“…in this world nothing can be said to be certain, except death and taxes”. While the quote originates from conversations surrounding the American Constitution, the phrase still holds relevance today. Taxes are just a financial necessity. They lay the foundation of any functioning economy and are required to be duly paid by any earning citizen.
In Canada, missed payments leads to the quiet yet quick accumulation of “Back Taxes.” These accumulate very similarly to bad credit card debt. If you’ve accrued back taxes, and are quite confused as to how, you may need a deeper understanding of taxes as whole.
Here are some considerations regarding taxes, back taxes, along with the benefits of settling them:
How Back Taxes Accumulate?
Each earning member has certain tax obligations in accordance to their income. As such, back taxes typically accrue when individuals fail to fulfill their tax obligations promptly. This can result from unfiled tax returns, underreported income, or simply neglecting to pay owed taxes. The longer these taxes remain unpaid, the more interest and penalties accumulate, compounding the financial burden.
Is Paying Back Taxes Mandatory?
Certainly, paying back taxes is a mandatory obligation. Tax authorities expect individuals to settle their outstanding tax liabilities promptly. Failing to do so can result in severe consequences, including penalties, interest charges, and legal actions. Ignoring back taxes may lead to wage garnishments, bank levies, or even liens on property, making it imperative to address these financial obligations promptly.
Are There Benefits to Paying Back Taxes?
While paying back taxes can be quite a daunting endeavour, there are benefits to working towards a ‘back tax-free’ future.
Firstly, unpaid back taxes keep accumulating penalties and interest. This means that your owed amount can balloon into a potentially unmanageable mess. Paying back taxes completely negates this occurrence. But what happens when the fear of debt is not enough? Authorities may often resort to legal methods to deal with a suspected tax evader. This can completely disrupt daily peaceful living. Negating this possibility is also important. Finally, any debt or dues are associated with psychological turmoil. When you resolve back taxes, you take a significant financial burden off your shoulders!
So far, 3 challenges seem prominent
- Back Taxes may accumulate
- Back Taxes may have been accumulating
- Back Taxes must be cleared
As an individual, you can utilize Accotax back year taxes service to resolve any potential concern regarding back taxes. This ensures that a certified expert understands your situation, negotiates with the authorities, and helps put you on the best path towards financial safety!