Calculating instalments of Parts I, VI, VI.1, and XIII.1 tax, and provincial and territorial tax

There are three options you can use to calculate the least amount of tax you have to pay in instalments for the current tax year, based on:

• the current year;
• the previous year; or
• a combination of the previous year and the year before the previous year.

For all three options, you base the calculation on the total tax you have to pay under Parts I, VI, VI.1, and XIII.1 of the Income Tax Act, and the tax you have to pay to provinces and territories (other than Quebec and Alberta).

Unlike other provinces and the territories, Quebec and Alberta administer and collect their own corporation taxes. Corporations that earned taxable income in these provinces pay provincial tax directly to those provinces.

Refundable and non-refundable, federal, provincial, and territorial tax credits are included in the calculation of instalment payments. Use the estimated refundable and non-refundable credits (as appropriate) for the current year to calculate your instalment payments under the three options.

We will assess your return using the option that results in the least amount payable by instalments. We will charge interest if you use option 1 and your estimated tax was lower than the year's actual tax and the tax calculated using option 2 or 3.

Corporations generally make monthly instalment payments or quarterly instalment payments towards their tax liability.

For more information and examples of calculations, see Worksheets.

Instalment payment calculator

You can use the "Calculate instalment payments" service to calculate instalment payments and view their due dates using:

• Represent a Client, if you are an authorized representative or employee; or
• My Business Account, if you are the business owner.

Forms and publications

• Guide T7B-CORP, Corporation Instalment Guide
• Worksheet T2WS1, Calculating estimated tax payable and tax credits for 2017
• Worksheet T2WS2, Calculating monthly instalment payments for 2017
• Worksheet T2WS3, Calculating quarterly instalment payments for 2017

Related topics

• Rules for special situations
• When you do not have to pay instalments

Date modified:

2017-02-07