Online payment is currently one of the most prominent payment options in Canada. The conventional way of paying taxes was the physical method of visiting your financial institution. Thankfully, you can now pay your taxes online. The online payment method is an error-free process that is safe and stable.
The offline procedure requires that you visit a physical office of your corporation and request the appropriate tax form. However, most Canadian tax consulting services will advise that you pay your tax online to aid a seamless transaction.
If you are a Canadian resident and want to pay taxes to the Canadian revenue agency, you will first need a Canadian financial institution’s online banking option. ATB online (for individuals), ATB financial (for business), Citibank, BMO, etc., are some of the financial institutions preferred for online banking with CRA. You can pay both individual and business taxes through an online channel.
Paying Individual Tax
You can pay your taxes to the Canadian revenue agency online using this process:
- Sign in to a financial institution’s online banking service
- Click the option “add a payee.”
The various options available are:
- CRA-current year tax return
This is the option for the current tax return. It can be accessed only once per return.
- CRA-tax amount owing
This is the option to pay any pending amount you are owing to the CRA.
- CRA-tax installment
It is an option to repay a Canada emergency response benefit, Canada recovery sickness benefit, Canada recovery caregiving benefit, or a Canada emergency student benefit.
Once you click on the payment type you want to make, proceed to input:
- The nine-digit social insurance number is the CRA account number.
It is advisable to pay on time to avoid extra charges.
Paying Business Tax
You can pay your business taxes online by:
- Signing into your financial institution’s online banking service for business
- Click the option “app a payee.”
The various options available are:
- Federal – Corporation Tax Payments – TXINS
- Federal – GST/HST Payment – GST-P (GST-P)
- Federal Payroll Deductions – Regular/Quarterly – EMPTX – (PD7A)
- Federal Payroll Deductions – Threshold 1 – EMPTX – (PD7A)
- Federal Payroll Deductions – Threshold 2 – EMPTX – (PD7A)
- Federal – Canada emergency wage subsidy repayment
Once you click on the payment type you want to make, proceed to input your business number:
- Your 15 digit business number is to be entered as your CRA account number.
Make payment in advance to ensure timely receipt.
My Payment Option
My Payment is an online payment option that facilitates tax payment via the Canada revenue agency using your bank access card. Both individuals and businesses can access this payment option. You can only use debit cards for this option.
Financial institutions that support My Payment are BMO, Scotiabank, RBC, TD, Envision Financial, and Libro credit union support etc. This service is offered via Interac Online. It is one of the swiftest and most secure ways to make payments to the CRA.
If you’re paying via Interac, you should know that there’s a 24 hrs $3000 limit. Your transaction will return an error if your transaction amount is more than $3000 CAD. You can solve this by making two or more payments on different days.
Taxes that can be paid via My Payment Option include:
- Individual Income tax
- Balance/ arrear payments, installment, and payments on the filing
- Child and family benefits payment
- Goods and service tax
- Payroll source deductions
- Corporation income tax
- Excise duty
- Excise tax
- Air traveler’s security charge
- Insurance premium tax
- Export charge
- Non-resident withholding tax-part XIII
CIBC Government Payment And Filing Service
The CIBC Government Payment Service was designed to provide Canadians with a more efficient and suitable way to report and remit business taxes. Below is a guide on how to use this service:
- Sign in to the CIBC online banking
- Select “Pay & File Taxes” – This is available on the menu on the left
- Click on start to commence your registration process
- Ensure to read the terms and conditions of CIBC payment service
- Provide all necessary details – this includes the name of your business, contact name, phone number
- Proceed to choose the account you would like to use to pay service charges
- Select “Enroll” to complete the registration.
CRA Business Tax Reminder App
CRA Business Tax Reminder App was initiated to create reminders related to installment payments or tax returns. It is a tool for small or medium-sized businesses with an annual income of CA$20 million and less than 500 employees. Below are some of the services this app renders:
- Individual income tax
- Corporation income tax
- Goods and Services Tax /Harmonized Sales Tax (GST/HST)
- GST/HST return
- T2 corporation income tax return
- T4 information return
- T5013 partnership information return
- income tax and benefit return
You can make all your online payment using a credit or debit card. The CRA allows payments through third-party service providers but doesn’t accept credit card payments directly. Your payment might take up to 3 -5 day working days for processing, so it is advisable to pay before the due date to avoid penalties.
Note that if you file your income tax return late, you will be charged a 5% penalty on the amount due. You’ll be charged an extra 1% penalty for each month the return is delayed, up to a maximum of 12 months. In total, you will face a penalty of 17% on the balance due on your return. Payments that are late or inadequate are often subject to penalties.
Listed above are the primary online payment methods initiated by the Canada Revenue Agency for safe and secure payments. These online channels are available to both residents and non-residents of Canada.
You can contact the CRA help desk for any inquiries, and you will be connected to a customer care rep that will put you through the steps. Only make transactions through approved financial intuitions. Payment through a third-party service may charge up to 2%.
Do not fall for scams and lose your money. It is advisable to make advance payments because it can take up to 3 to 5 days for the CRA to process your payment, this will help you avoid penalties or extra charges.