Part XIII witholding penalty

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ruib77
Posts: 41
Joined: Sat Jul 14, 2012 10:17 pm

Part XIII witholding penalty

Post by ruib77 »

I had pre authorized debit setup with CRA for rental tax witholding of Part XIII at 25% rate. I was not aware that it expired in May 2018 and payment stopped since then. Once I learnt few days back I re-setup for another 24 months of upcoming monthly payments. I also paid the remaining unpaid remittance of 2018 online.

Usually witholding amount is around 4 times of actual tax that I pay after all credit and deductions. So, during Jan to May 2018 enough money was withheld to cover taxes for the entire 2018. CRA site says anything over 7 days delay will be penalized at 10% rate. Question is, will it be applicable for my scenario?

Thanks.
nelsona
Posts: 18311
Joined: Wed Oct 27, 2004 2:33 pm
Location: Nowhere, man

Re: Part XIII witholding penalty

Post by nelsona »

Contact CRA. It is due every month, so is late. The interest rate is 6% currently.

You should consider filing an NR6, to reduce the amount of withholding you are subject to 25% of your NET.

I assume when you say "credits and deductions" you mean rental expenses, since there are only a few rare deductions given on a 216 return.
nelsona non grata. Non pro. Please Search previous posts, no situation is unique as you might think. Happy Browsing :D
myusername
Posts: 4
Joined: Fri May 28, 2021 1:27 pm

Re: Part XIII witholding penalty

Post by myusername »

Hey Ruib77,
How did you setup your pre authorized debit with CRA for rental tax witholding of Part XIII at 25% rate?
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