If tax deadlines make your head spin, you’re not alone!
Leave it to the government to make it all very confusing, so let’s simply things. We’ve rounded up all the major dates that matter for your taxes to make this season as stress-free as possible. Filing your returns on time helps you avoid interest or penalties and get your refund earlier. Ever wonder what these penalties are? We’ll break it down for you.
Individual Tax Return Deadline (T1)
If you did not earn business income in 2022, the tax filing AND payment deadline for your 2022 tax return is May 1, 2023 (since April 30 is a Sunday).
The CRA usually expects individual taxpayers to submit their income tax returns by April 30 every year, but when it falls on a weekend, the deadline is extended to the following business day.
If you want to file early, the CRA will open its NETFILE service on February 20, 2023 to electronically receive submitted returns.
Mailed responses must be received or postmarked by the due date, and electronically submitted returns must be submitted by midnight local time of the date they are due.
Self-employed Tax Return Deadline (T1 & T2125)
If you earned business income in 2022 (self-employed, sole proprietor, or partner), the CRA gives you a bit longer to submit your income tax return — June 15, 2023. However, if you have a balance owing for 2022, you must pay it on or before May 1, 2023.
This deadline is a bit tricky because if you owe taxes, you’re required to submit payment by May 1, even though the actual filing of the return is not due until June 15. Thanks for making things complicated, Canada!
This May 1st payment deadline typically falls on April 30th every year, but because that’s a Sunday, the CRA extends the date to the next business day.
It’s important to note that IF your self-employment income is mostly related to a tax sheltered investment OR if you had rental property income, your 2022 return and payment is due May 1, 2023.
Corporate Tax Return Deadlines (T2)
Corporate tax deadlines are a little different than personal tax deadlines. Corporate tax return filings are due 6 months after the year-end, but exact due dates depend on the company’s year-end date.
When a corporation’s year-end date is the last day of a month, the return is due on the last day of the 6th month after the year-end. For example, a December 31, 2022 year-end would have a June 30, 2023 due date.
When the year-end date is NOT the last day of a month, the return is due the same day of the 6th month after the year-end. For example, a September 15, 2022 year-end would have a March 15, 2023 due date.
BUT, if you owe anything on that T2, you’re best to file your return sooner to avoid late payment penalties. Here’s why…
Corporate Tax Payment Deadline (from T2’s)
If you owe corporate taxes according to that T2 you filed, the due date for payment is a few months earlier than the due date for actually filing the tax return. Thanks, government for making things so complicated!
This means, to avoid late payment penalties, if you’re going to owe tax, your T2 return should be filed and paid 2 months after your year-end
However, there’s an exception where taxes are due 3 months after the year-end when the following criteria apply:
∙ The corporation is a Canadian-Controlled Private Corporation.
∙ The corporation claimed the small business deduction for the current or previous year.
∙ The corporation and all associated corporations had taxable income less than $500,000 in the previous year.
The exception noted above is quite common, so there’s a good chance your corporate taxes are due 3 months after the year-end.
Because it’s a bit trickier, we recommend asking your accountant or sending us a message to ensure you’ve got the right date.
GST / HST Return Deadlines
Due dates vary depending on the reporting period of the business.
MONTHLY FILERS
The return and amounts owing are due 1 month after the end of the reporting period. For example, a monthly filing period for the month of June means the return is due July 31st.
QUARTERLY FILERS
The return and amounts owing are due the last day of the month following the end of the quarter. For example, the quarter from July 1 – September 30 means the return is due October 31st.
ANNUAL FILERS
(Except Individuals With December 31 Year-Ends)
When GST / HST returns are filed annually by a business that is not an individual, the return and amounts owing are due 3 months after the reporting period end date.
For example, a July 1, 2022 – June 30, 2023 filing period means the return is due September 30, 2023.
ANNUAL FILERS
(For Individuals With December 31 Year-Ends)
Individuals who file GST / HST annually and have December 31, 2022 as their fiscal year and tax year-ends have slightly different due dates. They mirror the tax due dates for self-employed individuals:
∙ GST owing is due May 1, 2023
∙ Filing of the GST returns is due June 15, 2023
Due Dates For Tax Installment Payments
Whether you’re self-employed or employed by someone else, if you make installment payments throughout the year to avoid a large bill at tax time, you have four due dates throughout the year:
∙ March 15th
∙ June 15th
∙ September 15th
∙ December 15th
Tax instalment penalty
You may have to pay a penalty if your instalment payments are late or less than the required amount. The CRA applies the instalment penalty only if your instalment interest charges for 2023 are more than $1,000.
RRSP Contribution Deadline
You can contribute to your RRSP until March 1, 2023 and still have it reduce your 2022 taxes owing.
When To Remit Payroll Source Deductions
The due date for remittances depends on when you pay your employees and what type of remitter you are. In most cases, you’ll remit your source deductions by the 15th of the month after you pay or give remuneration to your employees. Remuneration includes taxable benefits and allowances. If you are a new small employer, different rules may apply.
When To File a T4/T4A Return
You have to file T4 or T4A information returns and send information slips to your employees by the last day of February every year.
Penalties For Late Personal / Self-employed Taxes
As an individual, sole proprietor, self-employed, or partner, filing your taxes late when you’ve earned a refund or don’t owe any further tax will not result in any fees or penalties. However, if you owe money and file late, the CRA charges you a late filing penalty plus interest on the tax owing amount.
Penalties are charged at 5% of the taxes due plus an additional 1% for each month late up to 12 months.
For example, if you owe the CRA $10,000 and you file your tax return 5 months late, the CRA will apply a 10 percent penalty and your tax bill is increased to $11,000.
However, if the CRA charged a late-filing penalty for 2019, 2020 or 2021 and requested a formal demand for a return, your late-filing penalty for 2022 will be 10% of your balance owing. You will be charged an additional 2% for each full month that you file after the due date, to a maximum of 20 months.
Interest is charged on any unpaid balances at the prescribed rates, established by the CRA on a quarterly basis. For example, for the first calendar quarter of 2023, the interest rate is 8%.
Penalties For Late Corporate Taxes
Penalties can be more onerous for corporations, particularly when the CRA issues a demand to file, and is 10% of the unpaid tax plus 2% for each complete month that the return is late up to a maximum of 20 months.
Interest is charged on any unpaid balances at the prescribed rates, established by the CRA on a quarterly basis. For example, for the first calendar quarter of 2023, the interest rate is 8%.
Penalties For Late GST / HST
If the balance due is nil or if you are entitled to a refund then interest and penalties will not apply unless you receive a notice and still fail to file at which point you will be charged a flat fee of $250 plus interest until you file.
Penalties on balances due are charged at 1% of unpaid balances plus ¼ of the 1% multiplied by the number of months the return is late (up to a maximum of 12 months.).
For example: If the GST / HST payable is $1,000 and the return is 3 months late, you will owe $10 + $2.5 x 3 = $17.50.
Interest is charged on any unpaid balances at the prescribed rates, established by the CRA on a quarterly basis. For example, for the first calendar quarter of 2023, the interest rate is 8%.
Penalties For Late Payroll Remittances
Failure to meet the CRA’s payroll obligations results in penalties and interest; there are several types of penalties for payroll accounts. Failure to deduct can result in a penalty of 10% for the first failure, and will go up to 20% with any additional failures. Late filing or non-payment penalties start at 3% and go up to 20%.
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