We all know the importance of paying our taxes. But what happens when you’re late? Is your business penalized?Joining us now to speak about late tax payment, we have Education Officer at Tax Administration Jamaica, Courtney Johnson.

Form, forms and more forms; filing taxes can be really intimidating, especially for business owners who are doing everything by themselves. It gets even more complicated when deadlines for filing are missed.

However, Education Officer at Tax Administration Jamaica (TAJ), Courtney Johnson said there are a number of steps the people can take to ease the burden of tax season.

Speaking on an episode of MoneyMovesJa with Kalilah Reynolds, Johnson said that there are two important dates that individuals must remember during tax season.

He said that the deadline for filing income tax related returns is usually March 15, unless an extension is given by the TAJ.

Johnson said that income tax related returns can refer to company, partnership, corporate bodies, charitable bodies or self employed income taxes.

“So, if you’re in any of those categories, you are required to meet the March 15 deadline of each year. March 15 is the time when every person, and every person in tax laws means a corporate body, an individual or a partnership, is required to file a return declaring all of their activities for the year that just passed,” he explained.

The Education Officer said that the other important date in March for business owners is March 31. This is the deadline for employers to file returns for their employees, which declares how much employees earn yearly.

Johnson said if the returns aren’t filed by the deadlines then the individual or company will need to write a formal request to the Commissioner General of TAJ asking for a waiver of the penalties associated with missing the deadlines.

“Your request is ‘requesting a waiver of the penalties and interests on my income tax account’. In that letter you’re going to state your name, the name of the entity, the TRN (tax registration number) of the entity and the period for which you are requesting the waiver,” he said.

According to Johnson the letter should also include a strong and clear explanation of why the deadlines were missed as well as accurate, up-to-date contact information. He noted that it is at the discretion of the Commissioner on which appeals to grant and which to decline. Johnson said that the Commissioner can grant a full or partial waiver of the penalties.

If the request is denied or none was made, there is a $5000 late fee for outstanding income tax filings. The Education Officer noted that the fee is charged every month or part thereof until the returns are filed.

He further explained that if an individual missed the TAJ’s extended deadline of March 22, then $5000 will be owned for March. If the returns are still not filed by April 1, then an additional $5000 will be added.

“So it is important that you reach out to the tax department and say ‘hey, I need help in filing my return and I need help before this $5000 is added’,” he said.

In addition to the $5000 late fee, Johnson said that 20 percent interest will be payable on any outstanding tax balances. He noted, however, the interest is calculated per annum and not monthly.

Johnson acknowledged that the process of filing taxes can be complex and people, especially small and medium sized business owners may get confused about the correct forms to fill out. However, he said that once all the information on the form is accurate, then the individual or company can write to the TAJ requesting a change in the type of filing.

He also noted that the TAJ has a department dedicated to identifying these types of errors and bringing them to the customers’ attention. He also said that if there is an error in the amount of taxes that the company or individual works out that they should pay, then the TAJ will reach out and highlight the discrepancy.

“We want to ensure that everyone is paying their fair share; no more, no less,” he said.

Johnson said that TAJ also has payment plan options available for individuals who do not have all the money available at once to pay off their taxes.

He said that customers can use TAJ’s online portal to sign up for a payment plan. Through the portal they will be able to input the amount of taxes owed and select the time frame over which they would make payments. The portal will then calculate the amount that needs to be paid monthly.

On the other hand, customers can also visit their nearest tax office and speak to a compliance officer, who will be able to go over the taxes with the individual and decide on the best way forward.

Visit EXIM Bank’s Business Advisory Service at:
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