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⚠️ What Happens If You File Corporate Taxes Late? #shorts

11 Mar 2025 · 1 min

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1:08

Short explainer on consequences of filing corporate taxes late: payment and filing deadlines (payment due within 90 days of corporate year-end; return filing allowed up to 180 days / six months), the late-filing penalty structure (5% initial penalty plus 1% per month thereafter on the balance owing), and increased audit risk due to a worsened government risk-profile.

Questions this video answers

Within 90 days of the corporation's year-end date.

Within 180 days (six months) of the corporation's year-end date.

Initial penalty of 5% on the balance owing plus 1% for each month following.

Chapters

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. Any balance owing is due within 90 days of your corporate year end date. 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. If you choose to not make the payment that's owed at that 90 day period and it's still owing a 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. We want to avoid that altogether. The other part that I think is important to discuss 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.