If the corporation has a balance owing on its corporate income tax, for most corporations, that Canadian corporate tax balance must be paid within two months after the end of the tax year.
However, Canadian-controlled-private corporations and corporations claiming the Small Business Deduction have three months to pay their corporate income tax balance:
"(Corporate) tax is due three months after the end of the tax year if the following conditions apply (T4012 - T2 Corporation - Income Tax Guide):
- the corporation is a CCPC throughout the tax year;
- the corporation is claiming the small business deduction for the tax year, or was allowed the small business deduction in the previous tax year; and either
- the corporation's taxable income for the previous tax year does not exceed its business limit for that tax year (if the corporation is not associated with any other corporation during the tax year); or
- the total of the taxable incomes of all the associated corporations for their last tax year ending in the previous calendar year does not exceed the total of their business limits for those tax years (if the corporation is associated with any other corporation during the tax year).
The maximum allowable business limit for a corporation that is not associated with any other corporation is $500,000 if the calendar year is 2009 or later.
For more information on preparing and filing corporate income tax returns, see my Corporate Tax Canada Guide.
