Economical Transfer Pricing Documentation for Canadian Businesses

File a T1 return for the year, sending it electronically with CRA-certified software or mailing a paper return. Gather your slips and receipts first and check them against the ones listed in My Account. For the 2025 tax year the filing and payment deadline was 30 April 2026, or 15 June 2026 to file if you or your spouse were self-employed, with payment still due 30 April 2026. CRA online filing for 2025 returns closes 29 January 2027.

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.

If you owe nothing, no penalty applies, but a refund and benefit payments such as the Canada child benefit and the GST/HST credit are held up until the return is processed. If you owe, a late-filing penalty is charged and interest runs on the balance and compounds daily from the day after the due date. For the 2025 tax year the deadline was 30 April 2026. File even if you cannot pay, because the penalty is driven by filing, not payment.

You pay no tax on them. Workers' compensation benefits are reported on a slip, entered on the return and then removed by a matching deduction, so they do not add tax. They do count in net income used for benefits and credits, so they can change what you receive. A wage top-up your employer pays while you are off work is ordinary taxable employment income. File even if compensation was your only income for the year.

A zero-rated supply is a sale that is taxable at 0%, so you charge no GST/HST but you can still claim input tax credits on the costs of making it. Common examples include basic groceries, prescription drugs, most medical devices, agricultural and fishing products, and many exports and international freight services. That input tax credit recovery is the practical difference from an exempt supply, where no tax is charged and no credits are available.

Often yes. A non-resident business making taxable supplies in Canada must register and charge GST/HST once it passes $30,000 of taxable revenue over four consecutive calendar quarters or within a single quarter, using the rate for the customer's province: 5% GST, 13% in Ontario, 14% in Nova Scotia from 1 April 2025. Simplified registration rules apply to digital products and platform sales to Canadian consumers. A US supplier also pays GST/HST on its own Canadian purchases.

Prior-year returns can still be filed, and the CRA accepts several years back. Each year is filed on that year's own forms, so gather the slips and receipts for each one, pull missing slips from your CRA account, and file the oldest year first so carry-forward amounts flow correctly into later years. Interest and a late-filing penalty apply to any balance owing. If income was left out deliberately, ask about the CRA's Voluntary Disclosures Program before filing.

Taxable value is the amount a tax is actually calculated on, after the exemptions and adjustments that apply to that particular tax. For property tax it is the assessed value your assessment authority sets. For sales tax it is the price charged for the supply, though Quebec applies QST of 9.975% to the pre-GST price. For income tax the equivalent is taxable income. Where a value has to be estimated, the usual standard is fair market value on the relevant date.

Generally no. Exports of goods and most services supplied to a non-resident are zero-rated, so no tax is charged, you still report the sale, and you still claim input tax credits on your costs. Exceptions apply, including services relating to real property in Canada and supplies to a non-resident who is registered here. Within Canada the place-of-supply rules follow the customer, so an Ontario business billing a Quebec customer charges 5% GST rather than 13% HST, using 2026 rates.

Schedule 5 is where you claim the amounts for a spouse or common-law partner and dependants: the spouse or common-law partner amount, the amount for an eligible dependant, the Canada caregiver amount and amounts for an infirm dependant. For each person you enter the name, relationship, date of birth and net income, and the schedule works out what carries to your return. Tax software builds it from the family details you enter, so the net income figures must be accurate.

Start with total income: employment, business, investment, pension and other slip amounts. Subtract deductions such as RRSP contributions, union dues, child care and support paid to reach net income. Subtract the deductions allowed at the following step to reach taxable income, which is the figure the tax brackets apply to. Credits, including the basic personal amount, then reduce the calculated tax rather than the income itself.

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.