Tax Instalments

If you expect to owe more than $3,000 in net federal tax (or $1,800 in Quebec) in both the current year and either of the two preceding years, the CRA requires you to make quarterly instalment payments. This commonly applies to self-employed individuals, landlords, investors, and retirees with significant income not subject to source deductions.

Instalments are due March 15, June 15, September 15, and December 15. The CRA sends instalment reminders suggesting amounts based on three methods: the no-calculation option (pay last year's amounts), the prior-year option (based on last year's return), or the current-year option (based on your estimate of current-year tax).

If you don't pay your instalments or pay late, the CRA charges instalment interest (compounded daily at the prescribed rate) and may charge a penalty if interest exceeds $1,000. To avoid surprises, review your expected tax liability quarterly and set aside approximately 25–30% of your non-deducted income for tax payments.