Canada Tax Compliance Map

Email: yto4ww@evershinecpa.com
Manager Cindy Victoria Speak in Bahasa, English, and Chinese.
Whats App +886-989-808-249
wechatid: victoria141193

GLA – Canada Corporate Income Tax

GLA-CA-01 GLA Tax Entity

Question from client:
Is Canada corporate income tax a federal income tax? A local income tax?
Or is there a federal and local income tax?
What if the federal income tax and the local income tax are levied separately or levied together?
What is the standard tax rate? What is the special tax rate?

Answer from Evershine RD:
Canada’s corporate income tax is levied by both federal and provincial governments.
All the provinces (except Quebec and Alberta) have entered into agreements with the federal government, such that the taxable income is computed according to federal legislation through the Canada Revenue Agency (CRA), which is responsible for administer and collecting corporate income tax on behalf of the provinces.
Below is a general formulation of Canada’s corporate income taxes:

*CCPC: Canadian-Controlled Private Corporations

Provincial and territorial (not including Quebec and Alberta) tax rates and business limits with effective from 1 January 2021:

GLA-CA-02 Registration

Question from client:
Which government unit is responsible for the collection of Canada corporate income tax?
The registration of the country’s corporate income tax status, that is, the tax certificate number application procedure, paper certificate number application?
Or online account application? URL?
What is the advance certificate number for applying for this certificate number?
Do I need to use the industrial and commercial certificate electronic card to apply?

Answer from Evershine RD:
Canada Revenue Agency (CRA) is responsible for the collection of Canada corporate income tax.
A business number is required for the following CRA program account:

1. GST/ HST
2. Payroll
3. Corporate Income Tax
4. Import/ Export
5. Others

CRA business number (BN) consists of 9-digit number, 2 letters to identify the government program, and 4-digits to identify a specific government account.
If you provided an email address during registration, the BN will be sent to the email address within 48 hours.
You can register for a BN from CRA in several ways:

1. Online using the CRA Business Registration Online (BRO) service at the below link: https://www.canada.ca/en/revenue-agency/services/tax/businesses/topics/registering-your-business/bro-register.html
2. Phone at 1-800-959-5525, answer questions from form RC1
3. Mailing or faxing form RC1 to the nearest tax service office
   https://www.canada.ca/en/revenue-agency/services/forms-publications/forms/rc1.html

After getting BN and register for CRA program accounts done through BRO, it lets you transfer to one of the provinces listed below that has an online business registry service.
*British Columbia – OneStop Business Registry
*Ontario – ServiceOntario – Business services
*Nova Scotia – Registry of Joint Stock Companies
Before you click the Transfer button, make sure you have registered for all the program accounts you need because your session in BRO will end once you connect to one of the provinces.

GLA-CA-03 GLA Order (OD)

Question from client:
What are the order of Canada’s corporate income tax return (information flow determines tax base) and payment (fund flow)?
Pay first and then declare? Report first and then pays? At the same time as the declaration and payment?

Answer from Evershine RD:
Deposit First (DF): Make payment first (by instalments) and then file (declare) T2 Corporate Income Tax Return.

GLA-CA-04 Mechanism of Filing (MOF)

Question from client:
What is the return method for Canada corporate income tax return (information flow determines the tax base)?
Filing cycle: monthly? Every bimonthly? Every season? every half year? Per year?
Electronic filing? Manual filing? Electronic filing and manual filing coexist? If electronic filing is possible: website URL?

Answer from Evershine RD:
Most corporations can file their return electronically using the internet.
It is mandatory for certain corporations with annual gross revenues that exceed $1 million.
You’ll have to use CRA-certified software.
You might have to purchase a tax preparation software package, but the Corporation Internet Filing service is free.
Check Software for information that includes a list of the CRA-certified software.
https://www.canada.ca/en/revenue-agency/services/e-services/e-services-businesses/corporation-internet-filing/software.html

The method of filing tax return:

1. Using tax preparation software.
2. T2 Auto-fill – allows corporations to download information form CRA to their tax preparation software.
3. Through filing in Internet, you require a Web Access Code.To obtain the Web Access Code, you can apply and receive this code within certain commercial tax preparation software packages without having to call the CRA Internet Filing Helpdesk.
4. If you cannot file electronically, we have two types of corporations return available for printing.
   See the link to find out where to mail your return. https://www.canada.ca/en/revenue-agency/corporate/contact-information/tax-services-offices-tax-centres.html
   4.1 https://www.canada.ca/en/revenue-agency/services/forms-publications/forms/t2.html
   4.2 https://www.canada.ca/en/revenue-agency/services/forms-publications/forms/t2short.html

File the corporate income tax return no later than 6 months after the end of each tax year.
The tax year of a corporation is its fiscal period, it may not always at the last day of a month.
If your tax year ends September 23, your filing due date is March 23.

GLA-CA-05 Mechanism of Payment (MOP)

Question from client:
What is the funding method for Canada corporate income tax payment (funds flow)?
Payment cycle: M per month? B every bimonthly? Q every season? H every six months? A every year?
Automatically authorize deduction of ACH (that is, take the initiative of the recipient)?
Electronic remittance to EFT (that is, the payer takes the initiative)?
Bank counter payment OCT?
Or the above methods coexist?

Answer from Evershine RD:
Generally, corporate tax installments are due on the last day of each month (the last day of every complete quarter if you are an eligible small CCPC.
Any balance payable is generally due on the last day of the second month following the end of the tax year.
For new incorporations, you do not have to make installment payments until you have started your second year of operation.
However, for your first year of incorporation, you must pay any tax you owe on or before your balance-due day for that tax year.
Hence you may have to start making installment payments for your second year even before you pay your balance due or file your first return.

You can make your payment:
* Electronically using your financial institutions online. For more information, go to Canada.ca/guide-taxes-payments.
* Online using CRA’s My Payment service at Canada.ca/cra-my-payment.
https://www.canada.ca/en/revenue-agency/services/e-services/payment-save-time-pay-online.html
* By setting up a pre-authorized debit agreement at your convenience through the CRA’s My Business Account at Canada.ca/my-cra-business-account.
* Present your remittance voucher with your payment to the teller. The teller will return the top part to you as a receipt.
You must have an original CRA voucher for your financial institution to accept the payment.

VAT – Canada VAT

VAT-CA-01 VAT Tax Entity

Question from client:
Is Canada VAT federal VAT? Local VAT? Or is there a federal plus local VAT?
What if the federal VAT and local VAT are levied separately or levied together?
What is the standard VAT rate? What is the special VAT rate?

Answer from Evershine RD:
The GST is a federal tax levied at a rate of 5%.
British Columbia, Saskatchewan and Manitoba levy provincial sales taxes (PST) also known as retail sales taxes. Rates are between 6%-8%.
5 provinces have harmonized GST + PST and imposed a single Harmonized sales tax (HST).
HST is a blended federal/ provincial sales tax that includes a 5% federal GST and a provincial component of 8% or 10%.
HST applies to the same tax base and under the same rules as the GST.
The HST rates are as follows:

Québec applies its own VAT, which is the Québec sales tax (QST). Rate is 9.975%.

VAT-CA-02 Registration

Question from client:
Which government unit is responsible for the levying of VAT in Canada?
The registration of Canada’s VAT levy status, that is, the application procedure for VAT certificate number, paper certificate number application?
Or online account application? URL?
What is the advance certificate number for applying for a VAT certificate number?
Do I need to use an industrial and commercial certificate electronic card to apply?

Answer from Evershine RD:
Canada Revenue Agency (CRA) is responsible for the collection of Canada GST.
Taxable exceeds CAD30,000 in the last 4 calendar quarters or in a single calendar quarter must register for GST/HST. Voluntary registration is allowed.
There is no need to register separately for GST and HST because both taxes are accounted for under one tax return and are jointly administered by the Canada Revenue Authority (CRA).
You must open a GST/ HST program account under the Business Number (BN) assigned by CRA.
You can register:
*By Business Registration Online (BRO) portal:
https://www.canada.ca/en/revenue-agency/services/tax/businesses/topics/gst-hst-businesses/account-register.html
*By mail or by fax:
https://www.canada.ca/en/revenue-agency/services/forms-publications/forms/rc1.html

*By telephone: 1-800-959-5525
You will receive a GST/ HST account number to confirm that your registration is complete.
Register for My Business Account to manage your program accounts online.

VAT-CA-03 WWT Order (OD)

Question from client:
What is the order of Canada’s VAT declaration (information flow determines the tax base) and payment (fund flow)?
Pay first and then declare? First declare and then pay?
At the same time as the declaration and payment?

Answer from Evershine RD:
Same Period (SP) – Declare and pay at the same time.

VAT-CA-04 Mechanism of Filing (MOF)

Question from client:
What is the return method for Canada VAT declaration (information flow determines the tax base)?
Reporting cycle: every month? Every bimonthly? Every season? every half year? Per year?
Electronic filing? Manual filing? Or electronic filing and manual filing coexist? If electronic filing is possible: Website URL?

Answer from Evershine RD:

File the GST/ HST return- Form GST 34 via the link below:
https://www.canada.ca/en/revenue-agency/services/e-services/e-services-businesses/gst-hst-netfile/gst-hst-netfile-ready-file-online-check-list.html

If you are eligible to use GST/ HST NETFILE, access the online form through the Ready to file page at https://www.canada.ca/en/revenue-agency/services/e-services/e-services-businesses/gst-hst-netfile/gst-hst-netfile-ready-file-online-check-list.html and enter your information.

You can also access GST/ HST NETFILE by selecting the “File a return” option in My Business Account at https://www.canada.ca/en/revenue-agency/services/e-services/e-services-businesses/business-account.html.

If you file your return using GST/ HST NETFILE, do not send us a paper copy of your return.
The reporting period for GST/HST and QST:

VAT-CA-05 Mechanism of Payment (MOP)

Question from client:
What is the funding method for Canada VAT payment (funds flow)?
Payment cycle: M per month? B every bimonthly? Q every season? H every six months? A every year?
Automatically authorize the deduction of ACH (that is, take the initiative of the recipient)?
Electronic remittance to EFT (that is, the payer takes the initiative)?
OCT payment at the bank counter?
Or the above methods coexist?

Answer from Evershine RD:
Payment options for GST/ HST include the following:

1. Online banking
2. My Payment
3. pre-authorized debit
4. Credit card, PayPal
5. Cheque

Payment period for GST/HST and QST:

Please be aware of below Warning:
The above contents are digested by Evershine R&D  and Education Center in October 2021.
Regulations might be changed as time goes forward and different scenarios will adopt different options.
Before choosing options, please contact us or consult with your trusted professionals in this area.

Contact Us

Toronto Evershine BPO Service Limited Corp.
Email: yto4ww@evershinecpa.com
Manager Cindy Victoria Speak in Bahasa, English, and Chinese.
Whats App +886-989-808-249
wechatid: victoria141193

For how to exchange data files between your Finance Accounting System and Evershine Cloud Accounting Information System, please send an email to HQ4yto@evershinecpa.com
Dale Chen, Principal Partner/CPA in Taiwan+China+UK will be accountable for your case.
Linkedin address: Dale Chen

Additional Information
Evershine has 100% affiliates in the following cities:
Headquarter, Taipei, Xiamen, Beijing, Shanghai, Shanghai,
Shenzhen, New York, San Francisco, Houston, Phoenix Tokyo,
Seoul, Hanoi, Ho Chi Minh, Bangkok, Singapore, Kuala Lumpur,
Manila, Dubai, New Delhi, Mumbai, Dhaka, Jakarta, Frankfurt,
Paris, London, Amsterdam, Milan, Barcelona, Bucharest,
Melbourne, Sydney, Toronto, Mexico

Other cities with existent clients:
Miami, Atlanta, Oklahoma, Michigan, Seattle, Delaware;
Berlin, Stuttgart; Prague; Czech Republic; Bangalore; Surabaya;
Kaohsiung, Hong Kong, Shenzhen, Donguan, Guangzhou, Qingyuan, Yongkang, Hangzhou, Suzhou, Kunshan, Nanjing, Chongqing, Xuchang, Qingdao, Tianjin.

Evershine Potential Serviceable City (2 months preparatory period):
Evershine CPAs Firm is an IAPA member firm headquartered in London, with 300 member offices worldwide and approximately 10,000 employees.
Evershine CPAs Firm is a LEA member headquartered in Chicago, USA, it has 600 member offices worldwide and employs approximately 28,000 people.
Besides, Evershine is Taiwan local Partner of ADP Streamline ®.
(version: 2024/07)

Please send email to HQ4yto@evershinecpa.com

More City and More Services please click Sitemap