Budget-Friendly Grant Accounting for Canadian Non-Profits and Charities

For the 2025 tax year the filing and payment deadline is 30 April 2026. If you or your spouse carried on a business, the return itself is due 15 June 2026, but any balance owing is still due 30 April 2026. Interest runs on unpaid amounts after the payment deadline, and a late-filed return with a balance owing also attracts a late-filing penalty. Filing on time keeps benefit and credit payments flowing.

A tax deduction is an amount subtracted from your income before tax is worked out, so it reduces the income being taxed rather than the tax bill directly. Its worth depends on your marginal rate: the higher the rate, the more the deduction saves. Common examples are RRSP contributions, child care costs, union dues, moving expenses and business expenses. Credits work the other way, reducing the tax calculated on that income.

Most people file electronically with software the CRA approves for NETFILE, or have a preparer send the return through EFILE. Paper filing is still accepted and takes far longer to process. Before starting, set up My Account, confirm your direct deposit details, and download the slips the CRA already holds so your return matches its records. For the 2025 tax year the deadline was 30 April 2026, with any balance owing due the same day; a 2025 return not yet filed is late, so file it now to stop the late-filing penalty growing.

The basic personal amount is a non-refundable credit that shelters a base level of income from federal tax, so income below it carries no federal tax. The amount is indexed every year, and the enhanced portion is phased out across the second-highest federal bracket, so taxpayers in the top bracket receive only the base amount. Each province and territory sets its own version. On Form TD1 you claim it so your employer withholds less; claim it with one employer only, or too little tax is withheld.

Revenue Canada is the former name of the Canada Revenue Agency. The CRA is the federal body that administers income tax, GST/HST, payroll deductions and benefit payments such as the Canada child benefit, and it collects provincial income tax for every province except Quebec, which runs its own personal system through Revenu Québec. The old name is still in everyday use, so paying Revenue Canada means paying the CRA, and a letter from either is the same agency.

Yes. In Canada the Income Tax Act requires residents to report their worldwide income and pay tax on it, and the Excise Tax Act does the same for GST/HST. Filing is mandatory when you owe tax or when the CRA asks for a return; self-assessment means you calculate the amount yourself, not that paying is optional. Arguments that no law compels payment have failed in Canadian courts and lead to penalties, interest and collection action.

No. GST/HST you charge is tax you collect for the government, so a registrant keeps it out of revenue and reports it on the GST/HST return, claiming input tax credits against it. Report your sales net of the tax on your T2125 or T2. If you are not registered you charge no GST/HST, and the tax you pay on your own purchases is simply part of the cost of each deductible expense.

Not automatically. A refund is overpaid tax coming back, so it turns on how much was withheld against what you owe, not on earning less. Lower income does mean a smaller tax bill and can qualify you for income-tested credits and benefits, which is why lower earners often see money back. Someone with no withholding at all, such as a self-employed person, can earn very little and still owe a balance.

You qualify if you live with an eligible child, are primarily responsible for their care, and are a resident of Canada for tax purposes. You or your spouse or common-law partner must be a citizen, permanent resident, protected person, registered Indian, or a temporary resident meeting the CRA's conditions. The payment is calculated from family net income, so both of you have to file a return every year, even with no income to report.

A charity is not exempt as an organisation. What matters is the supply. Many goods and services a registered charity provides are exempt, so no GST/HST is charged on them and no input tax credit can be claimed on the related costs. A charity making taxable supplies above the small-supplier threshold must register and charge tax at the combined rate for the province of supply, using the special net tax calculation for charities. Public service body rebates recover part of the rest.

Statutory deductions are the amounts an employer must withhold from pay by law: federal and provincial income tax, Canada Pension Plan contributions (Quebec Pension Plan in Quebec) and Employment Insurance premiums, plus the Quebec Parental Insurance Plan for Quebec employees. The employer also pays its own share of CPP and EI. Everything is remitted on a set schedule and reported on T4 slips. Union dues, pension contributions and benefit premiums are contractual, not statutory.

No. Non-profit describes how an organisation is set up and how it may use its funds; tax exempt describes how it is treated for one particular tax. A non-profit can be exempt from income tax and still have to register for and charge GST/HST, remit payroll deductions, and file annual information returns. Only a registered charity or other qualified donee can issue receipts that donors use to claim a credit, and charitable registration is a separate application to the CRA.