CRA Late Filing Penalties 2025 — Stop Interest, Remove Fines, and Regain Compliance

Every year, thousands of Canadians miss CRA filing deadlines — often due to illness, business stress, or simple oversight — and pay the price. In 2025, CRA’s penalty system is fully automated, applying late filing fines the moment a return is overdue. The penalties add up fast: 5% of the unpaid balance immediately, plus 1% for every additional month — up to 12 months. For repeat late filers, the fine doubles. Add daily compounded interest, and a small mistake can turn into a devastating financial burden.

The good news: CRA penalties can be reversed, reduced, or completely cancelled. At Mackisen CPA Auditors Montreal, we fight to remove late filing penalties and restore compliance. Our CPA auditors and tax lawyers prepare evidence-based Taxpayer Relief Applications, negotiate directly with CRA officers, and build airtight justifications that save our clients thousands.

When the CRA penalizes you for falling behind, Mackisen helps you get ahead again.

Legal and Regulatory Framework

Income Tax Act (Canada)

• Section 162(1): Applies 5% late filing penalty plus 1% per month (maximum 12 months).

• Section 162(2): Doubles penalties for repeat late-filers within three years.

• Section 161(1): Accrues daily compounded interest on unpaid balances until resolved.

• Section 220(3.1): Grants CRA discretion to cancel or waive penalties and interest under the Taxpayer Relief Program.

Tax Administration Act (Quebec)
Revenu Québec imposes similar penalties — 5% of the balance plus 1% per month — but also offers interest relief for proven financial hardship or exceptional circumstances.

Mackisen handles both CRA and Revenu Québec filings and relief requests simultaneously to ensure total compliance and protection.

Key Court Decisions

Guindon v. Canada (2015): CRA’s late filing penalties are valid until formally challenged through objection or relief.
Campbell v. The Queen (2017): CRA must consider taxpayer hardship, illness, or errors caused by professional advisors.
Browne v. The Queen (2022): Courts recognize personal hardship as valid grounds for penalty cancellation.
Jordan v. The Queen (2009): Timely evidence and representation increase the likelihood of successful relief.

These rulings confirm one truth: late filing isn’t fatal — unless you stay silent.

Why CRA Applies Late Filing Penalties

CRA penalties are designed to enforce compliance but often punish taxpayers who’ve faced legitimate challenges. Common causes include:

• Serious illness, family emergencies, or death in the family.

• Financial or business hardship.

• Accountant or tax preparer error.

• CRA or Revenu Québec processing delays.

• System or electronic filing issues.

Most taxpayers want to comply — they just need time, clarity, and fair treatment. Mackisen ensures CRA recognizes that.

Mackisen’s Late Filing Penalty Relief Strategy

1. Case Evaluation: Review your tax history, notices, and financial circumstances.

2. Relief Application Preparation: File a detailed Taxpayer Relief request under Section 220(3.1) with supporting documents.

3. Evidence Building: Provide medical records, hardship statements, or professional correspondence proving your case.

4. Negotiation & Representation: Engage CRA’s Relief Division or Revenu Québec directly to argue for full cancellation.

5. Future Compliance Plan: Implement proactive filing systems to prevent future penalties.

We combine facts, compassion, and compliance to convince CRA that your penalties don’t reflect your intent — only your situation.

Real Client Experience

A Montreal consultant was charged $8,900 in late filing penalties after hospitalization. Mackisen provided full medical documentation and secured 100% relief.
A small business owner faced $32,000 in CRA and Revenu Québec late filing fines due to accountant errors. Mackisen filed dual relief requests — both agencies cancelled the penalties in full within 60 days.

Common Questions

Can CRA remove late filing penalties? Yes — under the Taxpayer Relief Program, if you prove illness, hardship, or CRA error.
Will interest also be waived? Often, yes — CRA can reduce or cancel related interest charges.
Can I still file returns years late? Yes — CRA will process them once penalties are resolved.
What if this happens again? Mackisen can set up structured filing systems and monitor deadlines for future compliance.

Why Mackisen

At Mackisen CPA Auditors Montreal, we believe good taxpayers deserve fair treatment. Our team has successfully removed millions in CRA and Revenu Québec late filing penalties by proving one simple truth: intent matters. Whether you were sick, struggling, or misadvised, we ensure CRA sees the full picture — not just the numbers.

We fight for your rights, your relief, and your recovery — because falling behind once shouldn’t cost you forever.

Call Mackisen CPA Auditors Montreal today for your 2025 Late Filing Penalty Relief Consultation. The first meeting is free, and your path to relief starts immediately.