GST/HST late filing penalty: what the CRA charges for a late return and how to keep it small

What is the penalty for filing a GST return late?

If you file a GST/HST return after its due date and the return shows an amount owing, the CRA charges a late-filing penalty worked out as A + (B x C). A is 1% of the amount owing, B is 25% of A, and C is the number of complete months the return is overdue, up to a maximum of 12 (CRA, GST/HST filing penalties).

In plain numbers, the first 1% applies as soon as the return is late, even by a day, and each complete month adds another 0.25% of the balance. Twelve months is the cap, so the GST late filing penalty can never be more than 4% of the amount owing on that return.

The due date itself depends on your reporting period: one month after the period for monthly and quarterly filers, and three months after year end for most annual filers. Our GST/HST filing deadlines guide lists the dates for each period.

Is there a penalty for a late GST return if I owe nothing?

No late-filing penalty applies when the return shows $0 owing or the CRA owes you a refund, because the penalty is a percentage of the balance owing. That does not make a late nil or refund return free of consequences.

• The penalty for not filing electronically applies even to a nil or credit return, according to the CRA's 2024 notice on electronic filing.
• If the CRA sends a demand to file and you ignore it, a $250 penalty is added.
• A refund for the period, or for later periods, can wait until the missing returns are filed.
• A sole proprietor with unfiled GST/HST returns may see the CRA hold back a personal income tax refund.

If you had no sales at all, the return still has to be filed. Our guide to filing a nil GST/HST return walks through it in a few minutes online.

What other GST/HST penalties can the CRA charge?

The CRA lists several filing penalties besides the late-filing one. They can apply on the same return, so a business that files late, on paper and only after a demand could face three of them.

Electronic filing has been required for all GST/HST registrants except charities and selected listed financial institutions for returns of reporting periods ending in 2024 and later (CRA, reporting requirements and deadlines). GST/HST NETFILE and My Business Account both count as electronic filing.

How much interest does the CRA charge on late GST/HST?

Interest applies to an overdue GST/HST balance and to a late or short instalment. It is charged at the CRA's prescribed rate for overdue taxes, compounds daily, and keeps running until the balance is paid. The rate was 7% for July 1 to September 30, 2026 and is 7% for October 1 to December 31, 2026; the CRA sets it again every quarter.

The CRA's GST/HST penalty page lists interest, not a separate penalty, for paying late. Filing on time therefore matters more than paying on time: a return filed by the due date avoids the late-filing penalty even if you cannot pay, and interest then runs only on the unpaid part.

As a rough illustration, $5,000 of GST/HST paid 90 days late at 7% compounded daily costs about $87 in interest. Annual filers who also owe instalments should read our page on GST/HST instalments, because late instalments attract their own interest.

Worked example: a quarterly return filed three months late

An Ontario contractor files quarterly. His return for April 1 to June 30, 2026 shows $6,000 of net tax and was due Friday, July 31, 2026. He files and pays on Monday, November 2, 2026.

1. Complete months late: August 31, September 30 and October 31 have passed, so C = 3.
2. A = 1% of $6,000 = $60.
3. B = 25% of $60 = $15.
4. Late-filing penalty = $60 + ($15 x 3) = $105.
5. Interest on $6,000 for the 94 days from July 31 to November 2 at 7% compounded daily = about $109.

Together that is roughly $214 on a $6,000 return. Had he filed on July 31 and paid on November 2, the $105 penalty would not apply and only the interest would remain.

Can the CRA cancel GST/HST penalties and interest?

The CRA can cancel or waive GST/HST penalties and interest only in extraordinary circumstances, under its taxpayer relief provisions. Those are situations that stopped you from filing or paying on time, such as a serious illness, a natural disaster or a delay or error by the CRA itself. The tax itself is never waived.

A request can cover penalties and interest for the 10 calendar years before the year you apply. You can ask online through your CRA business account or with Form RC4288; our RC4288 taxpayer relief guide explains what to include and how long a decision takes.

How to keep a GST penalty as small as possible

• File every return by the due date, even when you cannot pay; the late-filing penalty depends on filing, not paying.
• Pay whatever you can now, since daily interest only runs on the unpaid part.
• File electronically through NETFILE or your CRA account to avoid the $100 and $250 paper-filing penalties.
• Answer a demand to file straight away, before the $250 penalty applies.
• If periods are already missed, file each one separately; every reporting period needs its own return.