He may give you the chance to file under the next application Voluntary Disclosure Program (VDP). According to the Canada Revenue Agency (CRA), “the VDP provides relief on a case-by-case basis to taxpayers and registrants who volunteer to pre-correct errors or omissions in their tax returns.” [CRA] know or contact them about it.”
If your friend owes taxes, he or she’s going to still must pay them, but late filing penalties and a few or the entire interest could also be waived.
If you reside together, the CRA will probably classify you as common law, Alison. This is since the agency’s common law definition includes partners who’ve lived together in a conjugal relationship for a minimum of 12 consecutive months. The yr you reach that 12-month mark is when you must file your common law tax return. And you must notify the CRA by the top of the month following the month wherein your status modified.
Common law tax advantages
Here are a few of the implications of registering as a domestic partner:
- Eligibility for some government advantages relies on family income reasonably than individual income
- Common law spouses can mix medical expenses and donations and will receive a greater overall tax savings than in the event that they filed single
- If your income is low, partners can claim a so-called tax credit Spouse or civil partner amount
- Spouses can contribute to a spousal RRSP
- Spouses can share eligible retirement income
In your case, Alison, your boyfriend’s low income in 2020 and no income since then may qualify you to assert the above spouse or domestic partner amount as a tax credit. The savings for 2024 are as much as $2,356 federally and between $532 and $2,189 provincially, depending on where you reside.
However, should you receive advantages akin to the Canada Child Benefit, GST/HST credit, Canada Carbon Rebate (formerly referred to as Climate Active Stimulus Payments), or Guaranteed Income Supplement (GIS), these advantages may change whenever you update your common law filing status .
Why do you have to hassle together with your taxes?
At some point your friend must get his taxes sorted and updated, Alison. It is best to do that voluntarily than to have the rating agency impose heavy penalties and interest. If your friend lives with you and is supported by you, his financial situation has a direct impact on yours. It also has indirect effects in your tax return and government advantages.
When you file your tax return, you certify that the data provided in your tax return is accurate, complete and fully discloses your entire income. That’s why you must file your taxes accurately, Alison, even in case your boyfriend is behind on his own tax returns.
