Chapter 4 - Administration

Question 1

When is an individual required to file a tax return? (ITA 150(1.1), 150(1))

Answer 1

If any of the following apply:

• Tax is payable.
• Taxable capital gain or disposed of capital property.
• Minister issues a demand to file.
• Positive Home Buyers’ Plan or Lifelong Learning Plan balance at year end.
• Non-resident with taxable capital gain.

Question 2

What is the prescribed form for individuals?

Answer 2

T1.

Question 3

What are the filing deadlines for individuals? (ITA 150(1))

Answer 3

April 30 (general).

June 15 if taxpayer or spouse carried on business.

Later of 6 months after death and the normal deadline if taxpayer died during the year.

Question 4

What is the balance due date for individuals? (ITA 248(1))

Answer 4

April 30.

Question 5

When must a corporation file a return? (ITA 150(1))

Answer 5

If:

• Tax is payable (or would be without treaty).
• At any time in year, it:
  
  • is resident in Canada,
  • carries on business in Canada,
  • realized taxable capital gain, or
  • disposed of taxable Canadian property.

Question 6

What is the prescribed form for corporations?

Answer 6

T2.

Question 7

When is the filing deadline for corporations?

Answer 7

Six months after fiscal year end.

Question 8

What is the balance due date for corporations? (ITA 248(1))

Answer 8

2 months after year end (general).

3 months after year end for CCPCs if:
- claimed small business deduction in current/preceding year, and
- taxable income ≤ $500,000 in preceding year for corp/associated group.

Question 9

When must individuals pay tax instalments? (ITA 156(1))

Answer 9

If net tax owing exceeds $3,000 for:

• current year (estimated), and
• at least one of two preceding years.

Question 10

What are individual instalment due dates?

Answer 10

March 15, June 15, September 15, December 15.

Question 11

How are individual instalments calculated?

Answer 11

Least of:

• ¼ × estimated current year net tax.
• ¼ × net tax owing for preceding year.
• First 2 instalments: ¼ × net tax from second preceding year; last 2 instalments: ½ × preceding year’s net tax – first 2 instalments.

Question 12

When must corporations pay tax instalments? (ITA 157(1))

Answer 12

If net tax owing > $3,000 for current year (estimated) and preceding year.

Question 13

How often do corporations pay instalments?

Answer 13

Monthly (most corporations).

Quarterly (eligible small CCPCs).

Question 14

How are monthly instalments calculated (non-CCPCs)?

Answer 14

Least of:

• 1/12 × estimated current year tax.
• 1/12 × preceding year’s tax.
• First 2 instalments: 1/12 × second preceding year’s tax; last 10 instalments: 1/10 × preceding year’s tax – first 2 instalments.

Question 15

When can a CCPC pay quarterly instalments?

Answer 15

If it:

• taxable income ≤ $500,000 (current or previous year),
• taxable capital in Canada ≤ $10M,
• claimed small business deduction in current/preceding year, and
• has perfect compliance history.

Question 16

How are quarterly CCPC instalments calculated?

Answer 16

Least of:

• ¼ × estimated current year tax.
• ¼ × preceding year tax.
• First instalment: ¼ × second preceding year’s tax; last 3 instalments: ⅓ × (preceding year’s tax – first instalment).