The Canada Revenue Agency is now administering Ontario's corporations tax, capital tax, corporate minimum tax, and the special additional tax on life insurers. All telephone enquiries should be directed to the CRA at 1 800 959-5525 or 1 800 665-0354 for teletypewriter (TTY). More
All incorporated businesses, including those incorporated inside and outside Canada, that maintain a permanent establishment (see Interpretation Bulletin 3008 Allocation of Taxable Income and Taxable Capital) in Ontario are liable for Ontario corporate taxes.
The major components of corporations tax are income tax and capital tax. Insurance corporations pay premium tax instead of capital tax.
For information regarding the calculation of these taxes please refer to the Guide to the CT23 Corporations Tax and Annual Return.
Who Should Be Registered
All incorporated businesses, including those incorporated inside and outside Canada, that maintain a permanent establishment in Ontario are liable for Ontario corporate taxes. A permanent establishment can generally be described as a fixed place of business such as an office, farm, factory, branch, warehouse etc.
Unincorporated businesses are not required to pay Ontario corporations tax. These include sole proprietorships and businesses run by individuals as partnerships. Owners of unincorporated businesses are, however, subject to personal income tax on an individual basis.
For information about registering a new Ontario corporation or information about registering a corporation from outside Ontario, please visit the Service Ontario website.
For information about registering a federally incorporated company, please visit the Industry Canada website.
Reporting & Remitting Tax
Generally, every corporation carrying on business in Ontario through a permanent establishment must submit a CT23 Corporations Tax and Annual Return within six months of the taxation year end.
Tax payments, payable to the Minister of Finance, may be made:
- at any financial institution in Ontario where you have an account;
- electronically, using a financial institution's Internet Banking Service;
- delivery to any Ministry of Revenue tax office or by mailing to:
Ministry of Revenue
33 King St W
PO Box 620
Oshawa ON L1H 8E9
An amount paid by a corporation is deemed to be paid on the day of receipt of the payment by the Ministry or its authorized agent (i.e., a bank or other financial institution).
Except for corporations eligible for the small business instalment exemption and corporations that qualify for the quarterly instalment option, all corporations are required to make monthly instalment payments. Corporations, other than amalgamated corporations, filing for the first time do not have a tax payable for a preceding taxation year and are therefore not required to make instalment payments. Corporations may calculate their tax instalments in one of three ways, choosing the most favourable option:
- 1/12th of the current taxation year's estimated tax, or
- 1/12th of the previous taxation year's tax, or
- for the first two months, 1/12th of the tax payable two years ago; and for the next 10 months, 1/10th of the difference between the previous taxation year's tax payable and the amount paid for the first two months.
For taxation years commencing after December 31, 2001, corporations with tax payable for the current or immediately preceding taxation year between $2,000 and $10,000 are allowed to calculate and pay their instalments on a quarterly basis.
Corporations with tax payable less than $2,000 for the taxation year or the preceding year may be exempt from paying instalments. For further information please see Information Bulletin 4007 "Tax Instalments".
Single administration of Ontario corporation tax
For tax years ending in 2009 or later, corporations that have a permanent establishment in Ontario will need to file a harmonized T2 Corporation Income Tax Return with the Canada Revenue Agency (CRA). The harmonized return will include the following Ontario corporation taxes: corporate income tax, including refundable tax credits, corporate minimum tax, capital tax, and special additional tax on life insurance corporations. More
