How to Avoid GST/QST Late Filing Penalties: A Timely Filing Guide

Introduction

Missing a GST/QST filing deadline in Quebec can be far more costly than most business owners realize. Beyond simple interest charges, late filings can lead to compounded penalties, frozen accounts, and in severe cases, personal liability for directors.

This guide from Mackisen CPA Montreal explains exactly how to avoid GST/QST late-filing penalties, what Revenu Québec and the Canada Revenue Agency (CRA) consider late, how penalties are calculated, and practical CPA strategies to ensure your business stays compliant—every period, every year.

Legal and Regulatory Framework

GST and QST returns are governed by:

• Excise Tax Act (R.S.C. 1985, c. E-15) — federal GST rules.

• Quebec Sales Tax Act (R.S.Q., c. T-0.1) — provincial QST rules.

• Tax Administration Act (RLRQ, c. A-6.002) — authorizes Revenu Québec to collect, assess, and enforce tax debts.

Under these laws, every registered business must file its GST and QST returns on time, even if:

• No tax is owed (nil return).

• The business is temporarily inactive.

• The return is filed for a dissolved or seasonal business.

Failing to file or remit on time results in automatic interest and late penalties, which accrue daily.

Filing Frequency and Deadlines

• Monthly: Due the last day of the following month.

• Quarterly: Due one month after the quarter end.

• Annual: Due three months after fiscal year-end.

Revenu Québec does not issue reminders—businesses must track deadlines themselves.

Learning Insight

Even one missed filing can flag your account for compliance monitoring, increasing audit likelihood for future years.

Understanding Late Filing Penalties

1. Late Filing Penalty

Revenu Québec applies a base penalty of 5% of the balance owing, plus 1% per month (up to 12 months) until the return is filed.
For example:
If you owe $10,000 and file 3 months late:
5% ($500) + 3% ($300) = $800 penalty, plus daily interest.

2. Repeated Late Filing

If you file late again within four years, penalties double. Revenu Québec may also suspend your account or require a security deposit to reopen GST/QST accounts.

3. Interest Charges

Interest is compounded daily at the prescribed rate (currently between 8% and 10% annually, updated quarterly). Interest starts the day after your due date, not the filing date.

4. CRA and Revenu Québec Coordination

Both agencies share information. A late GST return with CRA automatically alerts Revenu Québec for QST follow-up.

Learning Insight

Filing on time, even without full payment, avoids the 5%–20% late-filing penalty. You can always negotiate a payment plan—but you can’t reverse an unfiled period.

Common Causes of Late Filing

• Forgetting the $30,000 registration threshold and filing retroactively.

• Not tracking multiple filing frequencies (monthly/quarterly).

• Waiting for missing receipts before filing.

• Staff turnover or change of accountants.

• Confusion over combined GST/QST forms.

Learning Insight

Revenu Québec’s systems are automated. If a return is not received, penalties start automatically—even if no reminder was sent.

How to Avoid Late Filing Penalties: CPA-Backed Strategy

1. Set Up a Filing Calendar

Use a cloud-based calendar (Google, Outlook, or QuickBooks reminders) with recurring due dates. Add alerts 10 days before and on the deadline date.

2. File Early

Don’t wait until the last day. System maintenance or network issues can delay submissions on Mon dossier pour les entreprises. File 3–5 days early whenever possible.

3. File Even Without Full Payment

Submit your return on time and pay what you can. Revenu Québec allows payment arrangements but not late filings. Filing shows good faith and prevents criminal misappropriation assumptions.

4. Automate Accounting

Use accounting software that tracks GST and QST balances in real time. Automate report generation and filing reminders.

5. Maintain Proper Records

Keep six years of supporting documentation (invoices, receipts, reconciliation reports). Missing records are not an excuse for late filing.

6. Delegate to a CPA

Grant your CPA Mon dossier access. Mackisen CPA monitors deadlines, prepares returns, and confirms submission receipts on your behalf.

Learning Insight

Proactive CPA oversight reduces missed deadlines by up to 90%. Businesses that delegate filing responsibility maintain better compliance and fewer audit risks.

Real Quebec Business Examples

• A restaurant that filed one quarter late owed only $3,500 but paid $1,000 in penalties and interest.

• A construction company ignored a QST notice for two years; Revenu Québec registered a tax lien against its commercial property.

• A retail shop repeatedly missed nil returns; CRA flagged it for audit and suspended its GST account.

Lesson: Consistent filing protects your reputation, credit, and operating licenses.

Common Questions

Do I still need to file if I made no sales?
Yes. File a nil return to avoid default penalties.

Can penalties be cancelled?
Sometimes. You can request Taxpayer Relief if you had extraordinary circumstances (illness, disaster, accountant error). Mackisen CPA can prepare the relief submission.

What if I can’t pay?
File anyway. CRA and Revenu Québec will negotiate payment terms, but they cannot waive penalties for unfiled periods.

What if I just started my business?
Your first filing date is based on your registration approval letter. Track it carefully—late first filings are common errors.

How long before enforcement starts?
Interest and penalties start immediately after the due date. Garnishments or seizures typically begin after 90 days of non-response.

Compliance Checklist

Do

• File every period, even with no sales.

• Mark deadlines in your business calendar.

• File before payment if necessary.

• Keep proof of filing and payment.

• Consult a CPA for missed filings or penalty relief.

Don’t

• Wait for a reminder from Revenu Québec.

• File only once per year if you’re a quarterly or monthly filer.

• Use business funds for personal expenses before remitting GST/QST.

• Assume nil activity means no filing obligation.

Mackisen Strategy

Mackisen CPA Montreal ensures on-time filing and penalty prevention through:

1. Automated GST/QST filing systems integrated with Mon dossier.

2. CPA-supervised compliance calendar and alerts.

3. Penalty relief submissions for past-due accounts.

4. Full representation in discussions with Revenu Québec or CRA.

Our bilingual tax team prevents late filings before they happen and defends you when they do.

Why Mackisen

With over 35 years of combined CPA experience, Mackisen CPA Montreal helps Quebec businesses stay compliant, avoid penalties, and maintain full credibility with Revenu Québec and CRA. We specialize in small-business accounting, tax representation, and penalty prevention.