The corporate tax deadline in Canada is quickly approaching! If you’re a business owner, it’s important to be prepared and know what you need to do to file your taxes on time.
In this blog post, we’ll give you a rundown of the corporate tax deadline in Canada and what you need to do to comply with it. We’ll also offer some tips on how to make the filing process as smooth and stress-free as possible. Let’s start!
Deadlines for Corporate Taxes
Corporate tax deadlines are different from personal tax deadlines. Corporations may have year-ends other than December 31 for tax reasons. We can, however, readily determine when your corporation’s tax filings and amounts owed are due.
Corporate Income Tax Return
Corporate tax returns must be filed six months after the fiscal tax year-end. Let us explain a few scenarios:
When a corporation’s fiscal year-end is on the last day of a month, the corporate tax return is due on the last day of the sixth month after the year-end. For example, a year ending on December 31, 2021, would have a due date of June 30, 2022.
When the ending day of the tax year does not coincide with the last day of a month, the return is due on the same day of the sixth month after the year’s end. A year ending on September 15, 2021, for example, would have a year ending on March 15, 2022.
Corporate Taxes Owing
The due dates for unpaid amounts are sooner than the deadline dates for submitting tax returns. The short explanation is that unpaid taxes are to be paid two months after the fiscal year-end is complete.
However, there is a fairly frequent exception.
Corporate taxes are due three months after the fiscal year-end if you meet the following conditions:
- In the preceding year, the company and all affiliated corporations (if any) had a taxable income of less than $500,000 each.
- Either this year or last, the company took advantage of the small business deduction.
- The company is a private corporation controlled by Canadians.
Because the above-mentioned exemption is fairly typical, your business taxes are almost certainly payable three months after the end of the fiscal year. We recommend that you ask your accountant or send us a note to make sure you have the right date.
How can you file your corporate taxes?
You can file your corporate taxes online, through a paper return, or through a third-party tax preparer.
What information do you require to file your corporate taxes?
When filing your corporate taxes, you will need to provide your business number, as well as your corporation’s address and contact information. You will also need to include financial information such as your income, expenses, and assets.
What are the consequences of not filing my corporate taxes?
If you do not file your corporate taxes by the deadline, you may be subject to late filing fees and interest charges. In addition, your corporation may be audited by the Canadian Revenue Agency (CRA).
What is the current interest rate for overdue payments?
As of January 1, 2020, the interest rate for overdue payments is 5% per year. This interest rate is applied to any unpaid amounts owing on your Corporation Income Tax return, balance owing for installments, and amounts owing for fines or penalties.
The interest rate is also applied to any unpaid amount of tax that is owed by a partnership or trust to a corporation.
How to minimize delays in processing the tax return?
To minimize delays in processing, ensure your return is complete and accurate, and submit it as early as possible. If you are submitting a paper return, send it by mail or courier to your tax center. If you are filing electronically, use the CRA’s File Your Return service.
If you are paying by cheque, make it payable to the Receiver General for Canada and include your business number on the front. For electronic payments, log into your My Business Account and go to Make a Payment.
If you are a Canadian corporation, it is important to be aware of the tax deadline so that you can avoid paying interest and penalties on your taxes. To ensure that you are able to meet the deadline, it is advisable to file your tax return as soon as you can.
We hope that this article has helped to provide some clarity on the corporate tax deadline in Canada for 2022.