Tax Instalment Payments Explained
If your net tax owing exceeded $3,000 in 2024 AND in either 2023 or 2022, you likely need to make instalment payments in 2025.
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Key Takeaways
- Instalments required if you owe $3,000+ at tax time
- Quarterly payments due March, June, Sept, December 15
- Three calculation methods available
- Interest charged on missed or late instalments
Who Must Pay Instalments?
You must make instalment payments if your net tax owing exceeds $3,000 in the current year AND either of the two preceding years.
Instalment Due Dates
- March 15
- June 15
- September 15
- December 15
Calculation Methods
Current Year Method
Estimate your current year tax and divide by 4. Best if income will be lower this year.
Prior Year Method
Use last year's tax divided by 4. Simple but may result in underpayment.
CRA Suggested Method
CRA sends suggested amounts based on your history. Easiest approach.
Interest on Late Instalments
CRA charges compound daily interest on late or insufficient instalment payments.
Manage Your Instalments
Tax Punjabi can help you calculate and track instalment payments.