top-Accountant_edited.png

Corporate Tax Return Preparation (T2)

bg-services.png
Accountant_edited.jpg

Corporate Taxes & Accounting Services

Corporate Tax Return Preparation (T2)

Every business in Canada must file the T2 tax return within six months following the end of each taxation year. All resident or non-resident corporations must file a corporation income tax (T2) return every tax year, even if no tax is due. This includes the following:

  • Organizations that are not for profit

  • Corporations that are not subject to taxes

  • Inactive corporations (no income)

The T2 is Canada's obligatory corporate income tax return form. This statement is known as a "declaration of corporate revenue." Each taxation year, each business or firm must file a corporate income tax (T2). The Canada Revenue Agency has two types of T2 statements that companies can use. The T2 Corporation Income Tax Return is a nine-page return that any corporation can use, and T2 Short Return is a two-page return plus one schedule. All businesses residing in Canada must file a T2 return with the Canada Revenue Agency. The law is stringent; all companies must comply and must be taken very seriously.

What data is required to complete a T2 tax return?

  • Name and address of the company

  • All company shareholders' names (first and last), addresses, and country of residence are obtained from the Canada Revenue Agency.

  • All authorized corporate signatory shareholders' names (first and last), addresses, and countries of residence.

  • Complete financial statements (income statements, balance sheets) submitted to the General Index of Financial Information (GIFI)

  • The company's primary activities are as follows:

  • The company's many sources of revenue (investment income, etc.)

  • Whether or not the company's stockholders own shares in other companies or are linked to or related with other businesses.

  • Whether the company conducts business or has property in another country

  • Whether or not events are held in other provinces in Canada

  • Dividends received or paid by the company

  • Fixed asset acquisition or disposal

This list is by no means complete, but it offers you a fair idea of what kind of information you'll need to file a T2 in Canada. If the company has any taxes owing, it must be paid within three months from the date of the corporate fiscal year-end. Any unpaid taxes would result in instalment interest in addition to the arrears interest.

If your company's gross income exceeds $1 million, you won't be able to file a paper tax return. Corporate tax returns must be filed electronically. Companies that fail to file their filings online face a $1,000 penalty and 1% interest on any outstanding taxes from the Canada Revenue Agency.