Filing Considerations for the 2022 Tax Year
There are various deadlines for filing and paying taxes in Canada for the 2022 tax year.
Mar 1, 2023 Last day for 2022 RRSP contributions
Mar 15, 2023 Due date for tax instalments for 2022 (see below)
Feb 28, 2023 Last day for filing T4s for employees, and T5s for dividends paid
Mar 31, 2023 Last day for filing GST returns and paying the amount due for annual filers and Due date for 2022 company tax payments
May 1, 2023 Due date for filing individual tax returns in Canada, including form T1135 re Foreign Income and Due date for payment of taxes by individuals, including self employed individuals
Jun 15, 2023 Due date for self employment tax returns
If an individual owed more than $3,000 in 2021, the CRA will require that they pay instalments/prepayments against their future 2023 tax obligations. They will send a notice requiring you to make quarterly instalments (the amount owing divided by 4) on Jun 15th, Sep 15th, Dec 15th and Mar 15 of 2023. Failure to make these instalments will trigger compound interest, thereby increasing the amount owed. You can choose the pattern of instalments. based on the taxes owing in 2021/2022, or based on 2022 (current year) or based on an estimate for the following year (2023). Please let your tax prepared know which option you would prefer, so that can be clarified in the submission of your taxes
If an individual is self-employed, there is more time to file, i.e. June 15, 2023 vs May 1st. However, the payment of taxes must be made on or before May 1, 2023, just like all other individual taxpayers. This means that is critical to work with your tax professional before May 1st to estimate (and pay) your taxes for 2022.
If a taxpayer is owed a refund, there are no late filing penalties. However, clients should be aware that the CRA may not allow all of your claims, in which case they will re-assess your original tax return submission and you may owe late filing penalties and accrued interest on the re-assessed amount owing. Typical claims that are disallowed include but are not limited to a) moving expenses; b) various medical and therapeutic expenses; c) taxes paid to a foreign country; and d) various employment expenses not supported by a signed T2200 Conditions of Employment from your employer and/or not supported by physical receipts; and e) claims for interest paid on foreign student loans. If you are unsure about whether your claims might be qualified, please ask your tax professional
If you file after the deadline, then the amount owing will be subject to a 5% late filing penalty plus an additional 1% for each full month you file after the due date, to a maximum of 12 months. If the CRA charged a late-filing penalty for 2019, 2020 or 2021 and requested a formal demand for a return, your late-filing penalty for 2021 will be 10% of your balance owing. You will be charged an additional 2% for each full month that you file after the due date, to a maximum of 20 months.
If you have outstanding debts to the CRA, they will charge you compound daily interest (interest on interest). If you owe taxes for the 2022 tax year, and you don’t pay by May 1, 2023, then the CRA will charge you interest starting on May 2, 2023. This includes any balance owing if your return has been reassessed.
You can make a request to the CRA to cancel or waive penalties or interest if you are unable to meet your tax obligations due to circumstances beyond your control, e.g.
- extraordinary circumstances;
- actions of the CRA;
- inability to pay or financial hardship;
- other circumstances
The CRA can only grant relief within a 10 year span from your request date.
Please call Randy Larson at 604 558 2234 or book a Zoom meeting to learn more.