CRA June 15 Quarterly Instalment Payment 2026: Who Pays and How Much

If your 2025 Notice of Assessment showed more than $3,000 of federal + provincial net tax owing (or $1,800 if you live in Quebec), the CRA expects you to pay your 2026 tax bill in four quarterly instalments — not in one lump sum next April. The second of those four payments is due June 15, 2026.

This guide walks through who has to pay, the three methods CRA offers, the exact June 15 number for a typical case, and the cost of skipping the payment. If you’d rather plug numbers in directly, the CRA Quarterly Instalments Calculator runs all three methods side by side.

1. Who Actually Has to Pay Instalments

Under Income Tax Act s.156.1, CRA’s instalment rule has two prongs and you must hit both:

1. Your current-year (2026) net tax owing will exceed $3,000 — $1,800 if you live in Quebec, because Revenu Québec administers the Quebec provincial portion separately, so the federal-only threshold is lower.
2. Either your prior-year (2025) or your two-years-prior (2024) net tax owing also exceeded that threshold.

“Net tax owing” is defined in s.156.1(1) as your federal plus provincial income tax payable for the year, less the tax already withheld at source (T4 box 22, T4A box 22 and similar). The instalments you paid are not subtracted, so the balance owing on line 48500 of your T1 is not the measure; the CRA’s calculation chart for instalment payments sets it out. It is not your gross tax payable. Most salaried T4 employees whose only income is from one employer never trigger this rule because their employer’s source deductions cover them within $3,000.

Who typically does trigger it:

• Self-employed Canadians with no source deductions on their business income.
• Retirees drawing from RRIF, OAS, CPP, and unregistered investment accounts with insufficient or zero withholdings.
• High-income earners with significant investment income — non-registered dividends, taxable capital gains, foreign income — that arrives without withholding tax.
• Rental property owners whose net rental income pushes them past the threshold.
• Anyone who’s recently had a bonus, RSU vesting, or stock-option exercise that withheld at a flat rate below their marginal bracket.

If neither of (2025, 2024) cleared the threshold, you’re not required to pay instalments in 2026 even if CRA sends you a reminder; one of the two clearing it is enough to meet the second prong (s.156.1(2)(b)). The reminder is computed from prior data; the legal test is the two-prong rule above.

CRA usually sends an instalment reminder in February (for March 15 and June 15) and August (for September 15 and December 15). If you didn’t get one, you can check CRA My Account → Accounts and Payments → Instalments to confirm your required amount.

2. The Three Methods CRA Allows

CRA permits three calculation methods. You can switch methods mid-year — but the one you use must produce four payments that, in aggregate, satisfy CRA’s interest test.

The CRA’s own instalment calculator on My Account defaults to method (a). It’s printed on every paper reminder. If you pay exactly what the reminder says, on time, you can never be charged instalment interest — even if your actual 2026 tax owing turns out to be much higher. CRA’s worst case has already been computed into method (a).

3. June 15, 2026 — The Worked Example

The four 2026 instalment due dates are:

• March 15, 2026 — Q1
• June 15, 2026 — Q2
• September 15, 2026 — Q3
• December 15, 2026 — Q4

(If the 15th falls on a weekend or federal holiday, the payment is due the next business day. June 15, 2026 is a Monday, so it counts as the actual due date.)

Suppose Priya is a self-employed consultant in Ontario:

• 2024 net tax owing: $9,000
• 2025 net tax owing: $12,000
• 2026 estimated net tax owing: $13,500 (income growing)

She’s in. Both 2024 and 2025 cleared the $3,000 threshold, and her 2026 estimate clears it too.

Under each method, here’s her June 15, 2026 payment:

• (a) No-calculation: ¼ × $9,000 = $2,250 (same as her March 15 payment). Her Q3 and Q4 reminders will then split the remaining $12,000 − $4,500 = $7,500 into two payments of $3,750 each.
• (b) Prior-year option: ¼ × $12,000 = $3,000.
• (c) Current-year option: ¼ × $13,500 = $3,375.

In Priya’s case, method (a) front-loads less, but she’ll owe a larger Q3 + Q4. Method (b) is the smoothest. Method (c) pays the most early but means she won’t have a large April 30, 2027 balance owing.

Where this matters: cash-flow. Method (a) defers $1,500 of tax into the second half of the year — useful if cash is tight in June. Method (b) is what most accountants recommend by default because it’s predictable and CRA-safe.

For a customer with falling income — say, retired Bob whose 2025 had a $20,000 RRIF withdrawal he won’t repeat in 2026 — method (c) is the right call. His CRA reminder will demand quarters based on 2024, but he can elect method (c) to pay less, as long as his 2026 estimate is accurate.

The CRA Quarterly Instalments Calculator runs all three on your numbers and flags the cheapest safe option.

4. The Cost of Skipping June 15

Two things happen if you don’t pay an instalment that CRA expected:

a. Instalment interest (always)

Under ITA s.161(2), CRA charges instalment interest from the day each instalment was due, compounded daily, at the prescribed rate for overdue taxes. The prescribed rate is reset quarterly. For Q2 2026 (April–June 2026), it is approximately 7% annually for overdue balances (CRA publishes the exact rate each quarter on the Prescribed interest rates page; verify before relying on a specific number).

Interest is calculated as: (missed instalment × daily rate × days late), summed across each missed payment.

CRA offsets instalment interest with instalment credit interest if you pay more than required in a quarter or pay early. Paying Q3 early in August therefore reduces the interest on a missed June 15. The credit is not a yield: it can only be set against instalment interest for the same year and is never paid out.

b. Instalment penalty (only above $1,000)

Under ITA s.163.1, the penalty is 50% of the amount by which the year’s instalment interest exceeds the greater of two figures: $1,000, and 25% of the interest that would have been payable if no instalment had been made for the year.

Worked example: Priya skips all four 2026 instalments entirely. Her instalment interest accrues across each missed quarter and totals, say, $1,400 by April 30, 2027.

• Interest: $1,400. With no instalments made, 25% of that is $350, so $1,000 is the greater figure.
• Penalty: 50% × ($1,400 − $1,000) = $200.
• Total cost on top of her regular tax: $1,600.

If she’d only skipped June 15 alone and paid the rest on time, her interest on that one $3,000 missed payment over about 320 days at 7% compounded daily would be ≈ $184 — under the $1,000 penalty floor. So the first missed quarter is rarely catastrophic. Skipping the whole year is.

Paying a missed instalment later does not wipe the interest out: it runs from the original due date until the payment lands. The only offset is credit interest from paying a later instalment early or paying extra, and that credit cancels instalment interest for the same year, no more.

5. How to Pay

Pick whichever is easiest for your banking setup:

• CRA My Account → Proceed to pay — pay directly from your CRA login by credit card, debit, or interac.
• Online banking at any major Canadian bank — add the payee “CRA – Personal income tax instalment” (sometimes listed as “CRA Revenue – tax instalment” or “Federal — Personal Income Tax (TXINS) — 2026 Tax Year”). Use your 9-digit SIN as the account number. Do not select the generic “CRA – tax owing” payee — that posts to your balance owing, not your instalment account, and CRA’s automated instalment-interest engine won’t see it.
• Pre-authorized debit (PAD) — set up once via My Account; CRA pulls each instalment automatically on the due date. Recommended for anyone prone to forgetting dates.
• In person at any Canadian bank with the CRA-issued INNS3 remittance voucher.
• Cheque to “Receiver General for Canada” — slow and not recommended; allow at least 5 business days.

The payment date is the date CRA receives the funds, not the date you initiate. Online banking from a major Canadian bank is typically same-day or next-business-day. Don’t cut it close to June 15 from a non-Canadian bank.

6. Decision Framework: Which Method?

A 90-second triage:

1. Did CRA send you a reminder? If yes, method (a) (pay exactly the reminder amount) is the lowest-risk default. You’ll never owe instalment interest. Go to step 6.
2. Has your income been roughly flat for the last 2 years and probably will be in 2026? → Method (b) prior-year option. Predictable, CRA-safe.
3. Is 2026 income clearly going to be lower than 2025? (Retirement, sale of a one-off asset, change of role, parental leave.) → Method (c) current-year option — but only if you can defend your estimate. Track quarterly so you can true-up by December.
4. Is 2026 income clearly going to be higher than 2025? → Method (b) prior-year is still CRA-safe. You’ll have a balance owing on April 30, 2027 for the difference, but no instalment interest. Don’t choose (c) here unless you actually want to pre-pay.
5. Are you not sure? → Method (b) is the predictable middle ground. Run a check in November to see if you should top up Q4.
6. Pay on time, every quarter. Set calendar reminders 5 business days before each date.

The single biggest mistake we see: people who got their first-ever instalment reminder in February, didn’t recognize the form, and threw it away. The reminder is not a bill — it’s a notice — but CRA’s interest meter starts running on March 15 whether or not you opened the envelope.

Related Reading

• June 15 Self-Employed Filing Deadline — the companion filing deadline; instalments and the T1 deadline are two separate clocks.
• CRA Filing Deadlines 2026 — the full annual calendar of CRA deadlines, including all four instalment dates.
• CRA Quarterly Instalments Calculator — runs all three methods on your numbers and shows the cost of skipping.

FAQs

Q: I got a CRA instalment reminder but I’m pretty sure I won’t owe $3,000 this year. Can I just ignore it?

A: Yes. The reminder is computed from prior-year data; if you can demonstrate that your current-year (2026) net tax owing will be under $3,000, you can elect method (c) and pay $0. If you turn out to be wrong, CRA will charge instalment interest from each missed due date. Document your estimate so you can defend it if asked.

Q: I pay all my tax through payroll source deductions on T4 income. Why is CRA asking for instalments?

A: Either your 2025 Notice of Assessment showed more than $3,000 owing despite source deductions (most commonly: large RRSP withdrawals, vested stock options, or non-T4 income), or CRA is being safe based on a one-off year. Work out your 2025 and 2024 net tax owing the way the CRA’s instalment chart defines it (tax payable less tax withheld at source, not the line 48500 balance). A 2025 figure under $3,000 does not end the test if 2024 was over it, but if both years are at or under $3,000, or this year’s will be, you don’t have to pay. The reminder is just a notice.

Q: Can I pay all four instalments in one lump sum on March 15?

A: Yes. Paying early earns credit interest at the prescribed rate, but that credit can only be set against instalment interest charged on late or short payments in the same year and is never refunded, so prepaying in full earns nothing on its own. What it does is remove any chance of missing a quarter. Be sure to use the instalment payee, not the balance-owing payee, so the payment lands in the right CRA account.