You May Have Until June 15th to File, But You Should Pay Now

Taxpayers who report self-employment income on their personal tax return have until June 15th to file their returns. However, they do not have any longer to make the payment, if they owe money. This is one of those situations which confuses people who have chosen not to be a tax professional.

Every individual taxpayer must pay their taxes by April 30th or interest starts to accrue. The 2021 tax returns were due by May 2nd this year, because April 30th fell on a Saturday. So, all payments had to be made by May 2nd.

The reason that self-employed taxpayers have longer to file is because more than 20 years ago CRA changed all of the year-ends for self-employed people to December. Prior to that a person could have a tax year that ended at any time in the year. We used to have a lot of January year-ends. You would report on your 2010 tax return the income you earned for the year-ended January 31, 2010. So, this meant we could have prepared that January year-end during the summer of 2010 and come April of 2011 we just had to enter the numbers. The bookkeeping was done much earlier.

When CRA made everyone have December year-ends accountants were no longer able to spread the workload out, so we needed more time to complete all these year-ends. The question I get asked is, what is the point of having longer to file if I still have to do the return to figure out if I owe money? Of course, only the government can answer that question.