Personal and business taxes

When you come to Canada to run a business, you have personal and corporate tax obligations. This article summarizes general information from the Canada Revenue Agency (CRA); work with a chartered accountant for your own situation.

Personal tax

• You become a tax resident when you have enough residential ties to Canada, usually from your first day living here.
• Income earned abroad before becoming a resident isn't taxed in Canada.
• The tax year is the calendar year; returns are usually due by April 30 of the next year.
• 2026 federal rates: 14% up to CAD 58,523; 20.5% to CAD 117,045; 26% to CAD 181,440; 29% to CAD 258,482; 33% above. Provincial tax is added based on where you live on December 31.

Corporate tax (federal)

Provinces add their own corporate tax with a lower and a higher rate. "Canadian-controlled" status depends on the owners' residency and status; ask an accountant when structuring the business.

Family benefits

• Canada Groceries and Essentials Benefit (formerly the GST/HST credit): apply as soon as you become a resident, without waiting for your first return.
• Canada child benefit: temporary residents may receive it from their 19th month in Canada if eligible.

Reporting obligations

• When you apply for benefits, the CRA asks you to report income earned outside Canada for up to 2 years before you became a resident (Statement of Income) to calculate your benefits; that income isn't taxed in Canada.
• People with foreign assets or income after becoming residents should ask an accountant about their reporting obligations.
• Keep valid records for every deduction.

Note The CRA warns that "tax reduction schemes" promising benefits for periods before you arrived are scams. Participants may have to repay and face penalties.