Low-cost Cross Border Tax & Accounting for Canadian Businesses and Individuals

For the 2025 tax year the filing and payment deadline is 30 April 2026. If you or your spouse were self-employed, the filing deadline moves to 15 June 2026, but any balance owing is still due 30 April 2026. Interest starts the day after the payment deadline, and a late-filing penalty applies on top when a return with a balance owing is filed late. File on time even with nothing owing, because income-tested benefits are recalculated from the filed return.

Canadian income tax is built up in layers. You total your income for the year, subtract the deductions you qualify for to arrive at taxable income, then apply the federal brackets and your province's brackets to that figure. Each bracket rate applies only to the income sitting inside it, so earning more never retaxes the dollars below. Non-refundable credits, starting with the basic personal amount, come off the tax afterwards. Look up the CRA bracket table for the tax year you are filing.

Canada taxes income in graduated brackets, so only the income above a threshold is taxed at that bracket's higher rate and moving up a bracket never reprices the income below it. There is one federal set of brackets and a separate set for each province and territory, and the thresholds are indexed to inflation every year. Look up the current figures for your province on the CRA rate tables rather than relying on an older list.

Canada taxes income at graduated rates: federal brackets plus your province's brackets apply, and only the income sitting inside a bracket is taxed at that bracket's rate. The rate on your next dollar is your marginal rate, while the share of your total income you actually pay is lower, because credits such as the basic personal amount shelter the first slice. Look up the current federal and provincial brackets for your province, or run your figures through the CRA payroll calculator.

Child support under current rules is neither deductible for the payer nor taxable for the recipient. Spousal support is treated differently: where it is paid as a periodic allowance under a court order or written agreement, the payer deducts it and the recipient reports it as income. Lump sums and property transfers usually do not qualify. Register the order or agreement with the CRA and keep proof of every payment, because the deduction is often reviewed.

Canada uses a basic personal amount rather than an exemption. For 2026 it is $16,452, tapering to $14,829 as net income runs from $181,440 to $258,482. It works as a non-refundable credit, so income up to that level attracts no federal tax, and each province sets its own equivalent amount. Separately, CPP contributions for 2026 ignore the first $3,500 of pensionable earnings; that basic exemption belongs to payroll, not to income tax.

Child care you paid so you could work, run a business or study is a deduction rather than a credit, and it normally must be claimed by the lower-income spouse. Daycare, nursery school, day camps and a caregiver can all qualify. The claim is capped per child according to the child's age and status, and limited by earned income. Check the CRA's child care expenses guidance for current caps, and keep receipts naming the provider, with a social insurance number for an individual caregiver.

For a return filed online the CRA usually issues the refund in about two weeks. A non-resident return can take up to sixteen weeks. Timing slips if the CRA reviews a claim and asks for receipts, if the return is filed on paper, or if the refund is applied against an existing balance or a debt to another government program. Setting up direct deposit in CRA My Account is the fastest way to receive it.

A GST cheque is the GST/HST credit, a tax-free quarterly payment from the CRA that offsets sales tax for people with modest incomes. You do not apply for it: filing your T1 return is the application, and the CRA works out entitlement from your family net income, marital status and number of children. Payments arrive in July, October, January and April, by direct deposit or cheque. File every year even with no income, or the payments stop.

Employment, business and investment income of a status Indian is exempt where the income is situated on a reserve. The CRA applies connecting-factor tests: for employment, usually whether the duties were performed on reserve; for business income, where the activities take place; for interest, where the account and the debtor are located. Employment income earned off reserve is generally taxable. See the CRA's Indian Act Exemption for Employment Income Guidelines before deciding.

Line 23600 is not on the T4. It is a line on the T1 income tax return, where it reports net income after deductions. The T4 gives you employment income in box 14 along with the amounts withheld, and those figures feed into the return that produces line 23600. When a lender, a benefit application or a sponsorship form asks for line 23600, take it from your filed return or your notice of assessment in CRA My Account.

A treaty exemption is relief given by a tax treaty between Canada and another country so the same income is not taxed twice. Depending on the article relied on, it can remove Canadian tax entirely, cap a withholding rate, or give taxing rights to only one of the two countries. The relief is not automatic: you usually certify your residence to the payer or claim it on a Canadian return, and keep the supporting documents.