“If you’re required to pay your taxes in installments, don’t put off sending in your return,” advises Chartered Accountant Rob Chaggares of Rumley & Chaggares in Newmarket.
If you fail to pay the required amounts on time, you could be charged substantial interest and penalties by the Canada Revenue Agency (CRA).
Not all taxpayers are required to pay tax installments. In 2008, you qualify if total taxes (including Old Age Security repayment but not Canada Pension Plan contributions) exceed income tax withheld from income and provincial tax credits by more than $3,000.
“CRA determines who is required to pay installments and mails those taxpayers installment reminders. If you don’t receive a reminder, you don’t have to make installments, even if your tax liability clearly exceeds the $3,000 limit,” says Chaggares.
“If you do receive a reminder, remember that it’s based on past information. If you’re certain that your current year’s unpaid liability when you file your return will not exceed $3,000, then you are not required to make installments, and you can ignore the reminder notices.”
Brought to you by the Institute of Chartered Accountants of Ontario.
The Institute of Chartered Accountants of Ontario is the qualifying and regulatory body of Ontario’s 33,000 Chartered Accountants and 5,000 CA students. Since 1879, the Institute has protected the public interest through the CA profession’s high standards of qualification and the enforcement of its rules of professional conduct. The Institute works in partnership with the other provincial Institutes of Chartered Accountants and the Canadian Institute of Chartered Accountants to provide national standards and programs that are used as examples around the world. </em>
