May 1: Deadline for Outstanding 2020 Balances

Walter Harder

There is an important deadline coming up for those who received a reprieve on their 2020 outstanding balances: interest will accrue on that balance starting May 1, 2022. Who does this deadline apply to?

Taxpayers who had a balance due on their 2020 tax returns were not charged interest on that balance if their taxable income for 2020 was less than $75,000 and they received pandemic relief benefits in 2020. However, interest will now start to accrue as of May 1, 2022.

Interest will be payable at the current rate of 5% per annum, compounded monthly. That interest could be reduced or eliminated if the taxpayer files their 2021 return on time and has a refund that can be used to offset the outstanding balance. With the tax deadline fast approaching, now is the time to act!

Additional educational resources: Don’t miss this opportunity to take Canada’s most up-to-date and comprehensive Advanced T1 Tax Update Course for Professional Tax Accounting firms and their new and returning staff who will file 2021 T1 Returns. This is Canada’s #1 tax training program for busy practice owners who need to recruit and train staff in time for this tax season.