Bob Gauvreau explains why missing tax deadlines costs businesses more than the tax itself. Failure-to-file penalties are steeper than interest on unpaid taxes. File on time even if you can't pay, and hire a bookkeeper to keep deadlines straight.
Ignoring tax deadlines is one of the worst strategies that you could possibly apply in your business. I see it all the time. Businesses come in and work with us and they've been missing their sales tax filing, they missed their payroll liabilities filing, they missed their corporate or personal tax filing. All this does is it incurs penalties related to those filings, and they can be quite substantial, including failure to file penalties or misrepresentation. Using could be looking at getting yourself in a lot of trouble. Instead, even if you can't afford to pay the tax liability that's owing, we want to make sure that everything gets filed on time. We may owe interest related to not being able to pay that debt at the current time, but at least we're not incurring penalties for failure to file or missing any of those deadlines. Those penalties can end up being way more expensive than than any professional fees that you would incur to get it done on time. In fact, the proactive way to do this is to get a bookkeeper and an accounting firm in place to make sure all of your filings are done regularly on time. Give you the transparency over what's going on in your business, and you'll avoid all those interest and penalties associated with those filings and your business will be in a much better position. Plus, you're supported by the professionals that are in the bookkeeping and accounting team.
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