COVID-19 changed tax season this year. The government announced that it was moving the deadline for individuals to file their income tax from the usual spot of April 30th to June 1st, 2020. And that’s not the only deadline they extended. Payments for 2019 taxes were pushed to September 1st, giving people just a bit more time to get their funds together.
You haven’t made your payments yet. If you’re worried about not having enough money to cover them, see what you can do before the deadline.
You know when you’re in over your head. There is no way that you can make the payments on time.
Don’t panic. You can contact the CRA to see if you can make a payment arrangement that suits your situation a little better. You might also qualify for Taxpayer Relief Provisions because of financial hardship, meaning they could pause interest, remove penalties or lower the total to make repayment easier. The solution may not make your payments disappear, but it will make them a lot easier to handle.
Another thing that you could do if you’re sure that you can’t pay is to go to a licensed insolvency trustee for professional help. A firm like David Sklar & Associates in Hamilton offers services like credit counselling and consumer proposals to give their clients debt relief, including clients who owe considerable sums to the CRA. Book a consultation to see what’s your best option.
Make a Budget
If you think that you could still make the payments by the deadline, then you need to buckle down and make a budget. This could help you save a lot of money in a short period of time. Click here to find budgeting tips for beginners and see how you can get started on making an effective budget for your household.
If you’re unsure how you can make more wiggle room in your budget for savings, here are some ideas where you can trim or cut costs entirely:
Avoid driving or rideshares when you could walk or take public transit
Make homecooked meals instead of ordering fast food
Make lists whenever you go shopping so that you don’t get any impulse purchases
Buy coffee beans and brew your coffee at home
Avoid expensive delivery fees from local stores by picking up your order
Use coupons and discount codes to save money at the register
Choose free or cheap entertainment options like streaming movies online, reading library books and playing games you already own
Call your phone/internet/cable providers to see if you can lower your service costs
What Will Happen If You Pay Late?
Missing the extended income tax deadline for your payments is going to lead to late fees and accruing interest. While it’s not the end of the world, the additional costs will make it more challenging to tackle the payments as time goes on. The longer that you take to pay, the bigger the debt gets. So, make an effort to get the responsibility covered as soon as possible.
The clock is ticking, but you still have time to reach the deadline. Start saving up your money or get the professional help you need so that you can handle your taxes this year.