The dreaded tax season is finally here. Tax season is one of the most stressful times of the year. Every time it rolls around, people begin scrambling to get all of their papers and finances in order. Individuals around the nation are particularly feeling stressed after the financial devastation that the Coronavirus pandemic caused, making tax return filing more complicated.

The CRA is Offering Interest Relief

You may have heard that the CRA is giving a one-year interest relief on 2020 income tax. It may sound like a dream, but it's true.

As most of us know, the CRA charges an interest rate for income tax that is owed following the initial deadline. The interest rate leads individuals to pay more money that they may not have. This year income taxpayers are being given tremendous relief with the CRA wavering their interest fees until April 30th, 2022.

If you have not filed your yearly income taxes yet, we suggest you read this article and see if you are eligible for this fantastic money-saving offer.

Are You Eligible for Interest Relief?

Interest relief is one of the best ways you can save money during tax season. But first, you have to see if you meet the eligibility requirements the CRA has put in place. Below you will find the two main conditions that determine if your eligible for this offer.

●      You made less than $75,000 of taxable income in 2020

●      You received certain COVID-19 benefits in 2020 

Those benefits include the following.

●      Canada Recovery Sickness Benefit

●      Canada Emergency Response Benefit

●      Canada Recovery Caregiving Benefit

●      Employment Insurance Benefit

●      Canada Recovery Benefit

●       Canada Emergency Student Benefit

You must meet both of these requirements to receive a year of interest relief from the CRA. Taxpayers should also be aware that the interest relief offer does not apply to outstanding debts.

You Can Still Receive a Penalty

The CRA is still issuing a 5% penalty for late income tax return filings. Consequently, this will increase the amount of your overall tax bill. If you continue to fail to file your income tax returns, the CRA will add an additional 1% penalty for up to twelve months. 

To stay on the safe side, make sure your income tax return is filed by the deadline. Mark the deadline on your calendar. 

What is Considered Tax-free Income?

One way you may have received tax-free income in the year 2020 is by receiving COVID-19 benefits and placing a portion of it into a Tax-Free Savings Account (TFSA).

This one-year of interest relief may be able to help you recoup from the financial devastation of 2020. Always continue to do research on other accommodations the CRA may have to offer income taxpayers.

If you need further help keeping your financial matters in order, consider enlisting the services of an accountant. Accountants are not just for business owners. They can also help everyday people just like you keep track of their income, personal expenses and interpret financial documents.

Contact your Accountants today click on this link —> https://capexcpa.com/contact

- The Capex Team