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Avoid the Downfalls of Late Tax Filing

If you are late filing your taxes in Canada there is no need to worry that you are the only one. Many people miss the deadline and it is for a variety of reasons. Sometimes there is the belief that nothing is owed and so do not have to put in a return. Some people will know that they will need to pay tax, but think that if they don’t put in a form they will seemingly disappear from the records and get away without paying – this will certainly not happen. Late tax filing can also happen if you know you need to pay but are not able to find the money.

While late tax filing means you have to pay a penalty it is also serious and is classified as a crime, meaning that there will be time and effort put into sorting the case out and presenting you with the bill. If you have not been able to access receipts and records, you still need to get in touch with the authorities and come to an arrangement. Late tax filing could mean that you are rushed when you least need to be so the ideal solution is to use the services of a qualified tax consultant who has plenty of experience when it comes to tax returns and late tax filing.

The longer you ignore the situation and don’t put in your return, the longer you are breaking the law. End the late tax filing problems by submitting your tax returns as soon as you can. Owing tax is not illegal, so it is best to file and then let your representative arrange a payment plan – or even better – a reduction in what is owed by way of the removal of interest and penalties.

If you do not put in the return on time, it is going to be estimated and the figure that the CRA come up with may be a lot higher than it should be. You will then be left trying to figure out the correct figure and all because you have late tax filing issues and have not submitted the correct details to the CRA. If you do not manage to get your representative to slow down the process and negotiate the affordable tax payment plan for you, there may be legal sanctions put in place and it will be difficult for you to carry on your day to day life.

Regardless of how far behind you are with late tax filing the problem will not go away. It may just be a year but could be as far back as ten years and the tax debt is still there. The late tax filing penalties are 5% of what is owed for first time offender, and over time this can add up to a substantial figure. Added to this will be another fee of 1% for each month that the payment is late and this will last for 12 months and compounded daily interest. If you have been late tax filing in the past three year, the penalty is going to be higher.

Tax Court CRA Tax Appeal Case for Small Business

The following is a typical tax appeal case in the tax court. This tax court case demonstrates how small business owners can run into problems with Canada Revenue Agency for nearly two decades of legal battle.
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Date: 2011-03-03

741290 ONTARIO INC., vs. HER MAJESTY THE QUEEN,

AMENDED REASONS FOR JUDGMENT

[1] These appeals were begun under the informal procedure of this Court, to challenge the correctness of some 94 unspecified assessments made under the provisions of the Income Tax Act (the Act),[1] the Employment Insurance Act[2] and the Canada Pension Plan[3] in respect of amounts required by those statutes to be withheld from wages paid to employees of the appellant between April 1992 and July 1999.

[2] By the Order of Rossiter J., as he then was, made on October 23, 2007, the appeals were quashed insofar as they related to assessments under the Employment Insurance Act and the Canada Pension Plan. On June 19, 2008, at the request of the appellant, McArthur J. ordered that the remaining appeals proceed pursuant to the general procedure.

[3] The appeals from the assessments under the Income Tax Act came on for hearing before me on December 9, 2009, and it quickly became apparent that the only issue that the appellant sought to pursue was not revealed by the Notice of Appeal. I granted leave to the appellant to file a Fresh As Amended Notice of Appeal, and that was done.

[4] By the amended pleading the appellant has limited the issue to the validity of the penalties assessed under subsection 227(9) of the Income Tax Act. Specifically, it is asserted that those penalties are subject to a defence of due diligence, and that the question of due diligence has been resolved in the appellant’s favour by a judgment of O’Connor, J of this Court. By that judgment O’Connor, J. allowed the appeals of Stella Pinnock and Stainton Pinnock from assessments made against them as the directors of 741290 Ontario Inc. under section 227.1 of the Income Tax Act in respect of amounts that should have been, but were not, remitted as withholdings from the wages paid by it to its employees.[4] The relevant part of paragraph 153(1)(a) and sections 227 and 227.1 are attached as Appendix “A”.

[5] Stella Pinnock and her husband, Stainton Pinnock, have been the directors of the appellant since its inception in 1987. From then until November 1998 the appellant operated Van Del Manor Nursing Home in Toronto under a license granted by the province of Ontario under the Nursing Homes Act. In November 1998 the Ontario Ministry of Health determined that the building could no longer be operated as a nursing home. After that Ms. Pinnock operated it as a retirement home for a brief period. Since September 1999, the premises have been leased to the City of Toronto, which operates it as a seniors’ home. The nursing home license was sold by the appellant’s bank.

[6] Mrs. Pinnock gave evidence for the appellant. From the outset the Pinnock’s had difficulty meeting their payroll. Mrs. Pinnock blamed this on a number of factors. The payroll was substantially higher than they had expected, based on the financial statements that they had seen prior to buying the business. The Ministry of Health required them to make substantial repairs, renovations and upgrades to the building, at considerable cost, in order to continue to use it as a nursing home. They also were required to increase the number of staff employed beyond the level that they had expected and that the income would support. The appellant was paid on a per patient basis by the Ministry of Health, and according to Ms. Pinnock’s evidence the payments were always made after the month end, when the money was required to pay current expenses. In short, the expenses of operating the business were higher than the Pinnock’s had foreseen, and there was an acute shortage of working capital from the outset.

[7] The appellant’s major income source was the monthly payments made to it by the Ontario Ministry of Health. These, Ms. Pinnock said, were amounts paid for specific purposes or activities such as patient care or nutrition, and they had to be applied to those purposes. The appellant’s employees were paid every second Thursday. For reasons that Ms. Pinnock attributed to delays by the Ministry of Health in making its payments, the appellant was frequently in the position of being unable to meet its gross payroll, which is to say the payroll including the statutory deductions that an employer is required to make for income tax, employment insurance premiums and Canada Pension Plan contributions. Frequently it did have sufficient funds, however, to meet the net payroll only, and on these occasions it did so by paying the employees their net pay for the period, but it did not remit the income tax and other deductions to the Receiver General within the time fixed by section 108 of the Income Tax Regulations[5] (the Regulations) for doing so.

[8] In January 2000, the Minister assessed Stainton Pinnock and Stella Pinnock pursuant to subsection 227.1(1) of the Act for the unremitted withholdings, interest and penalties. They appealed from those assessments to this Court, relying on the saving provision found in subsection 227.1(3), which reads:

227.1(3) A director is not liable for a failure under subsection 227.1(1) where the director exercised the degree of care, diligence and skill to prevent the failure that a reasonably prudent person would have exercised in comparable circumstances.

[9] Those appeals were heard by O’Connor J on September 29, 2004, and he gave judgment orally at the conclusion of the hearing allowing the appeals. His Reasons for Judgment are brief. He refers to the extent to which decisions made by the Ministry of Health affected the appellant’s profitability by imposing requirements to spend money on the maintenance of the building and by limiting the number of patients that could be accommodated, and to the financial problems caused by union demands. He found Mr. and Mrs. Pinnock to be credible witnesses, and to have attempted in good faith to resolve their financial difficulties by negotiating with the Revenue Agency officials, and by liquidating their personal savings to invest in the business.

[10] Schedule B to the Reply to the Notice of Appeal filed by the respondent lists some 93 assessments issued by the Minister between April 13, 1992 and July 14, 1999 in respect of withholdings either not remitted at all, or remitted late. By the time of the hearing the appellant no longer disputed the particulars of any of these assessments, either as to its failure to remit withholdings or as to the computation of the interest and penalties under the Act. It contested only the penalties for late remittance of the withholdings, on the basis that Stainton and Stella Pinnock were, at the material times, the alter ego of the appellant as they were the only directors, and so theirs were the controlling minds of the corporation. The appellant argues that if they, the only directors, exercised the degree of care, diligence and skill that a reasonably prudent person would, in comparable circumstances, have exercised to prevent the failure to remit on time, then it must follow that the corporation exercised sufficient diligence to be exculpated from the penal provisions of subsection 227(9). This submission, of course, necessarily depends upon the proposition that failure to remit the statutorily required withholdings is a strict liability offence rather than an absolute liability offence, and that the degree of diligence required of directors by subsection 227.1(3) is at least as great as that required to exculpate the company under subsection 227(9).

[11] The appellant argues that it would be incongruent and lacking in consistency for Parliament to have provided a defence of due diligence for directors from their potential vicarious liability under section 227.1 for the failure of a corporation to remit amounts withheld under section 153, and yet not provide a similar defence for the corporation from its potential liability to a penalty under subsection 227(9). The argument is that since the directors are the directing mind of the corporation the legislation must be presumed to require the same standard of conduct from the corporation itself as is required from the directors.

[12] In my view the matter is not so simple as that. The reasons of the majority of the Supreme Court of Canada in Toronto (City) v. C.U.P.E. Local 79[6] were written by Arbour J. At paragraph 23 she notes that there are three conditions that must be met for issue estoppel to apply:

(i) the issue to be decided must be the same as that which was decided in the prior case;

(ii) the earlier decision must have been a final one; and

(iii) the parties to both proceedings must be the same, or their privies.

While abuse of process by litigation is a more flexible doctrine than issue estoppel, it is clear from Arbour J.’s discussion of it at paragraphs 35 to 54 that the requirement of identity of issue in the two proceedings is as necessary to abuse of process as it is to issue estoppel.

[13] The rationale underlying both doctrines includes avoiding unnecessary expense to the parties to relitigate a matter that has already been decided, conserving judicial resources, avoiding the possibility of collateral attack on a prior judgment that would otherwise be final, and protecting the integrity of the judicial system from the harm to public confidence in it that would be occasioned by inconsistent judgments in respect of the identical issue. None of these concerns arise if the issues in the first and second proceedings are not identical.

[14] The appellant’s argument in this case assumes that if failure to remit amounts deducted is not an absolute offence, admitting of no defence whatsoever, then the degree of care that a corporation must show in order to establish a defence for purposes of the penalty imposed by subsection 227(9) of the Act must be identical to the degree of care that a director must show in order to avoid vicarious liability for the default of the corporation under subsection 227.1(3). I understand this proposition to be founded on the basis that subsection 227.1(3) uses the expression “due diligence” and that phrase has been used from time to time to describe the defence available to those charged with a strict liability offence.[7]

[15] I know of only one case in which the question whether the failure to remit as and when required is an absolute or a strict liability offence has arisen. That is Weisz, Rocchi & Scholes v The Queen, [8] a decision of Bowman, A.C.J., as he then was. His conclusion was that the offence of late remitting had not been established by the evidence, and so there was no need to decide whether, if it had been established, the appellant would have been entitled to avoid liability for the penalty by proof of due diligence. He did, however, add in obiter that although the question was one for another day, if he had been required to decide it he would have found that a due diligence defence was available.

[16] For purposes of this appeal, I am prepared to assume that a “due diligence” defence is available. Nevertheless, for the reasons that follow, I conclude that neither res judicata nor abuse of process by relitigation based on the judgment of O’Connor J. is available to the appellant, and that the defence of due diligence, assuming it is available at all, has not been established.

[17] Assuming that failure to remit as and when required is not an absolute but a strict liability offence, it nevertheless requires a greater degree of “due diligence” than does subsection 227.1(3). The words of that subsection are precisely the same as those found in paragraph 122(1)(b) of the Canada Business Corporations Act,[9] and were considered by the Supreme Court of Canada in Peoples Department Stores Inc. v. Wise.[10] That Court’s conclusion as to the standard of conduct that these words mandate is found in paragraph 67 of the unanimous judgment:

67 Directors and officers will not be held to be in breach of the duty of care under s. 122(1)(b) of the CBCA if they Act prudently and on a reasonably informed basis. The decisions they make must be reasonable business decisions in light of all the circumstances about which the directors or officers knew or ought to have known. In determining whether directors have acted in a manner that breached the duty of care, it is worth repeating that perfection is not demanded. Courts are ill-suited and should be reluctant to second-guess the application of business expertise to the considerations that are involved in corporate decision making, but they are capable, on the facts of any case, of determining whether an appropriate degree of prudence and diligence was brought to bear in reaching what is claimed to be a reasonable business decision at the time it was made. (emphasis added)

Can this be said to be the same standard that applies to the obligation of an employer to remit to the Receiver General the amounts that it has withheld from its employees’ earnings for their income tax liability as required under section 153? I think not.

[18] There is a marked contrast between the standard of conduct required by the “reasonable business decision” test under subsection 227.1(3) on the one hand and what is required by section 227 on the other. Subsection 227(4) creates a trust in favour of the Crown, whereby the employer holds the amounts deducted for income tax from payments of remuneration “… in trust for Her Majesty and for payment to Her Majesty in the manner and at the time provided under this Act.”

[19] It is certainly reasonable that an employer should not be penalized under subsection 227(9) where the failure to remit in time is caused by an event beyond the employer’s control, such as a failure of the post office to deliver a remittance mailed in time, or an error made by a bank clerk in transferring funds. However, subsection 227(4) does not permit the employer, in any circumstances, to make a business decision to use the funds for some purpose of its own, no matter how dire its financial plight may be or how brief the period for which it intends to use the funds. The funds belong to the employees, not to the employer. In my view, any failure to remit withholdings when they are due that results from a deliberate decision of the employer, whether that decision is made by a director or by an employee, would necessarily be culpable. Consequently, the issues that arise under subsection 227.1(3) and subsection 227(9) are different. Neither issue estoppel nor abuse of process by relitigation can apply in this case.

[20] Was the failure of the appellant to remit its withholdings as and when prescribed under the Act the result of an event beyond the control of the corporation, or did it result from a deliberate decision? Mrs. Pinnock certainly tried by her evidence to paint a picture of a corporation that was in default only because of unforeseeable problems caused by the actions of others. The expenses were greater than she and her husband had anticipated because they were not properly revealed to them before they purchased the business, and because the Department of Health made too many demands on them to spend money on upgrades and repairs. Labour costs were inflated by staffing requirements that were imposed on the appellant by the Department of Health, and by the demands of unionized workers. The payments from the Department of Health always came after the month end, when the money was required before that in order to meet the payroll and the accounts payable. Their attempts to raise additional capital were thwarted by the banks that would not extend additional credit to the appellant after its line of credit was exhausted, and by the refusal of the Department of Health to approve a prospective investor.

[21] It is clear from the evidence of both Mrs. Pinnock and Ms. Ebanks, a CRA Collections Officer, as well as from the Amended Notice of Appeal, that the appellant habitually failed to remit the payroll withholdings as and when required under the Act, and that its failure to do so was caused entirely by the fact that it did not have the necessary funds to meet the gross payroll, and so elected to pay the net payroll to the employees and not pay the withholdings. This practice was the subject of adverse comment by the Supreme Court of Canada in Royal Bank of Canada v. Sparrow Electric Corp.:[11]

(B) The Nature of Section 227(4) and (5) Statutory Trusts

25 Section 153(1)(a) ITA places an affirmative duty upon employers to deduct and withhold amounts from their employees’ pay cheques, and remit those withholdings to the Receiver General on account of the employees’ tax payable. By virtue of s. 153(3) ITA, these withholdings are deemed to become the property of the employee:

153 …

(3) When an amount has been deducted or withheld under subsection (1), it shall, for all the purposes of this Act, be deemed to have been received at that time by the person to whom the remuneration, benefit, payment, fees, commissions or other amounts were paid.

In a perfect world, these deductions would be made, a cash fund would be set aside by the employer, and the withheld amounts would be promptly remitted to the Receiver General when due. The deducted amounts, lawfully the property of the employee, would in this way be transferred to Her Majesty to be set against his overall tax payable.

26 As a practical reality, however, these deductions are often not remitted as required under the ITA. Instead, the withholdings are commonly made solely as a book entry, and therefore the deduction of taxes from wages becomes merely a notional transaction; no cash is actually set aside for remittance and, often, the deductions are not transferred to the Receiver General: see, e.g., Re Deslauriers Construction Products Ltd., [1970] 3 O.R. 599 (C.A.), at p. 601. It is at this point which a business becomes indebted to Her Majesty for the amount of moneys only fictionally deducted. I hasten to add, however, that while it can be said Her Majesty at this point becomes de facto, if not de jure, a creditor of the non-remitting employer, the arrangement is dissimilar to an ordinary debtor-creditor situation in two fundamental respects. First, in contrast to usual negotiated credit arrangements, this transaction is of manifestly a non-consensual nature. Second, by virtue of s. 153(3), the debtor can in law be considered to be utilizing an asset which is the property of its employees. In this sense, it is not inaccurate to characterize the non-remittance of payroll deductions as a “misappropriation” of the property of another. Indeed, the authorities, correctly in my view, commonly refer to the conduct of the tax debtor in this manner: Roynat, supra, at p. 646, per Twaddle J.A.; and Pembina on the Red Development Corp. Ltd. v. Triman Industries Ltd. (1991), 85 D.L.R. (4th) 29 (Man. C.A.), at p. 48, per Lyon J.A. dissenting.

27 The economic reality of this sort of misappropriation of statutory deductions is artificially to increase the working capital of the tax debtor. By foregoing a cash payment to Her Majesty in the amount of the payroll deductions, the tax debtor is able to utilize the freed resources elsewhere in its business. The effect of non-remittance was summarized by Lyon J.A. in his dissenting reasons in Pembina on the Red Development, supra, at p. 48:

… either the tax debtor used the misappropriated deductions for its own purposes or the pool of moneys available for distribution to the tax debtor’s creditors … has been increased by the amount which the tax debtor failed to remit to the Receiver-General.

28 It is against the backdrop of this unfortunate factual scenario that the provisions of s. 227(4) and (5) can be seen to have been enacted. While it can be said that at the point of withholding the employer becomes the trustee of a fund which is in law the property of its employee, s. 227(4) has the effect of making Her Majesty the beneficiary under that trust. I agree with the observation of the mechanics of s. 227(4) made by Twaddle J.A. in Roynat, supra, at p. 646, where he states:

Although [s. 227(4)] calls the trust created by it a deemed one, the trust is in truth a real one. The employer is required to deduct from his employees’ wages the amounts due by the employees under the statute. This money does not belong to the employer anymore. It belongs to the employees. The employer holds it in a statutory trust to satisfy their obligations.

The conceptual difficulty arises, of course, when the tax debtor fails to set aside moneys which are to be remitted. At this point, the subject of Her Majesty’s beneficial interest becomes intermingled with the general assets of the tax debtor. As Twaddle J.A. rightly observed in Roynat, supra, at p. 646, “Her Majesty’s claim … then be[comes] that of a beneficiary under a non-existent trust”. In short, the misappropriation of statutory deductions conceptually problematizes the legal vehicle — the concept of the trust — which Parliament has invoked in order to regain the moneys lawfully owed to Her Majesty.

[22] Faced with a chronic insufficiency of working capital, and unable to meet its gross payroll in full from time to time, the appellant chose to solve the problem by appropriating the withholdings rather than by resorting to the mechanisms available under the statutes designed to deal with the problems of insolvent corporations. This misappropriation is surely conduct beyond the threshold of culpability under subsection 227(9) of the Act, no matter whether the offence be considered “strict liability” or something else. For this reason, like Bowman C.J., I need not decide whether the offence is one of absolute liability or not. Certainly, the appellant in this case has no basis on which to claim that it used all reasonable means, or even its best efforts, to avoid the failure to remit on time.

[23] The appeals are dismissed, with costs to the respondent.

Signed at Ottawa, Canada, this 3rd day of March, 2011.

“E.A. Bowie”

Bowie J.
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What You Need to Do Now to Fix Your Tax Problems Rather than Going to Court

If you sense that you will run into troubles with the tax man or you have been alerted by the tax man, then you cannot afford to wait any longer! Do something to resolve your tax problems.

It makes far more sense, and will be less costly in the long run, to resolve your tax problem with the tax man right away, rather than dealing with the financial burden of going to court.

The first step is to stop procrastinating and running. Take action today!

Hire someone who is qualified and has the experience to help you solve tax problems. Many people try to handle their tax problems themselves, resulting in frustration and negative results because they do not understand the complicated tax system well.

Our initial consultation is FREE and CONFIDENTIAL. You will get comprehensive analysis of your tax problems and recommended solutions in the first meeting. Then you can decide what to do from there. There is no obligation required.

CRA Tax Penalites

 

Filing taxes late: There’s a high cost


Thousands of Canadians file their taxes late. Be prepared to pay hefty penalties and to lose some government benefits if you do.

Millions of Canadians filed their tax returns before the April 30th deadline, but there are thousands that end up filing late, or not filing at all.

If you do not owe money, there is no late filing penalty. You will still be able to file later and still receive your tax refund. However, if you owe money and file late for whatever reason, you will end up triggering penalty fees, face interest payments and become ineligible for certain government benefits.

Here are few things to know if you’ve filed your taxes late:

Interest and penalties
There are two different kinds of penalties levied by the the Canada Revenue Agency (CRA).

There are late filing penalties when you owe taxes and don’t file your return on time. The penalty is 5 per cent of the amount owed, plus an additional 1 per cent of the balance owing for each month that your return is late – to a maximum of 12 months.

For example, if you owe $2,500 and file six months late, you will be charged 11 per cent – or $275.
On top of the late filing penalty, you will also be charged interest on any amount owed. Interest is compounded daily, and interest rates can change every 3 months.

If you filed a late return this year, and you were also charged a late-filing penalty in one of the previous three years, your late-filing penalties will double. The CRA will charge a penalty of 10 per cent of the taxes you owe, plus an additional two per cent for each full month that your return is late, up to a maximum of 20 months.

News Source: theStar.com

CRA’s Hefty Late Filing Penalties

First time late filing penalty: if you owe tax and do not file your return on time, CRA will charge you a late-filing penalty. The penalty is 5% of your tax balance owing, plus 1% of your balance owing for each full month that your return is late, to a maximum of 12 months. In another word, if you have late tax unfiled, for the very first year, you will have 17% of tax owing for the penalties alone.

Repeating late filing penalty: if the late filing is a re-occurring event within three years, then the penalties become nearly tripled. The late-filing penalty becomes 10% of your tax balance owing, plus 2% of your tax balance owing for each full month that your return is late, to a maximum of 20 months. That is a late filing penalty of 50% of your tax owing.

The Compounded Daily Interests

In addition to the late filing penalties, CRA charges much higher interest than banks on your tax balance and penalties. The interest is compounded DAILY. Use rule of thumb, if assumed interest is 7%, which is not abnormal for CRA for many years, then tax owing doubles in about ten years. When the interest is compounded daily, the interest keeps running when you sleep.

What You Need to Do Now is to stop procrasnating, start taking actions. You can not afford to wait any longer!

What We Can Do to Help You

To control your damage right away, we will do a quick, sometimes, on the spot assessment, if you have unfiled taxes for years and you do not owe taxes. Then we will quickly help you to reconstruct all the financial information and locate all your missing pieces of tax information to report your tax returns properly.

If we determine that you have unfiled back taxes and large tax debts owing for many years and thus the interests and late filing penalties are alarmingly high. Then we may need to help you to file under the Voluntary Disclosure Program or Tax Amnesty immediately to avoid the risk of being caught by CRA and thus lose the opportunity to file under the protective Voluntary Disclosure Program to reduce the severe damage. The penalties alone may force you into bankruptcy.

Why You Should Work with Tax 911 Now

Unlike these accountants or the tax filers with seasonal appearance in the malls, we can not only fix your back tax problem, we can also help you to negotiate with CRA for the matters before and after the filing.

Before the filing, we can help you to file Tax Amnesty program to completely remove your penalties and/or some of the interests.

After the tax filing, if CRA challenge you or audit you, we have the expertise to represent you and fight for you on the returns;

If the tax bill is too high, then we can negotiate a tax relief for you to reduce the tax penalties and interest, or we can help you to negotiate an affordable payment plan so no legal collection actions will be taken against you by CRA.

We are different because we can provide much more comprehensive services to protect you in many aspects and all stages of your tax dealing with CRA.

Our Unlimited Free Consultation & Service Guarantee

To begin with, we offer RISK FREE no obligation initial consultation just to help you to understand the depth and complexity of your tax problems. We will also provide you the recommended steps to take to fix your tax problems. Then it is completely up to you to decide what to do from there.

If you do decide to engage us to fix your tax problems, we will provide price match guarantee within the entire tax negotiation industry.

Professional Canadian TAX Accountants

Are you facing any of the following tax issues?

  • Issues on back taxes, late taxes, unfilled taxes?
  • Personal, self-employed business, Corporate and business tax issues?
  • Unreported Income, under-reported income?
  • Issue with tax audit (Income tax, GST/HST, PST, payroll, WSIB)?
  • International tax issues?
  • Overwhelmingly large tax bill?
  • Income garnishment, tax lien?

That is our specialty as Canadian Tax Accountants!

When you have complicated Canadian tax matters, there are very few Canadian tax accountants and lawyers who can handle the task. Most of them, due to the complexity of the issues, will stay clear from this filed. However, solving complicated tax problems is all we do!

Tax 911 Now has experienced Canadian Tax Accountants who practice exclusively on special tax field providing tax services to tax clients who have urgent or complicated tax issues such as those we listed above.

To better help clients, we provide full services so that clients can solve their complicated tax problems under one roof. We can prepare your bookkeeping in house; we can prepare your tax returns in house, be it personal, be it self-employed business, be it corporation, be it payroll, we represent you to deal with the taxman, we negotiate tax settlement, etc. as experienced Canadian Tax Accountants, we do it all.

Our satisfied clients are pleased as we provided them with exceedingly high quality of tax services on tough tax problems. Those clients would not even dream of dealing with a complex tax matter without our professional Canadian tax accountants’ help.

Do you have “Impossible”? “Unsolvable” tax problems? Tax 911Now’s team of tax experts and tax accountants will help.

We are excited about the challenge of trying to solve “impossible” or “unsolvable” Canadian tax problems.

If you have a complicated Canadian tax issue, you do not want to wait for long time to get some help as most of those tax problems are serious and urgent in nature – you probably want to fix it as soon as possible by effective tax accountants!

We strive to provide fast resolution to your tax problems! For example, in most cases, if we get a client with tough tax issue, we will start to take action immediately in the first appointment. It is a rewarding experience for us to see that clients walking in appearing stressed and walk out with sign of big relief!

Tax 911 Now’s Tax Service Range

Our Tax services include Tax Help, CRA Tax Help, Help with tax problems, CRA Tax Relief,  Tax Relief ASAP, CRA Problem Resolution, Tax Resolution Services, Tax Negotiator, Voluntary Disclosure Program, VDP, Tax Amnesty, Tax Repair, Tax Expert, Tax Issues, Tax Advisor, Tax Help by Licensed Tax Professional, Efile, Efiler, Tax Attorney, Accountant Help, Sales Tax Help, CRA Audit Help, Tax Audit, Tax Problem, Tax Lien, CRA Help, Back taxes, Unfiled tax returns, Past Due Returns, Emergency Tax Help, Tax Return Preparation, Payroll Tax Problem, Tax Levy Release, Wage levy Relief, Wage garnishment release, CRA Problem Solver, CRA Tax Settlement Negotiation.

What You Need to Do Immediately to Fix Your Tax Problems?

If you feel you will be caught by CRA pretty soon or you have received letters or calls or personal visit from the tax man, then you cannot afford to wait any longer! Do something to resolve your tax problems.

The first step is to stop procrastinating and running. Take action today!

Hire seasoned tax accountants who are qualified and have the experiences to help you solve tax problems. Many people try to handle their tax problems themselves and failed terribly.

Get Tax help TODAY by calling Tax 911 Now team at 877-918-2991 or go to Contact page.

Our Free No Obligation Consultation & Rate Guarantee

To begin with, we offer first time RISK FREE unlimited time consultation just to help you to understand the depth and complexity of your tax problems. We will also provide you the recommended steps to take to fix your tax problems. It is no obligation and thus it is completely up to you to decide what to do from there.

If you do decide to engage us to fix your tax problems, we provide price match guarantee within the entire tax negotiation industry.

 

Tax Payer Relief by CRA’s Taxpayer Relief Program

CRA has been training all their agents, such as auditors or collection agents, to use the buzz word “Tax payer relief” when communicating with tax payers as if that is an easy and simple request to make to get a big reduction of the tax debts

The matter of the fact is that every tax payer wants to have their tax debts reduced. To not open a gate of flood, CRA’s criteria for tax payer relief are quite strict to say the least.

CRA normally grants tax payer relief from penalties and interest due to extraordinary circumstances, actions of the CRA and inability to pay or financial hardship. Penalties and interest may be waived or cancelled in whole or in part where there are circumstances that are beyond the taxpayer’s control.

The following are typical examples of situations that may merit for tax payer relief:

Natural or man-made disasters such as, floods, fires, hurricanes, civil disturbances, Serious illness or accidents,  Serious mental or emotional distress, such as a death in the immediate family.

Mistakes of CRA: you can apply under taxpayer relief if actions of the CRA caused the penalties and interest including:

–  Processing delays within a reasonable time whereby the taxpayer was not informed of the amount owing;

–  Errors in materials by CRA which led to a mistake.

–  Incorrect information provided to the taxpayer in writing;

–  Errors in processing,

–  Delays in resolving an objection or an appeal.

Tax payer relief provision enables the taxpayer to settle their account with possible financial relief. The result of successful taxpayer relief includes:

– Waive or cancel penalties and interest,

– Extend the filing-due date for making certain elections or grant permission to amend or revoke certain elections.

– Authorize a refund to an individual even though an income tax return is filed outside the normal filing period;

– Authorize a reassessment or re-determination for an individual beyond the three-year normal reassessment period to allow a refund or a reduction in an amount payable.

You have 10 years from the end of the calendar year in which the tax year or fiscal period at issue ended to make a request to the CRA for tax payer relief.

We have gained special knowledge that CRA does not share with public about tax payer relief approving factors that we have achieved great success over. Just see yourself what the satisfied client say about their tax payer relief results in their testimonials. You can be the next.

You many think that you are not qualified, if you do not ask, you lose 100%. By asking the help from experienced professionals, you chance of getting tax payer relief is much increased.

What You Need to Do Now to Get Tax Payer Relief

Hire someone who is qualified and has the experience to help you to get your tax reduced. Many people try to handle the tax payer relief themselves, resulting in frustrating results because they do not understand the how tax payer relief system work. Keep in mind the tax payer relief is more than just a simple request. You need strong support from various aspects.

Why Choose Tax 911 Now Team for Tax Payer Relief

We have helped clients in reducing their tax debts by filing tax payer relief and negotiated excellent settlement for them. See what happy clients say about our Tax payer relief service in the testimonial.

Tax 911 Now tax payer relief services are offered across Canada in:

  • Toronto
  • Markham
  • Vancouver
  • Calgary

Our initial consultation is FREE and CONFIDENTIAL. You will get comprehensive analysis of your tax situation and recommended solutions in the first meeting. Then you can decide what to do from there.

How To Stop and Release an Income Garnishment

Canada Revenue Agency (CRA) may collect the unpaid assessed amounts by way of garnishment. This method may be used to obtain the tax owing by tax payers for the amounts owing to CRA.

Garnishment is usually served on a third party such as a company, financial institution or individual who the CRA believes is liable to make a payment to a tax payer.

The following factors may be considered by CRA prior to commencing garnishment action:

(a) whether an amount is in dispute under the objection or appeal process;

(b) the negative impact of the requirement upon the registrant’s operations;

(c) whether undue hardship will be created for the registrant; and

(d) the payment terms associated with the requirement, where appropriate.

If you owe back taxes to CRA, CRA can garnishee your wage without a court order.

If you are being threatened with a income garnishment by CRA, you need to act immediately. Waiting longer will make your situation worse.

If without any professional help, you may have only one of the three ways to stop an income garnishment:

First, you can contact CRA and attempt to make a deal with them so they will stop the garnishment;  CRA will not make a deal with you until you have complied with the Income Tax Act filing requirement. In addition, CRA requires you to make the payment in full including the interests and penalties if applicable to remove the garnishment.

Second, you can file a consumer proposal, which immediately stops the garnishment for a short period.  CRA will make a decision on the proposal. In general it is difficult to get CRA to accept the proposal.

Finally, you could file bankruptcy in Ontario which also stops the wage garnishment. Bankruptcy is usually the last resort because it can destroy your financial credibility you built up over the years.

Under Tax Professionals’ help, you can have many more options that control the damage to your life so that you can again lead a normal life.

We are effective tax negotiators who remove income garnishment for you fast! We can remove income garnishment in days as mentioned in clients’ testimonials.

What You Need to Do Immediately to Fix Your Income Garnishment Problem?

If you feel you will be garnished by CRA pretty soon or you have received letters or calls threatening with a garnishment, then you cannot afford to wait any longer! Do something to resolve your tax problems.

It makes far more sense to address the threat right way, rather than dealing with the financial burden of wage garnishment, bank levy when you need the money most.

The first step is to stop procrastinating and running. Take action today!

Hire someone who is qualified and has the experience to help you solve tax problems. Many people try to negotiate their tax problems themselves, resulting in worsened results.

Stop the garnishment TODAY by calling Tax 911 team at 877-918-2991 or go to Contact page.

How Do You Choose Your Tax Service Providers?

The most important factors to choose your tax service provider are: a. the service provider is competent and experienced. b. the service provider genuinely cares about helping you; c. the costs are reasonable.

Having been dealing with tax agencies of all levels in all the years, Tax 911 Now’s team of professionals has helped many clients with tax problems like you to get tax settlement that are satisfactory to the clients who in turn shared their positive experiences and appreciation in their testimonials.

Be able to take care and help others and get appreciated in return makes us feel proud of what we do. Putting clients’ best interests before anything else is the core belief for Tax 911 Now.

Our Free No Obligation Consultation & Price Guarantee

To help you to move forward with your problem, we offer RISK FREE initial consultation just to help you to understand the depth and complexity of your tax problems. We will also provide you the recommended steps to take to fix your tax problems. It is no obligation and thus it is completely up to you to decide what to do from there.

If you do decide to engage us to fix your tax problems, we provide price guarantee within the entire tax negotiation industry.

Tax Representation Canada

When do you need a tax representative?

When a taxpayer has a complicated tax situation that needs extra attention, we always recommend that Professional Tax Representation be used. 

Representation is also useful if a taxpayer does not have the time or desire to speak to the CRA on their own.

Why use a tax representative?

Professional Tax Representation is a very powerful tool you can use to “even the odds” when you need help with the CRA. 

As you may have experienced, CRA agents can be very intimidating, when they are making demands on you, the taxpayer. They tend to be less forceful and more reasonable when they must address themselves to a Professional Representative, such as an Attorney or Accountant.

A good tax professional will know the in’s and out’s of the CRA complex system. They will know all of the right questions to ask you and how to properly present your case to the CRA so that you get the results that you deserve.

At Tax 911 Now, we are experienced tax professionals.

If you have a large or overdue tax bill or need help dealing with the collection branch of the CRA, Tax 911 can offer the best tax help available. Helping taxpayers arrange settlements with the CRA is our specialty.

You, as a taxpayer, probably do not know all the rules and formulas that are applicable to your situation. The CRA Agent does, but usually only reveals the portion they want you to know, not the portion that would be helpful to you. The agent’s job, after all, is to collect money from you, not be your friend! Even a friendly CRA agent is still a CRA COLLECTION AGENT, not a friend.

You need an experienced tax representative on your side. 
At Tax 911, our professionals deal with the CRA every day, and can present your case to the CRA in its own terms, with full knowledge of all the rules and regulations.

We offer our services all across Canada and in the following cities:

  • Toronto
  • Markham
  • Vancouver
  • Calgary

If you need tax help please call one of our tax professionals at: 1-877-918-2991.

Voluntary Disclosure Program (VDP)

As the Canada Revenue Agency (CRA) moves forward to aggressively address non-compliance on unreported income or unfiled taxes, it becomes more important that you need to be aware of the Voluntary Disclosures Programs (VDP)

In cases of gross negligence, the Income Tax Act allows the CRA to assess a penalty of up to 50% of the unpaid tax or the improperly claimed benefit. In addition, the court may, on summary conviction, fine them 50% to 200% of the tax evaded, and sentence them to a jail term.

You need to quickly come to us before CRA initiates any action against you.  As soon as CRA initiates the contact, then it is too late. It could be one letter in the mail, one phone call, one personal visit, etc.

Voluntary Disclosure Program (VDP) Can Be The Perfect Solution

It could be just ONE day late, you lose everything and more! What You Need to Do Now to Fix Your Tax Problems Rather than Getting Your Life Ruined? – Voluntary Disclosure Program (VDP)

If you have unreported income, under-reported income, years of late filing with tax owing, then you cannot afford to wait any longer! Do something to resolve your tax problems TODAY!

Hire someone who is qualified and has the experience to help you solve tax problems. Many people try to handle their tax problems themselves, resulting in negative results because they do not understand the complex Voluntary Disclosure well. Keep in mind the Voluntary Disclosure Program (VDP) is more than just a simple form.

We have helped clients in reducing their tax damage by filing voluntary disclosure program (VDP) and negotiated excellent settlement for them. See what happy clients say about our Voluntary Disclosure service in the testimonial.

Do you need VDP services in other parts of Canada? Here is where our services are offered:

  • Toronto
  • Markham
  • Vancouver
  • Calgary

Our initial consultation is FREE and CONFIDENTIAL. You will get comprehensive analysis of your tax problems and recommended solutions in the first meeting. Then you can decide what to do from there.

Unfiled Tax Returns to CRA

There are more and more people experiencing problems of unfiled tax returns. It is understandable that there are many priorities in people’s lives and thus sometimes it is becoming increasingly difficult for taxpayers to catch up with their tax filing obligations.

The CRA, however, views your situation differently, not in sympathy perspective as CRA is, by its nature, a tax revenue agency and thus CRA views your Unfiled Tax Returns to CRA to be not in compliance with income tax act and thus this behavior merits some financial or legal punishment.

To be in compliance, you must have all your Unfiled Tax Returns filed. This means you won’t get any relief from CRA collection actions such as income garnishment or bank levy, until you complete and file all tax returns. So the sooner you file all your back taxes, the sooner the CRA will be willing to negotiate with you.

File Your Past Tax Returns

It is very important to understand that filing your tax return each year will save you out of CRA trouble. If you have unfiled tax returns for few years, it is to your best interests to file them as soon as possible.

Knowingly not filing your tax return is illegal. However, CRA understands that people make mistakes and thus they give you a limited time window to file over due tax returns to correct the wrong.

CRA Notifies Your Unfiled Tax Returns

The CRA may send you a demand to file for the current year tax unfiled; CRA may also wait for few years and then send you the demand to file letter. You need to keep in mind that CRA will eventually find you and if they do, you will have to face the late filing tax penalties and accumulated interests starting from the date when the tax is due.

Consequences of Not Filing Past-Due Returns

If you do not cooperate with CRA and ignore the demand to file notice, CRA may just take some harsh legal action against you, such as lock up your bank, garnish your income, bank levy, etc.

When a Mistake Becomes a Crime

With the advance of the technology, CRA has enhanced its database to identify people who have unfiled tax return problems for years. If you have unfiled returns, you are automatically on the list of most wanted people for tax collection. If you can act before CRA gets to you, you have a better chance of resolving your tax problems without going thorough the pain of legal action and embarrassment.

The CRA has a wide range of punishment available that they can impose on persons who don’t file returns. Intentionally not filing, or filing a false return, is a crime. It is critical to take action to resolve your unfiled return problems before a simple mistake becomes a crime.

Most Common Excuse for Unfiled Tax Returns – I Can’t Afford to Pay the Tax Owing

Many people do not file the tax for their personal reasons, such as divorce, sickness, etc. Unfortunately, affordability is not a sound one. The reason is simple. The longer you wait to file, the more you will end up paying. It is like spinning in a vicious cycle.

Dealing with over due tax returns immediately is important if not critical. Wait for too long, then it becomes a much serious matter that cause legal actions. If you file tax and can not afford to pay, there are many options available to you such as negotiate a payment plan or tax relief. So stop making excuses, take action to clear up your back taxes.

It is important that you try to promptly deal with filing past-due tax returns. The stress you have can be removed if you just get professional help. We specialize in such tax problem solutions. We are here to help you when you need the most.

CRA’s Hefty Late Filing Penalties

First time late filing penalty: if you owe tax and do not file your return on time, CRA will charge you a late-filing penalty. The penalty is 5% of your tax balance owing, plus 1% of your balance owing for each full month that your return is late, to a maximum of 12 months. In another word, if you have late tax unfiled, for the very first year, you will have 17% of tax owing for the penalties alone.

Repeating late filing penalty: if the late filing is a re-occurring event within three years, then the penalties become nearly tripled. The late-filing penalty becomes 10% of your tax balance owing, plus 2% of your tax balance owing for each full month that your return is late, to a maximum of 20 months. That is a late filing penalty of 50% of your tax owing.


The Compounded Daily Interests

In addition to the late filing penalties, CRA charges much higher interest than banks on your tax balance and penalties. The interest is compounded DAILY. Use rule of thumb, if assumed interest is 7%, which is not abnormal for CRA for many years, then tax owing doubles in about ten years. When the interest is compounded daily, the interest keeps running when you sleep.

What You Need to Do Now is to stop procrasnating, start taking actions. You can not afford to wait any longer!

What We Can Do to Help You

To control your damage right away, we will do a quick, sometimes, on the spot assessment, if you have unfiled tax returns for years and you do not owe taxes. Then we will quickly help you to reconstruct all the financial information and locate all your missing pieces of tax information to report your tax returns properly.

If we determine that you have unfiled tax returns and large tax debts owing for many years and thus the interests and late filing penalties are alarmingly high. Then we may need to help you to file under the Voluntary Disclosure Program or Tax Amnesty immediately to avoid the risk of being caught by CRA and thus lose the opportunity to file under the protective Voluntary Disclosure Program to reduce the severe damage. The penalties alone may force you into bankruptcy.

Why You Should Work with Tax 911 Now

Unlike these accountants or the tax filers with seasonal appearance in the malls, we can not only fix your unfiled tax return problem, we can also help you to negotiate with CRA for the matters before and after the filing.

Before the filing, we can help you to file Tax Amnesty program to completely remove your penalties and/or some of the interests.

After the tax filing, if CRA challenge you or audit you, we have the expertise to represent you and fight for you on the returns;

If the tax bill is too high, then we can negotiate a tax relief for you to reduce the tax penalties and interest, or we can help you to negotiate an affordable payment plan so no legal collection actions will be taken against you by CRA.

We are different because we can provide much more comprehensive services to protect you in many aspects and all stages of your tax dealing with CRA.

Our Unlimited Free Consultation & Service Guarantee

To begin with, we offer RISK FREE no obligation initial consultation just to help you to understand the depth and complexity of your tax problems. We will also provide you the recommended steps to take to fix your tax problems. Then it is completely up to you to decide what to do from there.

If you do decide to engage us to fix your tax problems, we will provide price match guarantee within the entire tax negotiation industry.