This page provides information (including a table of penalties and frequently asked questions) about penalties for late or improperly filed forms and information returns.
The penalty for failing to file a return is $25 per day for up to 100 days (minimum $100 and maximum $2,500). This penalty does apply to Form T1142.
When failing to file is done knowingly or under circumstances amounting to gross negligence, the penalty is $500 per month for up to 24 months (maximum $12,000), less any penalties already levied. This penalty does not apply to Form T1142.
After 24 months, the penalty is 5% of whichever of the following resulted in the requirement to file the information return, less any penalties mentioned above already levied:
The CRA may issue a demand to file a return to a person or partnership under subsection 233(1) of the Income Tax Act. If so, and if the person or partnership knowingly or under circumstances amounting to gross negligence fails to comply with the demand, the penalty is $1,000 per month for up to 24 months (maximum $24,000), less any penalties already levied. This penalty does apply to Form T1142.
A penalty applies to people who knowingly or under circumstances amounting to gross negligence make false statements or omissions in an information return.
For Form T1142, the penalty is the greater of either:
For the other information returns, the penalty is the greater of either:
The penalty for omissions on Forms T1134 and T1141 does not apply to taxpayers who make diligent efforts to get the requested information and who:
The Canada Revenue Agency (CRA) is committed to putting people first and providing the income support that Canadians need during the COVID-19 pandemic.
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Interest relief will be given to individuals who meet all of the following:
You meet the above criteria. The CRA will automatically apply interest relief on your 2020 taxes owing until April 30, 2022.
If you meet all eligibility criteria and have filed your 2020 tax return, the CRA will automatically apply interest relief on your 2020 taxes owing.
You will not have to pay interest on any amount owing from your 2020 taxes until April 30, 2022.
Interest relief only applies to your 2020 taxes owing and not on previous or other debts with the CRA.
File your tax return by the due date. If you file late, you will be charged a 5% late-filing penalty on top of what you already owe, plus an additional 1% for each month (up to a maximum of 12 months).
Interest will start after April 30, 2022 on any amount owing for the 2020 tax year.
The CRA can work with you and find flexible options to pay your balance owing. Find ways to pay your 2020 taxes owing.
Is the 5% penalty for failing to file Form T1135 levied per year?
The foreign-reporting requirements provide for significant penalties for failing to file information returns by the due date. These penalties apply whether or not the person later becomes a non-resident.
If a person becomes liable for these penalties and doesn’t pay the amount owing, we will start our usual collection action.
The penalty for failing to file any of the foreign reporting information returns is the greater of either $100 or $25 per day for each day that the return is late (maximum of $2,500).
When a person fails to file an information return (except for Form T1142) knowingly or under circumstances amounting to gross negligence, the penalty is $500 per month for each month that the return is late (maximum of $12,000), less any penalties already levied.
If the CRA issues a demand for the return, and if the person fails to file the information return knowingly or under circumstances amounting to gross negligence, the penalty is $1,000 per month for each month that the return is late (maximum of $24,000), less any penalties already levied.
If a person, knowingly or under circumstances amounting to gross negligence, is late with a return by more than 24 months, an additional penalty is imposed, less any penalties already levied, of either: 5% of the cost of the property, the cost of the shares, and the indebtedness of the foreign affiliate; or 5% of the fair market value of the property transferred or loaned to the non-resident trust.
If a person who has to file Form T1134 or Form T1141 can show that, despite exercising due diligence, some or all the required information cannot be obtained, the penalties may be waived. If the person obtains the information later, it must be filed no later than 90 days after the person gets the information.
The 5% penalty is levied when the failure to file for a year is done knowingly or under circumstances amounting to gross negligence.
For example, if a person fails to file for the 2018 tax year and the failure continues for more than 24 months, the 5% penalty will be levied on the cost amount of foreign property owned in 2018. The 5% penalty is levied only once and is not per year.
If the same person continues to own the foreign property in 2019 and again fails to file the information return for a period of more than 24 months, the 5% penalty will be levied on the cost of the property that should have been reported for the 2019 tax year. The penalty for 2019 is separate from the one in 2018.
If the person owned no foreign property in 2019 for which Form T1135 was required to be filed, there would be no additional penalty.
For purposes of the 5% penalty, the cost of foreign property is the cost amount of the property, as defined in subsection 248(1) of the Income Tax Act.