Generally, corporations have to pay their taxes in monthly instalment payments or quarterly instalment payments. An instalment payment is a partial payment of the total amount of tax payable for the year.
There are special situations when you do not have to pay instalments.
Instalments are calculated based on the parts of the federal Income Tax Act that apply to your corporation, as well as your provincial and territorial tax:
- Parts I, VI, VI.1, and XIII.1:
- Part I – Tax on income;
- Part VI – Tax on capital of financial institutions;
- Part VI.1 – Tax on corporations paying dividends on taxable preferred shares; and
- Part XIII.1 – Additional tax on authorized foreign banks;
- Part XII.1 – Tax on carved-out income; and
- Part XII.3 – Tax on investment income of life insurers.
Forms and publications
- Guide T4012, T2 Corporation – Income Tax Guide
- Guide T7B-CORP, Corporation Instalment Guide
- Worksheet T2WS1, Calculating estimated tax payable and tax credits for 2017
- Worksheet T2WS2, Calculating monthly instalment payments for 2017
- Worksheet T2WS3, Calculating quarterly instalment payments for 2017
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