T5 summary late penalty

Tax Topics
1

I have a T3 and T5 return to file for 2022. There is one T3 slip and one T5 slip. The slips each have a flat penalty of $125 each. The T3 return has a $10/day penalty, max $2,500. But the CRA guide on penalties says a T5 return will incur a penalty from $100 to $7,500, but there’s no indication how this is calculated. Doed anyone know the method for the T5 return (The T5 summary,NOT the T5 slips)??

2

Any time I’ve late filed a T4 or T5 return, there has only been a single $100 penalty, regardless of the number of slips included. I remember reading, somewhere on CRA website, the criteria for the larger penalties, but they generally don’t apply to your typical small business client.

Have they upped the standard penalty to $125 now? I haven’t checked recently.

3

Last one I saw was still $100.

4

The penalty for late filing of information returns listed in Income Tax Regulation 205(3), including the T5 Summary and Supplementaries, is laid out in subsection 162(7.01) if the Income Tax Act, and depends in part on the number of slips:

Every person (other than a registered charity) or partnership who fails to file, when required by this Act or the regulations, one or more information returns of a type prescribed for the purpose of this subsection is liable to a penalty equal to the greater of $100 and

(a) where the number of those information returns is less than 51, $10 multiplied by the number of days, not exceeding 100, during which the failure continues;

(b) where the number of those information returns is greater than 50 and less than 501, $15 multiplied by the number of days, not exceeding 100, during which the failure continues;

(c) where the number of those information returns is greater than 500 and less than 2,501, $25 multiplied by the number of days, not exceeding 100, during which the failure continues;

(d) where the number of those information returns is greater than 2,500 and less than 10,001, $50 multiplied by the number of days, not exceeding 100, during which the failure continues; and

(e) where the number of those information returns is greater than 10,000, $75 multiplied by the number of days, not exceeding 100, during which the failure continues.

Paragraph (e) is the basis for the $7,500 figure.

1 Like
5

Gotcha. Thanks so much.