What Happens If I File MIf you file taxes late in Ontario, you may be open to interest and collect penalties. Starting May 3, 2022, the CRA will begin charging compound daily interest on your taxes owing. The interest rates are subject to change every 3 months.
If you do owe taxes for 2021, the CRA will require you to pay tax installments. You must pay the balance owing on the payment date. If you miss a payment, you will incur the interest.
Additionally, there is a fee for late filing. For 2021, the late filing penalty is 5$ of your balance owing, plus an additional 1% for every full month you file after the due date, up to 12 months. Not to worry, if you can’t pay your taxes by the deadline, you should still file to avoid this fine. The late payment penalty on tax installments only applies if your interest charges for 2022 are more than $1,000 CAD.