Small Business Tax Obligations In Canada

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By L.Kenway BComm CPB Retired

Published February 4, 2024  |  Updated March 15, 2024  |  Edited April 5, 2024


Quick Links
Self Employed | Employees | Corporation | Tax Audits |Little Known Deadlines

Small Daily Habits Can Move Mountains

Self- Employed Tax Deductions


Tax Primer for Sole Proprietors



Employee Taxable & Non-Taxable Benefits




Quick Links - Little Known Deadlines



Tax Audits


Auditor arriving for a tax auditUnderstanding the Audit Process
Auditor examining cash transactionsHow To Record Cash Under The Table Transactions



Incorporated Tax Compliance






Small Business Tax Obligations


Payroll

  • Quarterly PD7A - 15th following end of calendar quarter
  • T4 slips - Last day of February

GST HST

  • Annual Returns - June 15
  • Quarterly Returns - end of month following end of fiscal quarter

Income Tax

  • T1 Sole Proprietor - June 15 to file; balance due April 30
  • Installments - quarterly on 15th
  • T2 active - 6 months after yearend; balance due 3 months after yearend
  • T2 passive or PSB - 6 months after yearend; balance due 2 months after yearend

Independent Contractors

  • T4A - Last day of February
  • T5018 - Six Months After The End Of The Reporting Period You Have Chosen

Puzzle Pieces
Puzzle Pieces

Good Compliance Habit

Compliance Obligations YOU Should Know


Tax Event / Moving Timeline

Correcting a Return for Errors or Omissions

  • 10 years after the end of the adjusted taxation year

Tax Court Appeals

  • No later than 90 days from mailing date of Notice of Reassessment or confirmation of assessment 
  • No earlier than 90 days following mailing date of Notice of Objection (if CRA has not responded)

Collections - Tax Owing

  • 10 years from date of assessment
  • Debt collection is suspended when a Notice of Objection or an appeal has been made

Objection to a Notice of Assessment or Reassessment

  • In general, 90 days from mailing date of notice ... individuals 1 year from due date of return

GST/HST Refunds

  • 4 years from the end of reporting period due date if you have filed all returns for all your business accounts
  • A refund will be used automatically to offset other debts owing instead of being paid out

CRA Income Tax Refunds

  • In general, 3 years from end of relevant tax year ... EI 3 years; CPP 4 years; individuals 10 years for Federal, Ontario and Quebec
  • If due to loss carryback, extended to 6 years ... 7 years if the corporation is not a CCPC
  • A refund will be used automatically to offset other debts owing instead of being paid out

Make sure you discuss your small business tax situation with a professional who can give you advice tailored to your specific circumstances.

Source: CRA Website


Puzzle Pieces

Small Business Tax Obligations - Personal Tax Reminders

If any of the following deadline date falls on a weekend or holiday, it moves to the first business day following.

Current Tax Season Deadlines

Tax Type Filing AND Payment Deadline Form to be Filed Tax Period
Interest payment on inter-spousal loans 30 days after calendar yearend Jan. 30 Bank transaction NOT journal entry Prior Year
T4, T4A, T5 Slips last day of February T4,T4A,T5 and TSums Prior Year
T5008 Stmt of Securities Transactions last day of February T5008 Prior Year
RRSP Contribution last day of February Issued by bank/broker Prior Year
T3 and T5013 slips before end of March T3, T3Sum, T5013 Prior Year
Individual Benefit and Tax Return Apr. 30 T1 Prior Year
Foreign Income Verification Apr. 30 T1135 Prior Year
Self-Employed Tax Return (incl spouse) FILE by Jun. 15
PAY by Apr. 30
T1 (Schedule T2125) Prior Year
Tax-Free Savings Account (TFSA) Return Jun. 30 RC243 Prior Year
Schedule A - Excess TFSA Amounts Jun. 30 RC243-SCH-A Prior Year
Non-Resident Contributions to a Tax Free Savings Account Jun. 30 RC243-SCH-B Prior Year
Corporate Tax Return Click here
for details
T2 Prior Fiscal Year
Construction Payment Reporting System (CPRS) Prior Year T5018 & T50818 Sum 6 months after
end of reporting period

More>> Click here for some small business tax compliance notes on installments, payment deadlines, and annual indexation adjustments for personal income tax and benefit amounts.


U.S. Tax Deadlines That Affect Canadians

Tax Type Filing AND Payment Deadline Form to be Filed Tax Period
US Tax Return Apr. 15 Form 1040 or Form 1040NR optional Form 4868 Prior Year
US assets - FATCA Apr. 15 Form 9838 Prior Year
Close Connection Jun. 15 Form 8840 Prior Year
US citizens - FBAR* Apr. 15 but is on automatic extension to Oct. 15 Form FinCEN Form 114 (formerly TD F 90-22.1 Prior Year

*Beginning in 2017 (for the 2016 tax year), US citizens residing outside of the US, had new FBAR deadlines. 1040 filing deadline is April 15. You are given an automatic extension time to file by June 15 (not available to US citizens living in the US) and an extended deadline of October 15 if Form 4868 is filed. See Bakertilly (formerly Collins Barrow) for more information. 


Benefits and Interest Date Reminders

Tax Type Deadline Form to be Filed Tax Period
Self-Assessment RRSP Excess Contributions Interest Penalty Mar. 30 (90 days after year ends) T1-OVP Prior Year
Advanced Life Deferred Annuity (ALDA) started Jan. 2020 Apr. 30 OVA_ALDA Prior Year
Canada Carbon Rebate (CCR) Started Apr. 2024 Prior year T1 Prior Year
Overdue Taxes Interest Begins Accruing Daily May 1 -- Prior Year
Refund Interest on Late Processed Refunds due from CRA Jun. 15 -- Prior Year
New Benefit Year Begins (CTB, GST Credit, OAS, CPP, GIS) Jul. 1 Prior Year T1 Prior Year
Automatic Advance Payments CWB* Started Jul. 2023 RC210 Prior Year

*CWB (Canada Workers Benefit) advance payments was replaced in July 2023 with automatic advance payments based on the prior year's tax return. It is also referred to ACWB (Advanced Canada Workers Benefit). It was formerly called WITB (Working Income Tax Benefit) which applied to tax years prior to 2019.

Benefits payment schedule:

  • CCB payments are made by direct deposit or cheque around the 20th of each month.
  • OAS & GIS benefit payments are made monthly typically the last week of each month. Both are tied to CPI (consumer price index) meaning the amount is reviewed each quarter. Payments increase if inflation is up. If there is no change in CPI or it drops, then there is no indexing.
  • CPP benefit payments are made monthly typically around the third to last business day of the month. They are tied to the CPI index. Unlike OAS & GIS, the rate increases are calculated one a year and applied in January. Payments increase if inflation is up. If there is no change in CPI or it drops, then there is no indexing.
  • GST credits are made quarterly on the 5th of July, October, January and April.
  • CCR (Climate carbon rebate) payments are made quarterly on the 15th of April, July, October and January if you file you T1 on or before March 15th.
  • Automatic, advance CWB refundable tax credit payments are made on July 28th, and the 12th of October and January based on the prior year and automatically provide advance payments equal to 50% of the CWB credit. To receive CWB you need to file your T1. Advances that exceed the the entitlement for the current year will not have to be repaid.


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