Table of penalties

In this table, "Yes" means that you may face a penalty for non-compliance, while "No" means you won't face a penalty.

For details, click on the hyperlinked section of the Income Tax Act in the table's left-hand column.

Failure to file

• 162(7) - Failure to comply -- The penalty for failing to file a return is $25 per day for up to 100 days (minimum $100 and maximum $2,500).
  
  
• 162(10)(a) - Failure to furnish foreign-based information -- Where the failure to file is done knowingly or under circumstances amounting to gross negligence, the penalty is $500 per month for up to 24 months (maximum $12,000), less any penalties already levied. This penalty does not apply to Form T1142.
  
  

Top of Page

• 162(10)(b) - Failure to furnish foreign-based information -- Where a demand to file a return is issued under subsection 233(1) and the person or partnership knowingly or under circumstances amounting to gross negligence fails to comply with the demand, the penalty is $1,000 per month for up to 24 months (maximum $24,000), less any penalties already levied. This penalty does also apply to Form T1142.
  
  
• 162(10.1) - Additional penalty -- After 24 months, the penalty becomes 5% of whichever of the following resulted in the requirement to file the information return, less any penalties already levied: the cost of the foreign property; the fair market value of the property transferred or loaned to the trust; or the cost of the shares and indebtedness of the foreign affiliate. This penalty does not apply to Form T1142.

Top of Page

False statements and omissions

• 163(2.4) -- This penalty applies to people who -- knowingly or under circumstances amounting to gross negligence -- make false statements or omissions in an information return.

  In the case of Form T1142, the penalty is the greater of either $2,500 or 5% of whichever of the following the false statement or omission was made about: the fair market value; distributed property; or unpaid indebtedness.

  In the case of the other information returns, the penalty is the greater of either $24,000 or 5% of whichever of the following the false statement or omission was made about: the cost of the foreign property; the fair market value of the property transferred or loaned to the trust; or the cost of the shares and indebtedness of the foreign affiliate.

Top of Page

Due diligence exception

• 233.5 -- The penalty for omissions in Forms T1134 and T1141 is not applicable to taxpayers who make diligent efforts to obtain the requested information and who:
  
  
  • disclose in the return the unavailability of the information
  • file the information within 90 days of it subsequently becoming available.