Back taxes or tax problems?
Back taxes or tax problems?
Filing your income tax return on an annual basis relieves you of your income tax burden for that particular year. You did your homework and satisfied your legal requirement of reporting your income to the government. However, what if you have neglected to file some of your tax returns or have omitted income? If this happens, you are responsible for the unpaid tax and back taxes on the unreported taxable income and to pay the tax for the unfiled tax returns. In addition, harsh penalties and interest may apply for unpaid back taxes.
The situation described above refers to back taxes. If you owe tax from a previous period, you have back taxes. You can also have back taxes if you failed to report income or claimed tax deductions / tax credits erroneously. The Canada Revenue Agency (CRA) can reassess your income tax return and send you a tax bill for unsubstantiated tax deductions or tax credits. Accuracy Plus specializes in back tax resolution, saving you money and aggravation. Let Accuracy Plus deal with the CRA on your behalf.
Quick facts about back taxes
- You are legally required to file personal tax returns if you have taxes payable or you receive a request to file income tax.
- Back taxes have a higher risk of a tax audit. The longer you wait to get your back taxes done, the more penalties you face and complex the solution.
- If you are behind in filing your income tax returns, you could be subject to interest and penalties on overdue balances (back taxes etc.).
- The tax department can garnish your wage, freeze your bank account, seize assets to collect overdue back taxes.
- Preparing your income tax returns on a timely basis reduces your risk of a tax audit.
- Get your income tax return done each year. You can avoid interest and penalties on overdue back taxes owing.
- The tax preparation process allows the tax department to calculate your RRSP contribution room each year. Accordingly, you can take advantage of contributing to your RRSP, receive a tax deduction on your income tax return and reduce your tax bill.
The Penalty Possibilities
The normal reassessment period is three years from the date your return is initially assessed. Consequently, the Canada Revenue Agency (CRA) is usually not allowed to adjust past this period. The period beyond the three year normal assessments is statute barred. However, in some situations, CRA does adjust or attempt to adjust beyond this period. If CRA can demonstrate that the taxpayer has made a misrepresentation, willful or otherwise, in preparing an income tax return or providing information, then they will argue that an adjustment is justified.
For example, unreported taxable income or tax deductions claimed without supporting receipts could provide evidence for misrepresentation. This type of behaviour could warrant the CRA opening years prior to the normal reassessment period. This opened tax window could lead to a significant back tax bill and time consuming personal inconvenience along with associated expenses.
What should you do?
One of the most obvious things to do is file your income tax return each year. Not an earth shattering comment, but full of common sense. To assist in this endeavour, you should hire the professional tax preparers at Accuracy Plus to ensure you capture all your tax deductions, tax credits and structure your financial affairs in a tax efficient manner. The tax preparers and financial advisors at Accuracy Plus will help relieve the stress and prevent future back tax related issues.
The tax preparers at Accuracy Plus are here to help you navigate the dangerous tax waters to a safe landing. Give the tax preparers at Accuracy Plus a call, and they will throw you the tax lifeline needed to save you from unnecessary back taxes and penalties. You can count on Accuracy Plus for all your back tax requirements.
Benefits of Accuracy Plus back tax assistance
- Free financial review: With the preparation of a tax return, Accuracy Plus will provide you with a free financial needs analysis i.e. tax planning, investment return review etc.. Integrated tax solutions can make a positive difference to your financial planning.
- Expertise: Accuracy Plus can provide you with the advice you need to retire early, plan for your child’s higher education, investments, back taxes etc.; all with a tightly integrated tax strategy to help save on the taxes you pay now and into the future.
- Efficiency: Accuracy Plus can provide multiple services. This can save you time and money; one financial advisor / tax preparer to help you with your tax, investments, mortgages, and insurance.
Do you have a problem with back taxes or need tax audit help? Relax, Accuracy Plus can help!
Get your back taxes done now and get the tax department off your back! Relax with the help of the professional tax preparers at Accuracy Plus. Accuracy Plus has helped many satisfied clients with their back taxes; we would welcome an opportunity to help you with your back taxes.
Take care of your back taxes and minimize the future taxes you pay. Call us today, A professional tax preparer is ready to take care of all your back taxes and tax problems. Accuracy Plus has two convenient locations in Kingston, and Napanee to serve you.
