It’s a good thing to be punctual, especially when it comes to finances. Some major payment delays can lower your credit score and make it more difficult to get money loans.
But what about unpaid taxes? Can they also impact your credit rating from major credit bureaus in Canada? That deserves to be deepened.
What elements can affect your credit rating?
Above all, it is important to know different factors that can influence a credit score.
Payment and credit history
The way you paid your credit debt and the time you took to do it are the elements that have the most impact on your credit rating. This means that all bill payments you have made in the last six years are recorded whether these payments have been made on time and in full, in part, late or simply missed.
Obviously, someone who misses his commitments will see his score drop. This is why it can sometimes be relevant to use a loan without a credit check to make certain payments. You can free yourself from accumulated debts that could lower your rating.
Using your credit
The ratio obtained by comparing the debts you carry compared to the amount of available credit you have is another factor that influences your credit rating. The more you use your different credit cards up to the limit, the more likely you are to see your credit score go down.
Does CRA send information to major credit bureaus?
However, if you owe an amount that justifies a lawsuit and a collection agency is involved, the CRA could actually put a tax lien on your credit report. In short, if your tax file is bad enough for the situation to become public, Canada’s credit bureaus will be made aware of your unstable financial situation and your credit rating will be permanently damaged.
How to prevent your credit score from being damaged by unpaid taxes?
As a low credit rating can not only affect your financial health, but also your personal life, it’s best to make sure your unpaid taxes do not make it less.
If you can prove that you do not have enough funds to pay your entire tax, you can negotiate a multi-year plan with the CRA, which you will have to meet until your debt is fully repaid. The longer you wait, the more money you will have and the more the consequences may be bad. In short, the Canadian government will temporarily ensure that you are not in a precarious financial situation and that you have enough money to buy groceries, live and pay for your medical expenses.
Protect your credit rating
In short, unpaid taxes, when they become too large, they can have a very negative impact on your credit score. That’s why if you are worried about reaching this fateful threshold, you can call on Good Financ Loans. You will have quick access to an amount of money allowing you to free your tax debts and thus protect your credit rating.