Late-Filing Penalty & Interest Calculator
This late filing penalty calculator estimates what a late income tax return will cost under CRA rules — the 5%+1%/month filing penalty plus daily-compounded interest on the balance owing
Common Accounting Corp. · Tools
Late-Filing Penalty & Interest Calculator
Usually Apr 30 (or Jun 15 if self-employed — balance is still due Apr 30)
Defaults to today — change to test a future filing date
$
Tax owed at the filing deadline, before penalty/interest
%
Changes quarterly — confirm current rate on CRA's site
Penalized for late filing in any of the past 3 tax years
Raises the penalty to 10% + 2%/month (max 20 months, 50% total)
Balance owing entered
Enter a balance to calculate
Amount owingOriginal balance at the filing deadline
$0.00
Late-filing penalty5% + 1%/month
$0.00
InterestDaily-compounded from the due date
$0.00
Total owing
$0.00
Estimate only, for planning purposes — not a Notice of Assessment. Penalty follows ITA s.162(1): 5% of the balance owing plus 1% per complete month late (capped at 12 months), or 10% + 2%/month (capped at 20 months) for a repeat late filer assessed in any of the prior three years. Interest is estimated at the entered annual rate, compounded daily on the original balance from the due date — CRA's actual calculation also compounds interest on the penalty once assessed and the prescribed rate changes quarterly, so your Notice of Assessment may differ slightly. If you're owed a refund, no late-filing penalty applies.
Have a CRA letter in hand, or need help with an actual filing? Talk to us.
How This Late Filing Penalty Calculator Works.
This late filing penalty calculator follows the formula the Canada Revenue Agency actually uses under subsection 162(1) of the Income Tax Act. When a personal tax return is filed after the deadline and there is a balance owing, the CRA applies a flat 5% penalty on that balance, plus an additional 1% for every complete month the return remains unfiled, up to a maximum of 12 months. That caps the first-time penalty at 17% of the balance owing. If a taxpayer was already charged a late-filing penalty in any of the previous three tax years, the CRA treats the new late filing as a repeat offence.
In that case the penalty roughly doubles: 10% up front, plus 2% for every complete month late, capped at 20 months.
On paper that can reach as high as 50% of the balance owing, which is why catching a second late filing early matters so much.
Interest is calculated separately from the penalty and compounds daily on the unpaid balance from the original due date,
using the CRA’s prescribed interest rate, which is reviewed and published every quarter. Because the rate moves throughout the year, this calculator lets you enter the current rate manually rather than assuming a fixed number that could quickly go stale.
One detail people often miss: if a return is filed late but there is no balance owing — for example, the taxpayer is owed a refund
— no late-filing penalty applies at all under CRA rules, regardless of how many months have passed. The penalty is tied directly to
having unpaid tax at the deadline, not simply to the act of filing late.
This late filing penalty calculator is meant for planning purposes, so you can see roughly what a late return will cost before committing to a filing date, or explain the numbers clearly to a client who is deciding whether to file now or wait. For an exact figure tied to a specific Notice of Assessment, the CRA’s own calculation should always be treated as the final word.
