Calculate your instalment payments
Determine how to calculate your GST/HST instalment payments based on your situation.
You can calculate your instalment payments online. To use the instalment payment calculator service, see My Business Account or Represent a client.
Special rules for the first time you file
Even if your net tax is less than $3,000 for your first fiscal year, you may have to make instalment payments in your second fiscal year.
This might be the case if you are an annual filer, and your first year as a GST/HST registrant was shorter than 12 months.
If so, divide your net tax for that reporting period by the number of days you were registered in that fiscal year. Multiply this amount by 365 (number of days). If the result is $3,000 or more, and your net tax for your second year will also be $3,000 or more, you will have to make instalment payments in your second year.
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Example
You are a sole proprietor. Your first year as an annual filer began on October 13, 2020, and ended on December 31, 2020. Your net tax for those 80 days was $800.
To determine if you need to make instalment payments in 2021, calculate your annual net tax for 2020:
- $800 (net tax for 2020) ÷ 80 (days) × 365 = $3,650 net tax for a full year
Your annual net tax 2020 is greater than the $3,000 threshold. You need to make equal quarterly instalment payments in 2021 if your 2021 net tax will also be $3,000 or more.
To base your instalment payments on your annual net tax for 2020, calculate the amount of each instalment payment:
- $3,600 ÷ 4 = $900
You have two payments due on April 30, 2021:
- your net tax of $800 for 2020
- your first instalment for 2021 of $900
Base your instalment payments on the previous year
These quarterly payments are usually equal to one-quarter (¼) of your net tax from the previous year.
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Example
You are a business with a December 31 fiscal year-end. Your net tax for the 2020 fiscal year was $4,000.
The Canada Revenue Agency will calculate your quarterly instalments at $1,000 each ($4,000 ÷ 4).
Your first instalment is due April 30, 2021.
Base your instalment payments on the current year
You may also choose to base your quarterly instalment payments on an estimate of your net tax for the current year if you expect that it will be less than it was for the previous year.
However, if you estimate your instalments based on your current year and the instalment payments you make are less than the amount you actually should have paid, we will charge instalment interest on the difference.
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