntary Disclosure Program provides an opportunity for taxpayers to correct a misfiled return or file a return that was never filed. While taxes and interest on late payments are still due, under this program, the CRA will waive penalties that would normally arise.
Taxpayer Relief Program – Corporate Taxes
The taxpayer relief program helps taxpayers that may find themselves in special circumstances. You can use this program if you were unable to file your tax returns due to something outside your control such as a fire or flood.
The Canada Revenue Agency assesses taxpayer relief on a case-by-case basis. If your application for taxpayer relief is accepted, the CRA may waive interest and penalties, however, any tax owing will remain your responsibility. Taxes are a fact of life that provide for a number of public benefits. There really is no way to avoid those!
The CRA is pretty reasonable when it comes to setting up payment plans if you find yourself unable to pay the full balance of tax owing.
Non-Filer Program – Corporate Taxes
The purpose of this program is to help you stay on track in the first place. Taxpayers are encouraged to file their tax returns voluntarily. If they fail to do so, the CRA has a right to enforce compliance under the Canadian Income Tax Act. Compliance can be enforced by the CRA by demanding returns, initiating field visits, and/or assessing an amount owing.
Often when CRA does an arbitrary assessment, the amount owing is more than it would have been had you filed your corporate taxes. (Another reason to stay on top of things.) Once you file your return, the CRA will adjust your tax owing to the actual balance.
The BC Corporate Registry
The BC corporate registry is separate from the Canada Revenue Agency. If you haven’t filed your corporate registry documents in the last three years, your company is in danger of being struck from the corporate registry. This can have serious consequences when it comes to filing your corporate tax or non-profit information return.
The BC registry office supports the legal framework for running a company or organisation. Think of it as keeping the public safe and companies and charitable organisations accountable to the public. You must file an annual report with the BC registry office every year to maintain current standing as a corporation or charitable organisation. (1)
At Virtual Heights Accounting, we have experience filing overdue tax returns. To find out if you qualify for either the Voluntary Disclosure or Taxpayer Relief Programs, contact us for more information. Even if you’ve never filed a tax return, we can help.
(1) Please note, we don’t file corporate registry reports here at Virtual Heights Accounting. Check with your lawyer or notary.