In business, the paperwork can be overwhelming to say the least. We find many clients will put paperwork in order of importance. This makes sense.
However, sometimes there are consequences that you do not anticipate. For example, we see clients that do not owe tax on a tax return decide to wait and file it when they have more time. This can have nasty consequences. Let’s say for example that your business decided not to file its corporate tax return when it was due six months after the year end. Let’s also say that you know with certainty that your corporation has already paid enough taxes so filing late will not trigger a penalty. What you do not necessarily know is how this will affect your other filings with Canada Revenue Agency. There is a rule in place that says in short, “if you miss one filing for one department, then all departments will hold back refunds until all filings are up to date”. So let’s say your business is expecting a GST refund. Well, that GST refund will be held until the corporate return is filed and assessed. This can mean a delay of many months if you are expecting a refund.
Worse yet, if you get very late on filings, Canada Revenue Agency can take matters in their own hands and file tax returns with estimated numbers. These returns will still not release the held funds, instead they will add to the amounts considered owing and make it even less likely that you will receive a refund when you file a tax return that indicates a refund.
Contact us at partner@gilmour.ca or www.gilmour.ca
We are Professional Corporate Tax Accountants / Advisors
Chartered Accountants serving Langley, Surrey and Abbotsford British Columbia
