- Essential Bookkeeping Habits For Audit Ready Books in Canada
- Small Business Tax Obligations
Small Business Tax Obligations In Canada
Image and Link Index For Getting All Your Ducks In A Row
By L.Kenway BComm CPB Retired
Published February 4, 2024 | Updated March 15, 2024 | Edited June 15, 2024
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How Do You Start Your Day | Self Employed | Employees | Corporation | Tax Audits | Little Known Deadlines
Small Daily Habits Can Move Mountains
Do just one task today towards meeting your tax compliance obligations. Just one.
How Do You Start Your Day?
Nvidia's CEO Jensen Huang said in a commencement speech at the California Institute of Technology, "I [spend] every single morning exactly the same way. I begin each morning by doing my highest priority work first. Before I even get to work, my day is already a success. I've already completed my most important work and can dedicate my day to helping others. When people apologize for interrupting me, I always say, 'I have plenty of time.' And I do."
He concluded his speech with, "I hope you do find a craft that you want to dedicate your lifetime to perfecting, to home in the skills of your life's work." He added: "Prioritize your life. There's so many things going on, there's so many things to do, but prioritize your life. You will have time."
Source: CNBC Ashton Jackson, Jun 15, 2024, Nvidia CEO: One of the most 'profound learnings in my life' came from a gardener—how it made me successful
Perhaps, just perhaps, for this year, you can prioritize getting all your ducks in a row with regards your small business tax obligations. Set aside time (maybe 30 minutes) at the start of each day instead of at night when you are tired to work on your compliance obligations.
Stuck in a line up? Maybe read just one of these articles to learn the rules. Why?
To help reduce the likelihood of a government audit or to increase the odds of an audit going smoothly, you need to know the rules. There are penalties if you break the rules. Following are articles on areas CRA regularly looks at during a desk or field audit.
Self- Employed Tax Deductions
Learning The Rules
What is Capital Cost Allowance (CCA)?Employee Taxable & Non-Taxable Benefits
Learning The Rules
Employee Taxable Benefits
Incorporated Tax Compliance
Learning The Rules
Owner-Manager Compensation ... Coming Soon
Small Business Tax Obligations
- Quarterly PD7A - 15th following end of calendar quarter
- T4 slips - Last day of February
- Annual Returns - June 15
- Quarterly Returns - end of month following end of fiscal quarter
- 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
- T4A - Last day of February
- T5018 - Six Months After The End Of The Reporting Period You Have Chosen
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
Small Business Tax Obligations - Personal Tax Reminders
If any of the following deadline dates 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 |
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 once 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 your 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 entitlement for the current year will not have to be repaid.
Related Pages On Small Business Tax Compliance
Payroll Tax Filing Deadlines | Canadian Bookkeeping
The CRA requires regular reporting and remitting of source deductions withheld from employee pay cheques. Find your payroll tax filing deadlines here.
Tax Compliance for Small Business | Canadian Filing Deadlines
Tax compliance filing deadlines for small business owners - GST HST returns, payroll remittances, income tax returns and instalment payments, subcontractors
GST HST Filing Deadline | Canadian Bookkeeping
Canada Revenue Agency requires regular reporting of Canadian sales tax collected and input tax credits. Here are your GST HST Filing Deadlines.
Small Business Bookkeeping | Basic Bookkeeping
Small business bookkeeping is an age old system designed to keep financial records in an organized way. Technology has made it easier than ever to learn.
