Canadians Delay Filing Taxes for Fear of Debt

Article content

More Canadians have been putting off filing taxes because they fear they will owe money this year, according to a new survey from H&R Block Canada.

According to the April 22-24 survey of 1,506 Canadians, 23 per cent have to file their taxes just under a week before the April 30 deadline. While 71 percent of those who have not yet filed plan to do so before the end of the month, a quarter expect to miss the deadline and the remaining four percent do not plan to file at all.

Article content

“The Canada Revenue Agency reports that around 10 per cent of Canadians miss filing their taxes each year, but we are seeing an increase in late tax returns this year and many are expecting to miss the tax filing deadline altogether,” Yannick Lemay, a tax expert at H&R Block Canada said in a news release.

Nine percent of those planning to file said they’re putting it off because they’re worried they’ll owe money, but 63 percent said they just haven’t gotten around to it yet.

“We know that for some people, the fear of owing money is a significant factor, even though the vast majority of people who have applied so far have received a refund,” Lemay said.

Of those who will miss the deadline, 22 percent said they simply haven’t made it a priority yet, while three percent are worried they will owe money.

For those who don’t plan to file their taxes, the driving factors are equal parts not being a priority and worries about owing money.

“Our message to all Canadians is to file your taxes before the April 30 deadline,” Lemay said. “Avoiding a tax return is never the answer, as late-filing penalties and fees could leave you owing more money – and you may be pleasantly surprised by the tax credits and benefits you’re entitled to.”

Article content

In fact, only 18 percent of respondents said they feel like they truly understand the tax credits and benefits they may be eligible for. As a result, many Canadians could be pleasantly surprised to receive a refund or year-round benefits that offset the amount they owe in taxes.

According to a separate survey by the Canadian Imperial Bank of Commerce, many people are relying on expected tax returns to combat the rising cost of living this year. The main ways they plan to use their refund include saving, paying off debt, and spending on essentials. Only 12 percent intend to invest their tax returns.

Filing your taxes late could also incur costs for Canadians. Those who filed one of their last three tax returns late and received demand letters from the Canada Revenue Agency could face higher penalties for filing their debts late, the H&R Block report says.

Those who owe money but do not have the means to pay it have options available, such as negotiating a payment plan or paying in installments that work for them and the CRA, the report said.

Share this article on your social network