CRA Quarterly Tax Instalments Calculator

CRA requires instalments if your net tax owing exceeds $3,000 ($1,800 for Quebec residents) in the current year AND in either of the two previous years. Both conditions must be met under ITA s.156.1. The rule applies to individuals — corporations have a separate instalment regime under ITA Part I. If you fail the first condition in any year, the requirement lifts for that year even if prior years exceeded the threshold.

The no-calculation option is the amount the CRA works out for you from your latest assessed return and prints on your instalment reminder (Form INNS1). It suits you if your income, deductions and credits stay about the same from year to year. The prior-year option suits you if your 2026 position will be similar to 2025 but quite different from 2024. Choose the current-year option only if you have a confident estimate that's materially lower than the reminder — be conservative, because under-estimating triggers interest on the shortfall.

CRA charges instalment interest at the prescribed overdue rate, compounded daily from each missed due date until payment. CRA resets that rate every calendar quarter; it has been 7% in every quarter from Q3 2025 through Q4 2026, the most recent CRA has published. The interest is calculated on each missed instalment separately. The CRA applies an instalment penalty only if the year's instalment interest is more than $1,000: the penalty is half of the interest above the higher of $1,000 and 25% of the interest you would have owed had you made no instalments (ITA s.163.1). Interest and penalties payable under the Act are not deductible (ITA s.18(1)(t)).

March 15, June 15, September 15, and December 15. If a due date falls on a Saturday, Sunday or CRA-recognized public holiday, the payment is considered on time if the CRA receives it on the next business day. Farmers and fishers whose main income is from farming or fishing have a single instalment due date, December 31.

Yes. The CRA charges instalment interest on each instalment you should have paid, from its due date to your balance due date, using the payment option that gives the least interest, and then subtracts the interest on each instalment you did pay, from the date you paid it (or January 1 if later). So a late or larger payment stops interest from running on the shortfall from the date it is made. Interest compounds daily at the prescribed rate.

Yes. For Quebec residents the CRA's threshold is net tax owing of more than $1,800 (instead of $3,000) in the current year and in either of the two previous years. This calculator applies the CRA rule; Quebec provincial instalments are administered by Revenu Québec, so check its rules separately.

You can pay online, in person, or by mail. For in-person or mailed payments, use your instalment remittance voucher (Form INNS3), which comes with your instalment reminder package unless you pay by pre-authorized debit; you can also download one in your CRA account. The CRA does not send a receipt right away: allow 3 business days for online payments and 10 business days for cheques or money orders before checking that the payment shows under “Accounts and payments” in your CRA account, and keep proof until the payment is applied or you receive your instalment payment summary (Form INNS2) in February.

Usually no. The instalment requirement needs both current-year net tax owing AND prior-year (or two-years-prior) net tax owing to exceed $3,000. In your first year of self-employment, your prior-year tax owing was likely zero (or below threshold from employment-only income), so the prior-year condition fails — even if your current-year tax owing will be substantial. You pay the full first-year liability by the April 30 balance due date without instalments. The second year is when instalments typically kick in.

Switch to the current-year option and pay 1/4 of your estimated current-year tax each quarter. CRA cannot charge interest if your current-year actual tax owing turns out to be at or below your estimate. The risk is under-estimating — if actual exceeds estimate, interest accrues on the shortfall from each missed due date. Track year-to-date income and adjust your remaining instalments if your projection changes.

Instalments themselves are not deductible — they're prepayments of your annual income tax liability. The tax you ultimately pay (after netting instalments at year-end) is reported on your T1 return as your income tax for the year. Instalment interest and the s.163.1 penalty are similarly non-deductible from business or rental income, as is any other interest or penalty payable under the Income Tax Act (ITA s.18(1)(t)).