We solve serious CRA tax problems

Behind on Taxes? Here’s How to Fix It Before the CRA Comes Knocking

Falling behind on your taxes in Canada can feel like a dirty secret. One year turns into two. You move, change jobs, get overwhelmed, or scared, or maybe the money simply wasn’t there. And suddenly, you’re Googling things like what happens if I haven’t filed in 5 years while dodging CRA letters you’re too nervous to open.

Here’s the truth: thousands of Canadians are in the same position. What matters now is not how it started, but how you fix it. And you can fix it. Quietly, legally, and without a criminal record. You just need to move before the CRA moves first.

Let’s walk through what happens if you don’t act, what your options really are, and how Faris CPA helps clients take control, without the judgment, fear tactics, or fluff.

What Happens If You Haven’t Filed Taxes in Years?

Not filing taxes isn’t just an oversight. After a certain point, it becomes a red flag for the Canada Revenue Agency (CRA). Here’s what you’re risking:

  • Penalties and interest. The CRA charges late-filing penalties (5% of your balance owing, plus 1% for each full month your return is late, up to 12 months). Then interest on top of that. 
  • Audits and reassessments. If the CRA believes you’re hiding income, they’ll reassess past years, even without your input. 
  • Legal action. In extreme cases, not filing taxes can lead to criminal prosecution. Yes, criminal. Jail time is rare, but having your assets seized and your paycheques and/or bank accounts garnished is not. 

And once the CRA starts an investigation, your chance to come forward voluntarily and avoid those worst-case outcomes? It disappears.

Common Reasons Canadians Fall Behind on Their Taxes

Before we go further, let’s drop the shame. There are plenty of reasons people fall behind on taxes. Here are some of the most common:

  • Self-employment or gig work. Without an employer withholding taxes, it’s easy to underestimate what you owe. 
  • Illness or family crisis. Life doesn’t pause for tax season. 
  • Fear of owing. Some people avoid filing because they know they’ll owe, but that avoidance makes the penalties even worse. 
  • Complex finances. If you’ve sold a property, traded crypto, or run a small business, filing gets complicated fast. 
  • Cash jobs or undeclared income. If you’re unsure how to report what you made, or if the CRA will come after you for it, you might freeze. 

Even sex workers and creators on platforms like OnlyFans are often left guessing about how to handle taxes. If that’s you, here’s how sex workers pay taxes in Canada and why it’s smarter to get ahead of it now.

The CRA’s Power: Audits, Penalties, and Prosecution

If you’ve heard that the CRA is “aggressive,” it’s because they are. They don’t just rely on what you tell them. They cross-check data with banks, employers, and payment platforms like PayPal. And yes, they can request third-party records without your permission.

They can even look at your online transactions. If you’re selling through Etsy, Facebook Marketplace, or PayPal, the CRA is watching. Here’s their stance on PayPal income.

If you’ve received a Notice of Reassessment, audit letter, or demand to file, things are already in motion unless you do something about it. After some time has passed without payment or an arrangement to pay has been made, the CRA can:

  • Freeze your bank accounts 
  • Garnish wages 
  • Place a lien on your property (Learn more about tax liens in Canada) 

The Voluntary Disclosures Program (VDP) Lifeline

The Voluntary Disclosures Program is a legal way to come clean with reduced penalties and, most importantly, protection from prosecution.

But there’s a catch: you have to apply before the CRA contacts you.

The VDP is open to individuals and businesses who:

  • Failed to file a return
  • Made mistakes on previously filed return(s)
  • Failed to report income
  • Claimed ineligible expenses
  • Did anything that could result in a penalty or prosecution 

If you qualify, the CRA may waive penalties and reduce interest. You’ll still need to pay what you owe, but you can do it on your terms, with a clean slate.

How Faris CPA Helped Clients Fix Tax Return Problems

At Faris CPA, we’ve helped Canadians from every province and territory get out of the hole. We’ve:

  • Helped a contractor file eight years of unfiled taxes and avoid over $60,000 in penalties through the VDP 
  • Defended a business owner during a full CRA audit and settled with no criminal charges 
  • Supported a self-employed client through backfiling and negotiating a payment plan that actually worked for their budget 

And we’ve done it without judgment, shaming, or fear tactics. Just straight answers and smart, confidential support.

Why You Need to Act Before the CRA Ramps Up Enforcement

The CRA continually invests in new enforcement tools, including AI-driven audits, financial data mining, and enhanced information sharing among agencies. That means the window for coming forward voluntarily is shrinking.

And when they find you first, VDP is no longer an option.

Waiting feels easier, but it makes everything harder. You don’t need to wait for a knock at your door or a freeze on your accounts.

What Happens After You Reach Out to Faris CPA?

Here’s what the process looks like when you contact us:

  1. Confidential consultation. You tell us what’s going on. We don’t judge. We listen, assess, and explain your rights. 
  2. Document review. We gather your financial records, slips, and supporting documents, even if you don’t have everything. 
  3. Strategy. We decide whether you qualify for the VDP, or if another option (like a Notice of Objection or audit defence) is better. 
  4. Submission & negotiation. We handle the paperwork, submissions, and negotiations with the CRA, so you don’t have to speak to them directly. 
  5. Resolution. You get back on track, clean up your history, and move forward without fear. 

This is what CRA tax audit services should look like: professional, discreet, and effective.

How a CPA Differs from a Tax Lawyer (And Why It Matters)

You don’t need a courtroom. You need someone who can deal with the CRA efficiently and cost-effectively. That’s where a licensed CPA like Sam Faris comes in.

Unlike lawyers who focus on litigation, we focus on resolution: filing, fixing, negotiating, and defending. We understand CRA language, processes, and pressure points.

Here’s more about Faris CPA, including our national scope, CPA leadership, and success rate.

What If You Have Undeclared Income?

If you’ve worked in cash, traded crypto, or sold goods or services online, undeclared income can become a massive liability. The CRA doesn’t just penalize unreported earnings; they assess based on what they think you made, often with harsh assumptions.

The VDP is the best route if you want to disclose undeclared income safely. But if the CRA already contacted you, we’ll work to build your defence and minimize penalties.

Need help understanding how property sales factor in? Here’s our explainer on proceeds of disposition and how they apply to capital gains.

Tips for Coming Forward Without Making It Worse

Timing and accuracy matter. Here’s what to avoid:

  • Don’t call the CRA before speaking to a professional. You might say something that hurts your case. 
  • Don’t guess your income or deductions. Round numbers look suspicious. 
  • Don’t delay if you’ve received CRA mail. If there’s a reassessment or demand letter, time is already running out. 

Instead, get professional help. You don’t have to figure this out alone.

What If You Can’t Pay What You Owe?

Aside from unfiled tax returns, tax debt can also be a heavy burden. The good news? You don’t need to pay it all upfront to start fixing things. Here are a few realistic options:

  • Payment arrangements. If you owe but can’t afford a lump sum, the CRA may allow monthly payments. But don’t negotiate this alone; they might not offer their best terms unless pushed. 
  • Taxpayer relief. In some cases, we can apply to reduce interest and penalties due to hardship, illness, or financial disruption. 
  • Reassessment adjustments. If the CRA overestimated your income, we may challenge it and lower your balance. 

The worst move is silence. Let us deal with the CRA, not your voicemail.

The CRA’s Tactics: What to Watch For

The CRA starts with polite letters. But if they suspect you’re hiding something, they can escalate quickly.

Here are a few other tools at their disposal:

  • Requirement to file notices. These are formal demands, not suggestions. Ignore them, and the CRA will assess your return without your input. 
  • Arbitrary assessments. If you don’t respond, the CRA can guess what you owe,usually on the high side. 
  • Legal collection. The CRA has the authority to garnish your wages, seize bank funds, or register liens on your property without going to court. 

At Faris CPA, we know how the CRA works because we’ve defended clients against them for years. We respond decisively on your behalf.

Why VDP Applications Fail (And How We Make Them Work)

Not all Voluntary Disclosures Program (VDP) applications are accepted. Submitting one doesn’t mean automatic protection.

Common reasons for rejection:

  • You were already under audit or review when you applied 
  • Your disclosure wasn’t complete or accurate 
  • The application looked like an attempt to game the system 

We don’t let that happen. At Faris CPA, we ensure:

  • Full and accurate disclosure that qualifies under the VDP 
  • Strategic timing before CRA inquiries begin 
  • Proper documentation, so your application doesn’t raise red flags 

This isn’t DIY territory. It’s a legally binding tax resolution, and it’s what we do.

If You’ve Already Been Contacted by the CRA

Let’s say the CRA already reached out. Does that mean it’s too late? Not necessarily.

While VDP may no longer be an option, there are other tools we can use:

  • Notice of Objection. If you disagree with a reassessment, we can file a formal objection and pause collection action while it’s reviewed (except for GST/HST (re)assessments). 
  • Taxpayer relief request. For penalties and interest related to extraordinary circumstances. 
  • Audit defence. If you’re being audited on unreported income/unfiled returns, we communicate with the CRA on your behalf, supply evidence, and challenge unreasonable claims. 

This is where a licensed CPA with CRA experience makes all the difference. If you’re already on their radar, don’t face it alone.

Why National Reach Matters (Even If You’re in a Small Town)

Whether you’re in Toronto, Vancouver, Yellowknife, or a rural part of Alberta, Faris CPA works with clients across Canada. That matters because:

  • CRA enforcement is national; your location won’t protect you 
  • Our solutions are compliant with federal tax law, not just provincial requirements 
  • We’ve seen every variation of tax problem you can imagine 

When you’re dealing with the CRA, the quality of your representation matters more than where they’re based. We bring national experience to your individual case.

Don’t Rely on “No News Is Good News”

Silence from the CRA doesn’t mean they forgot about you. In fact, they may already be watching. Their systems track:

  • Missed T-slips or earnings reports 
  • Property sales without capital gains declarations 
  • GST/HST inconsistencies 
  • Unreported income through digital platforms or foreign accounts 

Just because they haven’t sent you a letter yet doesn’t mean you’re off their radar. If anything, you’re giving them more time to build a case against you, without your input.

We’ve worked with clients who thought they were in the clear until a surprise audit arrived, years later. The earlier you act, the more control you have over the outcome.

What Happens During a CRA Reassessment

If you’ve already filed but the CRA doesn’t like what they see, they may send you a Notice of Reassessment. This is not just a suggestion; it’s a formal recalculation of what they think you owe.

And if you don’t respond?

  • They can start collections 
  • Add interest daily 
  • Limit your options for appealing 

Here’s where we come in: Faris CPA will review the reassessment line by line, challenge any unfair assumptions, and file objections where appropriate. If you’ve received a reassessment or know one is coming, let’s talk before the time runs out on your recourse options.

Explore how we offer CRA reassessment support across Canada.

Illustration of a woman reviewing tax forms beside a calculator with the message “Take the stress out of tax debt” promoting Faris CPA’s services for getting back on track financially.

What If You’re Behind on GST/HST?

Filing personal taxes is one thing. Falling behind on GST/HST is a whole other level of CRA scrutiny. If you’re self-employed or own a business, unfiled GST/HST returns can trigger:

  • Immediate CRA collections 
  • Business account freezes 
  • Legal action for trust funds withheld 

Unlike personal tax debts, GST/HST amounts are treated as money you collected on the government’s behalf. That makes the consequences more severe.

If your business is behind, it’s not too late. We help clients bring GST/HST filings up to date and negotiate repayment options quickly and discreetly.

The Hidden Risk of “Partial Disclosure”

Some people try to test the waters with the CRA by sending in one late return. They hope it won’t trigger a deeper review. It usually does.

The CRA is trained to look for patterns. If you file one return and they suspect you’re missing others, they’ll dig deeper. This strategy backfires.

At Faris CPA, we guide you through full, strategic disclosure, the kind that builds trust with the CRA and qualifies you for actual relief. No guesswork. No accidental red flags.

Half-steps lead to full consequences. If you’re going to come clean, do it right the first time.

The Emotional Cost of Tax Anxiety

Let’s talk about the part no one puts in writing: the stress. The fear of that knock on the door. The unopened mail piling up. The constant background hum of “what if.”

We’ve spoken to clients who haven’t travelled in years, afraid a tax issue might flag them at the border. Others couldn’t sleep, worried about wage garnishment or frozen accounts.

The emotional toll is real, and so is the relief when it’s finally over.

Solving tax problems isn’t just about numbers. It’s about peace of mind. You don’t need to carry this by yourself anymore.

Let’s Recap: Your Options, Your Rights, Your Move

If you’ve read this far, you’re likely carrying a lot of stress about unfiled taxes. So here’s what to take away:

  • You can fix this, even if it’s been years. 
  • The CRA is watching, and their tools are getting sharper. 
  • The Voluntary Disclosures Program is a limited-time opportunity. Once the CRA contacts you, it’s gone. 
  • Faris CPA helps Canadians clean up back taxes, navigate CRA audits, and regain peace of mind. 

You don’t have to panic. But you do have to act.

Final Call: Stop Living in Fear of the CRA

Let’s be clear. Ignoring tax problems never makes them go away. But solving them? That’s easier than you think when you have the right team behind you.

Whether it’s unfiled returns, undeclared income, or a CRA reassessment, Faris CPA will help you take control. No lectures. No scare tactics. Just expert solutions, handled discreetly and efficiently.

Don’t wait for the CRA to find you first.

About the Author

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Pro Tip

ACCESSING THE SMALL BUSINESS DEDUCTION IN YOUR BUSINESS

The Small Business Deduction gives businesses a tax deduction on the first $500,000 of income. This saves an eligible corporation around up to $50,000 in income taxes. There are a number of conditions that have to be met to be eligible for this deduction.

I was referred to Sam Faris by a tax lawyer to handle my a complicated tax audit by the CRA and to refile all my outstanding corporate and personal tax returns. He was highly recommended by the tax lawyer and by other professional. The minute I hired Sam to sort out the big mess that I had with the CRA, I felt I am safe and in a good hands. He and his team were responsive to my questions and my concerns. Once he completed his work, he insisted to meet in person with the auditor and the team leader. His work quality was second to none. He backed up all accounts prepared a perfect reconciliation. On that basis, he presented his work confidentially and was able to convince the CRA team with his position and his calculations. I must admit that Sam Faris is the best tax consultant and he is a life saver. As a side note, his fee is very reasonable considering to other professionals and more importantly the work quality and the results that he achieved are unbeatable.
Response from the owner:Many thanks Moss for the positive review.
I was referred to Mr. Faris by another professional who recommended him to deal with my multiple years of outstanding corporate and tax returns. I interviewed Sam and was impressed in his confidence and transparency. He did not promise the moon just to get my business. Sam was able to file all returns under the voluntary disclosure program. After completing filling all tax returns, I realized the amount of money he saved me. I enjoyed very much working with him. He ensured that the work progress flow smoothly without any complications. He took to consideration the emotional stress factor and he was available to speak with me even beyond business hours just to make me more calm and to make me feel that he is on top of the matter and it will be resolved to my satisfaction. Indeed, this is what happened. The matter was resolved to my satisfaction and CRA concluded that the returns which Sam filed are reasonable and there is no need to further audit me nor my company. In summary, Sam is a life saver. He saved me and saved my family and now I am in the right track where all my tax filing obligations are met and I don’t owe any taxes. So grateful to Sam and his dedication while working on my file.
Response from the owner:Raj Thank you for the positive Google review. We are happy that you are satisfied with our services. Voluntary disclosure program is one of our specialties and we have dealt with many complex cases too. We get referrals from other professionals as we have been in the business of fighting CRA many years and we have countless success stories that many professionals are aware of. Please do contact us if you require further help in the future.
Sam is an excellent CPA and the best tax consultant in the country. He helped me to deal with a very complicated tax audit with the CRA where the CRA sent me a proposal assessment of 1.5 million dollars based on their net worth audit calculation and analysis. Sam was able to provide a counter analysis which highlighted significant mistakes that the auditor made with his assumptions and calculations. It’s ridicules that CRA wanted to taxed me on a loan that I obtained from my bank. Sam dealt with this audit perfectly. He demonstrated a very high level of expertise and CRA had to accept his counter analysis with no question asked. Many thanks to Sam’s efforts and high business standards in dealing with this issue and resolve it to my favor. I will have Sam as my primary CPA going forward so I can focus on doing business and will have a peace of mind in terms of the high quality of work done by him. Well deserved this review with the 5 stars rating.
Response from the owner:Yash Thank you for the positive feedback and the 5 stars Google review. We are glad that you are happy with our service and you are satisfied with the outcome. Net worth audits are very complicated and disputing them might get very tricky. We have been dealing with the same types of audits for many years and we are confident in fighting CRA and to point out mistakes that the auditor have made while performing the audit. We will remain at your disposal anytime you contact us in the future.
Sam Faris helped me with a complex cross border tax matter. This issue involved 12 years of tax returns and it was as a result from mistakes that my previous accountant did. He was able to perfectly address the issue with the CRA and to fix the returns under the voluntary disclosure program. End results; CRA accepted Sam’s work with not a single question and the returns were reassessed to my satisfaction without penalties and interest. Many thanks to Sam brilliant work.
Response from the owner:Dear Sir It was a pleasure working on your file and get you the results that you aimed to have and to your satisfaction. We have been dealing with similar cases for many years and we were confident that the results are favorable. Please feel free to contact us in the future if you do require further help.
I found Sam’s firm online and I read the excellent Google reviews about him and his team. I decided to hire him to help me navigate an issue with the CRA. Sam delivered as expected and as promised. Results were to my satisfaction and I am very happy with how the process was handled. Highly professional and extremely knowledgeable.
Response from the owner:Dear Tanya Thank you for the 5 stars Google review and your kind words. We strive to provide the best customer service and make our clients relax and calm during the process. The cases we are taking are very sensitive so providing quality work to the CRA is extremely important so just to avoid any escalation and to make sure that our package is accepted from the first round. We will remain at your disposal anytime you require our services. Sam Faris
after the initial assessment I had with Sam, he proposed a strategy to dispute CRA decision. He knew up front how to approach my case as he seemed that he dealt with similar cases many times. I hired him the end results were as promised and no surprises. Sam is very trust worthy and has a high business standards. May thanks Sam.
Response from the owner:Many thanks for the positive review.
I recently turned to Faris CPA for help with my tax filing, and I must say, I'm over the moon with the results! The whole process was a breeze, saving me time and stress. What really stood out was the friendly professionalism, impressive expertise, and crystal-clear communication from Sam and his team. They made what could've been a daunting task feel like a walk in the park! If you're looking for a warm, approachable tax expert who genuinely cares about his clients, I wholeheartedly recommend Sam and the folks at Faris CPA - they're great tax consultants!
Response from the owner:Many thanks.
Working with Sam and his team was an extremely valuable experience. One of the best Tax consultants in Toronto I've ever come across.

He has a ton of experience resolving problems with the CRA and was truly a big asset to me when I had issues I needed help with.

Would highly recommend Sam and Faris CPA, thanks again for all the great work!
Response from the owner:Thank you Paul for your positive feedback and we are glad we met your expectations.
I had an amazing experience working with Faris CPA for my CRA needs. They really know the CRA processes and made everything so easy. They were super professional, always ready to answer my questions, and made sure everything was done right. I couldn't have asked for better help. Highly recommend their services for anyone dealing with the CRA! -Sara
Response from the owner:Thank you Sara for the 5 stars review.