The governments of Canada and Ontario signed a Memorandum of Agreement on October 6, 2006, that will lead to the Canada Revenue Agency (CRA) administering certain Ontario corporate taxes.
Why are we making this change?
Ontario businesses will benefit from one form, one set of rules, one audit and one appeals process.
What does this mean for businesses?
Corporate taxpayers will start:
- making blended instalment payments to the CRA in February 2008;
- seeing compliance cost savings starting in April 2008, from integrated audits, objections, appeals and rulings for pre-2009 taxation years;
- filing a single T2 Corporate Tax return (including the Ontario annual information return) with the CRA for taxation years ending after December 31, 2008.
The CRA will assume some responsibilities for taxation years ending before December 31, 2008 as a means of providing early compliance gains to business.
For now the Ontario Ministry of Finance continues to be your first point of contact for all matters related to your Ontario corporate tax account.
Beginning with the 2009 taxation year, the CRA will administer the following corporate taxes on behalf of Ontario:
- Corporate income tax
- Corporate minimum tax
- Capital tax
- Special additional tax on life insurers
Ontario will continue to administer:
- Mining tax
- Insurance premiums tax
- Electricity Act payments-in-lieu of federal and Ontario corporate taxes
For tax years ending in 2009 or later, corporations that have a permanent establishment in Ontario will file a harmonized T2 Corporation Income Tax Return with the Canada Revenue Agency (CRA). The harmonized return will include the following Ontario corporation taxes: corporate income tax, including refundable tax credits, corporate minimum tax, capital tax, and special additional tax on life insurance corporations.
If a corporation's fluctuating fiscal period ends in January 2009 and it does not have a tax year ending in 2008, send your instalments and payments for the Ontario corporations tax to the Ontario Ministry of Finance for that fluctuating fiscal period. File a CT23 Corporations Tax and Annual Return or a Corporations Tax Return CT8 with the Ontario Ministry of Finance for that same fluctuating fiscal period.
Learn more
- Information Pamphlet: Single Administration of Ontario Corporate Tax
January 2008 - Frequently Asked Questions
- Joint Canada Revenue Agency/Ontario presentation on the Single Administration of Corporate Tax
- News: Human Resources Agreement Reached for Harmonization of Ontario Corporations Tax With Federal Regime
July 31, 2007
About the Legislation - Bill 174
- News: Ontario Businesses Will Benefit From Transformation to a Single Tax Collector
May 31, 2007 - News: McGuinty government introduces bill that will transform corporate income tax system
December 13, 2006 - Bill 174: An Act to enact the Taxation Act, 2007 and make complementary and other amendments to other Acts
Memorandum of Agreement
- News: Ontario Businesses Will Benefit From New Tax Collection Agreement
October 6, 2006 - Memorandum of Agreement Concerning a Single Administration of Ontario Corporate Tax
October 6, 2006
