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Late Corporate Tax Filing? Here’s What You Need to Know!

10 Mar 2025 · 2 min

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1:58

Bob Gauvreau explains deadlines, penalties, and audit risk when corporate tax returns are filed late. Key points: balance owing must be paid within 90 days of the corporate year end (example: March 31 → payment due June 30); the corporate tax return must be filed within 180 days (six months) of year end (example: March 31 → filing due September 30). If the balance is paid within 90 days and nothing is owing at filing, there is no late-filing penalty. If a balance remains owing at the filing deadline, the late-filing penalty is 5% initially plus 1% per month thereafter. Filing late also raises the agency risk profile and increases the chance of an audit. Practical mitigation: keep bookkeeping current and work with professionals.

Questions this video answers

Within 90 days of the corporate year end (example: March 31 year end → pay by June 30).

Within 180 days (six months) of the corporate year end (example: March 31 year end → file by September 30).

Initial 5% of the balance owing plus 1% for each additional month late.

If the balance owing was paid within the 90-day payment window and nothing is owing at the filing deadline, there is no late-filing penalty.

Chapters

So a great question that we get asked often is what happens if we file our corporate taxes late? So the first part is, let's talk about the deadlines. So any balance owing is due within 90 days of your corporate year end date. So for example, let's say it's March 31st. March 31st is your year end date. June 30th is when the payment needs to be made with respect to those taxes. Now, at the same token, even though that's a 90 day window, we have 180 days or six months to file our corporate tax return from that year end date. So again, March 31st, our year end filing date is September 30th. Here's the situation. If you've paid your balance owing within 90 days and there's nothing owing, there's zero late filing penalty related to, you know, not getting your taxes filed by September 30th. If it's October 15th, no penalty. If you choose to not make the payment that's owed at that 90 day period and it's still owing at filing deadline, you would have a late filing penalty. And the Penalty is essentially 5% in the initial month plus 1% per month following. So every month you're late, you get hit with another penalty. As you can imagine, 5% on the overall balance owing could be a fairly substantial amount of money. So we want to avoid that altogether. The other part that I think is important to discuss and is the fact that if we file late, our government agencies essentially have a risk profile rating. And if we're not filing on time, it enhances our risk profile rating, which ultimately could result in greater risk of being audited. So we want to always make sure that we're filing on time. It increases the risk. It also comes with penalties. With working with the right professionals, none of these should be an issue as long as you're keeping your bookkeeping up to date. So that is the risk of filing late and the outcomes related to late filing as well.