The benefits of paying your taxes online, and on time
When it comes to paying taxes, many people still go through the process of issuing a cheque to the CRA. And while there’s nothing wrong with getting out the ol’ cheque book, it’s actually much easier, faster and even cheaper to pay online – plus it’s as secure as paper payment.
If you’re someone who pays taxes in installments (maybe you’re self-employed or your employer doesn’t deduct enough income tax from your paycheck), online payment has even more perks. Reason being, you can set up payment in regular installments, which means you can forget about missing deadlines.
And, as if you needed another reason to consider online as an option, payment online means you can do it from anywhere – the beach, commuting to work or at home in your PJ’s.
Given that filing taxes online can be faster and easier than writing a cheque, it may also help to decrease the risk of filing late. It’s important to pay taxes on time, as you’ll run into interest on the amount owed, which can add up quickly! For example, if you have a balance owing for 2018, the CRA charges compound daily interest starting May 1, 2019 on any unpaid amounts owing for 2018. This includes any balance owing if they reassess your return. In addition, they will charge you interest on the penalties starting the day after your filing due date. Plus, the rate of interest charged can change every three months – yikes!
If you have amounts owing from previous years, the CRA will continue to charge compound daily interest on those amounts. Payments you make are first applied to amounts owing from previous years, which can make it hard to catch up, and is why it’s so important not to fall behind.
If you’re interested in learning more about how to set up online payments to the CRA visit www.hrblock.ca to find a location nearest you to chat with one of our tax professionals.