Many people who avoid preparing their tax returns are afraid they will owe money. And sometimes, you complete the calculations and you owe more money than you expect. Here are three tips if you owe and can’t pay:
- Even if you can’t pay, file your return on time: this avoids the late filing penalty .
- You may not be able to pay the entire balance, but make some kind of payment to keep down the interest charges.
- Contact the Canada Revenue Agency to make payment arrangements. This will avoid them taking legal action.
Hiding from the CRA is not a good plan. And quarterly benefits like the GST/HST can be used to pay your tax debt. If you demonstrate you intend to pay, life will be easier.