Pocket-Friendly Intercompany Guarantee Review for Canadian Businesses and Individuals

Online banking is the simplest route: add the CRA as a payee, select the account and tax year precisely, and pay from your chequing account. CRA My Payment takes debit card payments, and pre-authorised debit can be scheduled in My Account or My Business Account for a single amount or a run of instalments. Corporations and GST/HST registrants use the same channels under their business number. Keep the confirmation number and allow several days for the payment to post.

Sign in to CRA My Account, or use the CRA's mobile app, where the return shows as received, in process or assessed, and the refund amount and payment date appear once it has been assessed. The CRA also runs an automated telephone service giving the same information. A representative you have authorised through Represent a Client can check it for you. If the status has not moved past the published processing time, the return is probably under review.

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.

For the 2025 tax year the federal rates were 14.5% on the first $57,375 of taxable income, 20.5% to $114,750, 26% to $177,882, 29% to $253,414, and 33% above that. The 14.5% is a blended rate: the lowest bracket was cut from 15% to 14% effective 1 July 2025, so the whole year is charged at the average of the two. Provincial tax applies on top.

Childcare services for young children, supplied mainly so a parent can work or study, are exempt from GST/HST, so a daycare does not charge tax on those fees and cannot claim input tax credits on the related costs. The operator's earnings are still taxable income, reported on a T2125 or a T2 depending on the structure. Parents deduct eligible childcare costs on the T1 within the limits on the CRA's child care expenses page.

Rent from a relative is reportable when the arrangement is commercial, meaning market rent charged with a view to profit. Where you charge a family member only enough to cover a share of the costs, the CRA treats it as a cost-recovery arrangement: you report no income and claim no loss or expenses. Charging below market rent and then deducting a loss is the combination the CRA disallows. Keep the lease and payment records either way.

Canada runs a self-assessment system: you report your own income, deductions and credits, and the CRA checks the return afterwards. The agency receives your slips but not your rent, medical costs, childcare, donations, tuition or business expenses, so a return prepared for you from slips alone would miss deductions. The CRA does help part way, filling slip data into approved tax software automatically and inviting some filers with simple, lower-income situations to file by phone or online.

Yes. Where the balance cannot be paid at once, ask the CRA for a payment arrangement through My Account or by phone; you propose the amounts and dates and the CRA reviews what you can afford, sometimes asking for income and expense details. Interest keeps running until the balance clears, so pay as much as possible up front. Separately, the CRA can require instalment payments toward the current year when tax withheld at source does not cover enough of it.

Double taxation is lawful, and relief comes through credits and treaties rather than exemption. A Canadian resident taxed abroad on foreign income normally claims a foreign tax credit, while Canada's tax treaties cap withholding and decide which country taxes first. Inside Canada, corporate profits paid out as dividends carry a gross-up and dividend tax credit so the combined burden approximates a single level of tax. US LLCs are a common trap, since Canada usually treats one as a corporation.

Not every dollar counts. The medical expense credit applies only to eligible expenses above a threshold, set as the lesser of a fixed percentage of your net income or a flat dollar amount the CRA indexes each year, so a lower income means a lower threshold. What clears the threshold becomes a non-refundable credit rather than a refund of the cost. You can pick any twelve-month period ending in the tax year and pool the family's receipts.

Yes. Dividends and most other investment income are taxable in the year received, but interest is reported as it accrues each year, so a compound GIC or strip bond produces taxable interest annually even though nothing is paid out until maturity; the amounts usually appear on a T5 slip, and income below the slip-issuing threshold still has to be reported. A share's rise in value is taxed only when you sell, and only part of the resulting capital gain is included in income.

Basic groceries are zero-rated for GST/HST, so milk, bread, vegetables, meat, eggs and similar staples carry no tax. Tax applies to food the rules treat as something other than a basic grocery: carbonated drinks, candy, snack foods, most prepared or heated meals, restaurant orders, single servings of many products, and food sold together with a service. The combined rate depends on the province of supply, so check the rate where the sale takes place.