FAQ - Filing Tax Returns for Previous Years
Filing tax returns is an essential part of managing your finances and fulfilling your obligations as a Canadian taxpayer. However, life can get busy, and sometimes we miss the deadline for filing our returns. If you're in this situation, you might have questions about how to handle tax returns for previous years. This FAQ aims to provide clear answers to some of the most common questions about filing past tax returns with the Canada Revenue Agency (CRA).
Can I Submit Tax Returns for Previous Years in Canada?
Yes, you can submit tax returns for previous years in Canada. The CRA allows taxpayers to file returns for past years, even if they missed the original deadline. It is essential to file these returns as soon as possible to avoid potential penalties and interest on any taxes owed.
How Far Back Can You electronically file Tax Returns in Canada?
If you are using do-it-yourself software to NETFILE your previous years returns, you can electronically file up to 7 previous years (including the current tax year).
If you are working with an accountant who will file your previous years tax returns for you, they will use EFILE-certified software to file up to 7 previous years (including the current tax year) on your behalf.
What Is the Oldest Tax Return I Can File?
According to the CRA, you may file up to 10 years of prior years tax returns. That said, any return older than the last 7 years (including the current tax year) will need to be completed manually and submitted as a paper tax return (i.e. you will need to use the CRA’s tax package and mail the completed paper return to them). The CRA may also request additional information to process these older returns.
Is There a Penalty for Filing Taxes Late If You Owe Nothing in Canada?
If you owe no taxes or are entitled to a refund, the CRA does not charge a late-filing penalty. However, it is still beneficial to file your return to ensure you receive any refunds or benefits you may be eligible for, such as the Canada Child Benefit or GST/HST credit.
Did you know?
Blackspark offers a no-obligation, free call with one of our licensed CPAs - they’ll advise you on your personal taxes and provide an upfront price to prepare your tax return.
What Should I Do If I Find Errors in My Previous Tax Returns?
If you discover an error in a previously filed tax return, you can request an adjustment using the CRA’s T1 Adjustment Request form. You can also make corrections online using the CRA's My Account service. It is crucial to correct any mistakes promptly to avoid potential issues with your tax filings.
How Long Should I Keep My Tax Records?
The CRA recommends keeping your tax records for at least six years from the end of the tax year to which they relate. This includes all documents that support your income and deductions, such as receipts, T4 slips, and expense records. These records are essential if the CRA requests information to support your tax return.
Can I Get a Refund for Previous Years?
Yes, if you are entitled to a refund for a previous year, you can still receive it by filing your return. The CRA will process your return and issue any refunds owed to you. However, it is important to note that there is a deadline to request a refund for overpaid taxes, which is generally ten years from the end of the tax year in question.
What Happens If I Don't File My Taxes at All?
Failing to file your taxes can lead to significant penalties and interest on any amounts owed. The CRA can also take legal action to collect outstanding taxes. Additionally, not filing your taxes can result in missed benefits and credits. It is always best to file your returns, even if they are late, to avoid these consequences.
Conclusion
Filing tax returns for previous years might seem daunting, but it is a manageable process with the right information. The CRA provides various resources to help taxpayers catch up on their filings and correct any mistakes. By addressing past tax returns promptly, you can avoid penalties, receive any refunds owed, and ensure you are up to date with your tax obligations. If you have any specific questions or concerns, it is advisable to consult a tax professional or contact the CRA directly for guidance.
This blog post is intended to provide general information only and should not be construed as tax advice or opinions. Always consult a qualified accountant before making any decisions regarding your tax situation.
