Corporate Tax Instalment Calculator

How corporate tax instalments work

A corporation has to prepay its tax through the year once tax owing is more than $3,000 both this year and last — below that, the whole bill can simply be paid with the return. There are three ways to size the payments: the prior-year option (last year’s tax divided evenly, which is what this calculator shows), the current-year option (this year’s estimated tax), and a combined option that starts from the year before last. CRA charges no interest as long as the payments match whichever option produces the lowest total, so a corporation whose income is falling can safely pay less than the prior-year amount.

The default schedule is monthly, due the last day of each month. Small CCPCs earn the lighter quarterly schedule — four payments due the last day of each quarter — if the corporation claimed the small business deduction with taxable income of $500,000 or less, has taxable capital of $10 million or less, and has a perfect compliance record for filings and remittances. Lose the perfect record and the schedule reverts to monthly. Provinces that collect their own corporate tax apply their own thresholds and schedules alongside CRA’s.

What this calculator does not cover

It does not compute the current-year or combined options, which need an income forecast rather than a single input — worth doing when income is dropping, since they can cut the payments legitimately. It also does not handle a corporation’s first tax year (instalments are generally not required until there is a prior year of tax to measure against), short tax years, or the separate provincial instalment systems where they exist. Instalment shortfalls attract interest at CRA’s prescribed rate, and persistent large shortfalls can add a penalty on top. For the surrounding dates — year-end filing and balance-due deadlines — use the tax deadline calculator, or have our corporate tax team set the schedule for you.