2 June 2026 STEP Roundtable Q. 6, 2026-1089191C6 - Timing of Trust Remittance under Part XII

Please note that the following document, although believed to be correct at the time of issue, may not represent the current position of the CRA.
Prenez note que ce document, bien qu'exact au moment émis, peut ne pas représenter la position actuelle de l'ARC.

Principal Issues: (i) Does the CRA agree that the deadline for remitting Part XIII tax on amounts deemed paid on March 31 by a trust to a non-resident beneficiary under subparagraph 214(3)(f) would be April 15, in accordance with the administrative guidance in Guide T4061?

(ii) If yes, is there a way to ensure that the CRA's will not assess penalties where the remittance is received by the Minister on or before the April 15 remittance deadline?

Position: (i) The administrative deadline set out in Guide T4061 for remitting the Part XIII tax should be applicable in the scenario described.

(ii) No penalties should be applied.

Reasons: (i) Consistency with past positions, including 2003-0009211E5.

(ii) No penalties should be applied when remittance is made in accordance with administrative guidance.

2026 STEP CRA Roundtable – June 2, 2026

QUESTION 6. Timing of Trust Withholding Payment Under Part XIII

Pursuant to subparagraph 214(3)(f)(i), where an amount has been made payable, but has not been paid or credited, by a trust to a non-resident beneficiary before the end of the trust’s taxation year, the amount is deemed to have been paid by the trust on the day that is 90 days after the end of the trust’s taxation year. This date corresponds to the deadline for filing the T3 Return for the taxation year of the trust in which the amount became payable. Pursuant to subsection 215(1), Part XIII tax shall be forthwith remitted from the date on which the amount is deemed to have been paid or credited, provided the amount was not paid at an earlier time.

Assuming that the trust has a December 31 year-end, does the CRA agree that, in the scenario described, the remittance deadline would be April 15 of the following year, in accordance with the administrative guidance in Guide T4061 NR4 – Non-Resident Tax Withholding, Remitting, and Reporting?

Assuming that the CRA agrees, is there a way to ensure that the CRA will not assess penalties where the remittance is received by the Minister on or before the April 15 remittance deadline?

CRA Response

Paragraph 214(3)(f) determines when income from a trust is deemed to have been paid or credited to a non-resident beneficiary for the purposes of Part XIII. The relevant time is the earliest of the times set out in clauses 214(3)(f)(i)(A) to (C). In the situation described, the amount was not paid or credited, and subparagraph 128.1(4)(a)(i) did not apply to the trust’s taxation year. Accordingly, the relevant time is the day that is 90 days after the end of the trust’s taxation year, which in this case is March 31.

Based on the above hypothetical facts, Part XIII tax should, under subsection 215(1), be withheld on March 31 and forthwith remitted to the Receiver General. Pursuant to the administrative policy set out in Guide T4061 NR4 – Non-Resident Tax Withholding, Remitting, and Reporting, if the remitted tax is received by the Receiver General on or before the 15th day of the month following the month in which the amount was paid or credited to the non-resident (April 15 in this case), the remittance will be considered to comply with subsection 215(1). In those circumstances, the CRA would not apply the penalty and interest provisions in subsections 227(9) and 227(9.2).

François Fournier-Gendron
2026-108919