Pocket-Friendly Internal Financial Reporting for Canadian Businesses

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.

Your marginal tax rate is the rate on your next dollar of income, not on your income as a whole. Federally for 2026 that is 14%, 20.5%, 26%, 29% or 33% depending on the bracket you have reached, and your province's rate stacks on top, so an Ontario earner in the 26% federal band adds the Ontario rate for their own band. The two sets of thresholds rarely line up, so add the two rates together.

No. Capital is the owner's stake in the business, so it sits in equity, not liabilities. On a balance sheet, assets equal liabilities plus equity, and the capital account belongs on the equity side alongside retained earnings. Money the owner lends the business is different, because the business owes it back, and that is a liability. Keeping owner capital, owner loans and drawings in separate accounts prevents a messy reconciliation at year end.

Land value normally comes from an appraisal, or from splitting a single purchase price between land and building on a reasonable basis such as an appraisal or the land-to-building ratio on the municipal assessment notice. The split matters because capital cost allowance can be claimed on the building but never on land, and each part carries its own cost for calculating a gain on sale. Keep the appraisal or assessment notice with your records to support the allocation.

Businesses are rarely exempt from income tax; what changes is the rate and the credits. A Canadian-controlled private corporation can claim the small business deduction, giving a federal rate of 9% on the first $500,000 of active business income for 2026 instead of the 15% general rate. For GST/HST you can stay unregistered as a small supplier while taxable revenue stays under $30,000, and some supplies are exempt outright. Registered charities follow separate rules.

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.

The realistic options are CRA-certified software you run yourself, a seasonal walk-in preparer, a free volunteer clinic if your income is modest and the return is simple, or an accounting firm. A firm earns its fee once there is self-employment, rental, investment or cross-border income, or a CRA letter to answer. We agree the fee before work starts, and you pay after the service. The first 15-minute consultation is free.

Tax law is the body of statutes, regulations and court decisions that set who pays tax, on what, and when. In Canada the main pieces are the federal Income Tax Act and the Excise Tax Act, which covers GST/HST, plus each province's own tax statutes. The CRA administers these rules and publishes guides, folios and interpretations explaining its view, while the Tax Court and higher courts settle disputes over what the wording means.

Start with total income from all sources, subtract deductions such as RRSP contributions to get taxable income, then apply the federal graduated rates and your province's rates to that figure. Subtract non-refundable credits, including the basic personal amount, then subtract tax already withheld on slips and any instalments paid. What is left is your balance owing or refund. CRA-certified tax software does this arithmetic; the CRA also publishes the rate and credit tables.

Divide income tax expense by profit before tax to get the effective rate. It differs from the statutory rate because of permanently non-deductible items, credits and timing differences between accounting and tax treatment. Income tax payable is a current liability and income tax receivable a current asset, so a refund is recorded against that receivable rather than as revenue. Internet is normally an operating expense under utilities or office costs, and property taxes are expensed unless properly capitalised to a project under construction.

Deductions reduce taxable income, and the largest for most people is an RRSP contribution: the room is 18% of prior-year earned income up to $33,810 for 2026 and $32,490 for 2025, less any pension adjustment, plus unused room carried forward. Other options include claiming the employment or self-employment expenses you are entitled to, carrying charges on investment loans, childcare and eligible moving costs, splitting eligible pension income with a spouse, and realising capital losses to offset gains.

Day camps and day sports schools qualify as child care when you paid them so you could work, run a business or study, and the child meets the age and residency conditions. Overnight camps and boarding schools also qualify, but only up to a weekly limit per child rather than the whole fee. A program that is mainly instruction, such as music lessons or skills coaching, may not count. Keep the receipt showing the child's name and the care amount.