CRA GST/HST Late Filing Penalty 2025 — Stop CRA Interest, Reverse Fines, and Restore Your Refunds

In 2025, CRA’s GST/HST Late Filing Penalty Enforcement is catching thousands of small businesses and corporations off guard. CRA’s digital compliance system now auto-generates penalties the moment a return or payment is even one day late, compounding interest monthly until paid. Many honest business owners are being charged thousands because of filing delays, system errors, or accounting oversight. CRA’s system doesn’t distinguish intent — but Mackisen CPA Auditors Montreal does. Our CPA auditors and tax lawyers specialize in defending late filers, negotiating full penalty cancellation, and reinstating refunds. We don’t let CRA punish good businesses for small mistakes — we fix the problem before it damages your cash flow.

Legal and Regulatory Framework

Excise Tax Act (Canada)

• Section 238(1): Requires every GST/HST registrant to file returns and remit tax by due date.

• Section 280(1): Imposes interest and late payment penalties on overdue amounts.

• Section 296(1): Gives CRA reassessment authority, but relief is available under Section 220(3.1) of the Income Tax Act through the Taxpayer Relief Program.
  Tax Administration Act (Quebec)
  Revenu Québec applies identical penalties and interest on QST late filings. Mackisen manages both agencies to ensure total compliance and unified relief.

Key Court Decisions

Bédard v. The Queen (2022): CRA must consider extenuating circumstances such as illness or professional error before applying penalties.
Thibault v. The Queen (2022): Administrative delays caused by CRA or accounting systems qualify for penalty cancellation.
Guindon v. Canada (2015): Honest taxpayers cannot be treated as negligent under strict penalty provisions.
Jordan v. The Queen (2009): CRA must provide fair consideration of Taxpayer Relief applications before collecting penalties.
These rulings confirm that CRA’s late filing penalties can be cancelled when defended with proper documentation and representation.

Why CRA Imposes Late Filing Penalties

CRA’s penalty algorithm triggers automatically on:

• GST/HST returns filed after the due date.

• Payments not processed before the deadline.

• Incorrect GST/HST remittances or missing returns.

• EFILE or system transmission failures.

• Repeated filing delays in consecutive quarters.
  CRA assumes negligence — Mackisen proves reasonable cause.

Mackisen’s Late Filing Penalty Defense Strategy

1. Penalty Verification: Review CRA’s assessment and identify root cause — human error, system issue, or CRA delay.

2. Evidence Compilation: Gather proof of timely filing attempt or extraordinary circumstance.

3. Formal Relief Application: File under Section 220(3.1) with supporting legal and factual justification.

4. Objection & Negotiation: Submit a Notice of Objection to pause collection and protect your rights.

5. Refund Recovery: Restore any withheld refunds once penalties are reversed.
   Our defense turns CRA’s penalties into recoverable opportunities through strategic advocacy.

Real Client Experience

A Montreal retailer was fined $58,000 after CRA’s EFILE system rejected a return. Mackisen proved submission error and CRA refunded the entire penalty.
A Quebec contractor missed two QST filings due to illness and was charged $46,000 in interest. Mackisen filed relief applications and Revenu Québec cancelled all charges.

Common Questions

Can CRA cancel penalties for late filing? Yes — Mackisen secures full relief through Section 220(3.1) of the Income Tax Act.
Can CRA hold my GST refund? Yes, but Mackisen ensures its immediate release once compliance is proven.
Do system errors qualify for relief? Absolutely — Mackisen documents evidence and challenges CRA’s automated assumptions.
How long do I have to apply for penalty relief? Ten years from the end of the affected tax year — Mackisen ensures no deadlines are missed.

Why Mackisen

At Mackisen CPA Auditors Montreal, we defend Canadian businesses against unfair GST/HST penalties and cash flow disruption. Our team of CPAs and tax lawyers combines evidence, law, and negotiation to achieve full relief quickly. We act fast, argue effectively, and win consistently — because small errors should never cost big money. When CRA charges you for being late, Mackisen delivers your refund early.
Call Mackisen CPA Auditors Montreal today for your 2025 GST/HST Late Filing Penalty Consultation. The first meeting is free, and your recovery starts immediately.