Can I Avoid Penalties on T1135 Late Filing
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Can I Avoid Penalties on T1135 Late Filing?
Worried about filing your income tax returns? Did you forget to 
consider your foreign rental income? Now you are worried about the 
penalties.
What if we tell you that there is a way around it? So, can you really 
avoid penalties on T1135 late filing? Read on to learn more.
What is the T1135 Form?
The CRA, short for the Canada Revenue Agency uses the T1135 form 
to obtain information on the number and income generated through 
foreign assets that are held by the residents of Canada. Form T1135 
is also known as Foreign Income Verification Statement.
Who should Fill it?
You must file the T1135 form, also known as the Foreign Income 
Verification Statement if you own foreign property worth more than 
100,000 Canadian Dollars at any time during the year. This is 
applicable to all individuals, trusts, and partnerships.
When completing the foreign income verification statement, you 
must consider the property's cost rather than its current value. 
An individual need not complete the T1135 form if they purchased 
the land for less than 100,000 Canadian Dollars and its current value 
exceeds 100,000 Canadian Dollars.
You are also exempt from declaring mutual funds registered in 
Canada that invest in foreign stocks and personal property. You can 
also exclude vacation property that you use primarily as a personal 
residence. Funds in your pension plan, income, or property that you 
use exclusively related to your active business can also be omitted.
What is the Penalty for T1135 Late Filling?
Failure to submit the foreign income verification statement on time 
may result in a penalty of $25 per day. This fine can go up to as 
much as $2,500 per year.
How can I Avoid Penalties on T1135 Late Filing?
A Canadian taxpayer can apply to lighten the late filing penalties 
through CRA’s Voluntary Disclosure Program (VDP). This is 
applicable to the ten prior taxation years. The CRA's VDP provides 
taxpayers with a second chance to correct unintentional errors or 
omissions in their income tax returns. One might get relief from the 
penalties for the late filing of the T1135 form through VDP. But 
keep in mind that they are still required to pay any taxes and 
interest owing.
Not that the Voluntary Disclosure Program applications filed by 
those who have purposefully avoided their tax obligations will not 
be granted the same relief as those who want to correct an 
unintentional error.
Hope all your question on T1135 Late filing penalties were answered 
through this article. If you have any further queries let us know in 
the comments. More information contact 
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3-100 Hanlan Road, Woodbridge, ON L4L 4V8
Phone: (647)724-4308
Email: [email protected]
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