When taxpayers receive the dreaded tax notice that their tax return or their business is going to be audited and examined, the first thing they should do is seek professional tax advice. Same thing when taxpayers receive collection letters threatening their wages or paycheques, or the tax levy letter for their bank account, taxpayers should seek professional tax advice to resolve their tax problems. Continue to read on to learn about which tax issues can arise as a result of failed payments, and how you can rectify them.
Some tax issues you may face are:
- Penalties – this is usually a result of late payments and filing inaccurate tax forms/returns.
- Unpaid taxes – when you owe money but cannot fulfil payments due to various reasons.
- Non-filers – incomplete tax forms that have not been returned which are required or filled out.
- Tax avoidance- this is when businesses or individuals ignore their social obligation altogether. This is usually associated with greed and selfishness, and can damage the reputation of the company. It is considered very unethical and will most likely bring about the attention of tax fraud investigators.
How to create a payment plan
- Full Payment: paying the amount on the tax notice and avoiding the confrontation with the taxing authority. Most of the time, this option is not the best option for the taxpayer to resolve their tax problem, as often the tax bill is inaccurate.
- Pay The Correct Tax Only: paying the actual amount of taxes if you can afford it is usually a good solution to your tax problem. This will entail working with the taxing authority to subside the penalty assessed. The success of penalty withdrawal is based on reasonable cause and not willful neglect.
- Installment Agreement: paying the tax amount through an installment agreement is a common way to resolve your tax problem. You should seek professional tax advice, as the taxing authority will usually request a large monthly payment, while professional tax representatives will work on attaining an installment agreement that is reasonable and you can live with without causing a financial and economic hardship on you and your family.
No matter which option is correct to resolve your tax problems, usually there are more than one viable option, it is essential that the taxpayer comply with the tax law going forward. That is, all tax returns are filed timely and all estimated income taxes and payroll deposits must be paid when due.
How we can help
Let us handle all your taxes so that you do not have to worry about the aforementioned issues arising. Here at Carrington Blake Accountancy, we pride ourselves in having an expert team of accountants who are genuinely passionate about what they do. This passion compels us to provide you with impeccable service, with a strong focus on presenting each client with stress-free and transparent account and tax return handling. Contact us today to learn more about the vast services we offer and if you have any questions.