What happens if I miss my HST filing deadline in Ontario?

CRA imposes a late-filing penalty under Excise Tax Act s. 280.1 equal to 1% of the amount owing plus 25% of that 1% for every complete month the return is late, capped at 12 months. Daily arrears interest under s. 280 also accrues at the prescribed rate on unpaid tax and penalties.

Formula: penalty = A + (B x C), where A = 1% of unpaid net tax, B = 25% of A, C = number of complete months late, max 12. Interest under s. 280 is compounded daily at the prescribed rate (currently 8% for overdue balances as of early 2026; check the current CRA quarterly rate).

Example: an Ontario contractor owes $15,000 net HST on a Q1 2026 return due April 30, 2026, but files September 30, 2026 (five complete months late). Penalty = 1% x $15,000 = $150 (A); B x C = $37.50 x 5 = $187.50; total penalty = $337.50. Interest accrues on top from May 1, 2026 onward.

Worse consequences: repeated failure to file within four years of prior demands can trigger a 5% + 1% per month additional penalty under ETA s. 280.11. CRA may also arbitrarily assess your net tax under s. 299 based on GIFI or bank statements, usually to your disadvantage.

Note: If a nil return is late CRA still opens the account; the penalty base is zero so no dollar penalty, but the compliance flag remains and may affect future GST/HST refund releases.

Source: canada.ca — Interest and penalties on late GST/HST

— Bader A. Chowdry, CPA, CA, LPA — Insight Accounting CPA

Disclaimer: Bader A. Chowdry, CPA, CA, LPA is a Licensed Public Accountant regulated by CPA Ontario. Insight Accounting CPA Professional Corporation is a Chartered Professional Accountant firm. This content is general information only and does not constitute professional advice for your specific facts. Confirm current rules and figures with your own advisor before acting.