Budget-Friendly GRIP and Eligible Dividend Planning for Canadian Businesses

Some are. Legal fees are deductible when they relate to earning income or defending a tax position, such as collecting salary or wages owed to you, objecting to or appealing an assessment, or running a business. Fees paid to obtain or enforce support are generally deductible for the recipient. Fees for the divorce itself, for custody, or for personal disputes are not, and fees to acquire property are usually added to that property's cost instead.

For personal income tax, your account number is your social insurance number. For a business it is the nine-digit business number plus the two-letter program identifier and four-digit reference, so corporation tax, GST/HST and payroll each have their own account. Select the matching payment type and the correct tax year or period as well: a payment posted to the wrong program or year leaves the balance you meant to clear still outstanding and still accruing interest.

Start with the structure. An unincorporated business reports on form T2125 inside your personal T1, due 15 June 2026 for the 2025 year, with any balance still payable by 30 April 2026. A corporation files a T2, due six months after its fiscal year end. Either way, reconcile your bookkeeping first, separate business from personal spending, keep records for six years, and claim capital purchases through depreciation rather than as an outright expense.

Yes. Property tax is charged by your municipality and is owed whether or not the home carries a mortgage. Many lenders collect it alongside your mortgage payment and remit it for you, which is why it can look like a single bill; other lenders leave you to pay the municipality directly. Your mortgage statement shows which arrangement applies. Property tax on your own home is not deductible, though it is on a rental or a home office share.

Gather your slips, such as T4, T5 and T4A, then report total income, subtract deductions like RRSP contributions to reach taxable income, apply federal and provincial credits, and compare the result with tax already withheld. Tax software approved by the CRA for electronic filing does the arithmetic and submits the return; online filing for the 2025 tax year opened 23 February 2026. The federal basic personal amount for 2026 is $16,452, tapering to $14,829 as net income rises.

Tax preparation fees are deductible when they relate to earning income. A self-employed person or a partner deducts the accounting fee on the business statement, Form T2125, and a rental owner deducts it on the rental statement, Form T776. A salaried employee with a straightforward T1 generally cannot claim it. Fees paid to prepare an objection or an appeal of an assessment are also deductible, and fees for investment advice may qualify as carrying charges.

Sign in to CRA My Account and open the tax returns section, where assessed returns and notices of assessment for several past years can be viewed and saved as PDFs. The copy the CRA holds reflects what was actually assessed, including any change the agency made. If you cannot sign in, request copies by phone or by mail, or ask whoever prepared the return for their file copy.

Line 23200 is other deductions: amounts you may deduct that have no line of their own. Common entries include legal fees paid to collect salary or a pension, repayments of employment insurance or other benefits, certain pension income repaid to the payer, and depletion allowances. Each entry needs its own supporting documents, which the CRA often asks to see. It sits in the net income section, so it reduces the income used to test benefits as well as tax.

No fixed multiplier works, because income tax is progressive and CPP and EI stop at annual ceilings, so the deduction rate changes as pay rises. The practical method is iterative: pick a gross figure, run it through the CRA's payroll deductions online calculator, compare the net to your target and adjust until they meet. Payroll software runs the same loop automatically. Where an employer guarantees a fixed net amount, the employer absorbs the tax and the calculation is redone each period.

Social assistance payments are not taxed, but they must be reported. The payer issues a slip, the amount is included in net income and then deducted again before taxable income is reached, so no tax results. Reporting matters because net income drives income-tested benefits and credits. Filing a return every year is therefore important for anyone on social assistance, since the GST/HST credit and the Canada child benefit are only paid when a return is filed.

Tax debt belongs to the person who owes it, so a spouse is not automatically liable. Exposure arises in specific situations. Property or money transferred from the indebted spouse while a balance was outstanding can be pursued up to the value transferred, jointly held accounts and assets can be reached, and jointly claimed benefits or credits can be recovered from either partner. Canada has no joint return, so each person files and is assessed separately.

Employment income is taxed at source, so the levers are deductions and credits rather than avoidance. RRSP contributions reduce taxable income, and Form T1213 asks the CRA to lower the tax withheld from your pay for deductions you know you will claim. The CRA publishes no processing standard for it, so allow several weeks and send the request in the autumn before the year it applies to; a letter of authority covers one tax year only. Union dues, professional fees, child care and employer-approved employment expenses also help.