Tax Tip Thursday

We are recycling a show here, but this is a constant at the office and now is the time!

We are going to talk about instalments again.

Make your instalment payments! They are not a suggestion!

We could end the show pretty much right now, but I think it is better to explain why.

If you owe more than $3k in tax payable in the current and one of the 2 previous years, then, in addition to paying that tax payable, you are required to make installments towards the CURRENT year taxes as well.

So, as an example. If you file your taxes in the next month or 2 and you owe $6k, then you will be required to not only pay the $6k before April 30, but you also need to make your 1st of 4 instalments of $1500 in 2026 for the 2026 tax year.

Generally, the instalments are 25% of the amount owing each quarter. Mar 15, Jun 15, Sep 15 and Dec 15.

People often think a couple of things relative to these instalment notices:

1. These are terms to pay your current tax bill – they are not! They are in addition to your current tax bill!
2. The instalments are suggested payments that you should make through the year. They are not suggestions. They are requirements.
3. You can just pay it at the end of the year. That is correct and you will end paying interest on the instalment amounts that you did make throughout the year.

If you are required to make instalments and you do not, you will be charged interest from whenever the instalments were to have been made

AND

If the interest amount is more than $1000, then you will have to ALSO pay penalties from the date the instalments were to have been made.

So, it is absolutely NOT in your best interest to ignore these instalment payments.

People often say, well I did not get a notice from the CRA. The

Reminders

1. personal taxes were due April 30. Even if you have not done them, you can either send the CRA some money if you owe, or you can get your taxes done. The sooner the better!
2. Sole proprietor taxes are due to filed June 15, BUT if you owe money, it is due April 30 as well!
3. Sole proprietor HST have the same deadlines if you have a December 31 deadline.
4. If you would like to have us do your taxes, you can go on our website and there is a questionnaire in the contact us section. If you complete that, we will send you a quotation.

Stay ahead of your instalments and avoid penalties & interest. We can help clarify how to do this!  Make An Appointment today!

Disclaimer:

This article provides information of a general nature only. It is only current at the posting date. It is not updated and it may no longer be current. It does not provide legal or tax advice nor can it or should it be relied upon. All tax situations are specific to each individual. If you have specific tax questions you should book an appointment for a 1 on 1 consultation.