Updated Checked by the Tax-Services.ca editorial team How we check
Bookkeeping compliance in Canada comes down to four habits: keep your records for six years, register for and file GST/HST when you pass $30,000, remit payroll on time, and file your income tax return by the deadline. Miss the payroll one and the CRA’s penalty runs from 3% to 10% of the amount.
How long do you have to keep bookkeeping records?
Six years from the end of the last tax year they relate to. That’s the CRA’s rule, set out in its circular on books and records, and you need the CRA’s permission to destroy anything sooner. Records means ledgers, journals, financial statements, returns and the paperwork behind them: invoices, receipts, bank statements.
Where you keep them counts. The CRA says records should be at your Canadian home or business, and storage with a third party needs its permission. If your books live in an online tool, read the CRA’s page on keeping records or ask your accountant how it applies. We couldn’t settle that from one page, so don’t take our word for it.
When must you register for GST/HST?
Once your taxable sales pass $30,000 in a single quarter or across four quarters in a row. You then have 29 days to register. Some businesses, taxi and rideshare drivers among them, must register whatever they earn. You can also register voluntarily under the limit.
After that, bookkeeping has to track tax on both sides: what you charged and what you paid. On a $2,500 invoice, the GST/HST calculator gives $325.00 of HST at Ontario’s 13%, and $374.38 of GST and QST together in Quebec. If your books show a different number, find out why.
Returns fall due one month after the end of a monthly or quarterly reporting period. Annual filers get three months after the fiscal year end. The CRA assigns your period, and you can only ask for a more frequent one.
What does the CRA expect on payroll?
Employers must take the deductions from pay and send them in, together with their own share of CPP and EI. Your due dates depend on your remitter type, which the CRA sets from your past payroll size, so check the letter or the My Business Account before you plan. The CRA’s when-to-remit page lists each schedule.
Here’s what one employee costs. An Ontario employee paid $4,166.67 a month has $821.26 held back and $325.65 of employer CPP and EI added, so about $1,146.90 goes in that month, per the payroll remittance calculator. Late by one to three days, and the penalty is 3%. More than seven days, or nothing sent, is 10%. Failing to deduct at all brings a 10% penalty on what should’ve been taken, and you’re on the hook for both shares.
T4 slips go out to employees and to the CRA by the end of February. The payroll deductions calculator shows what each pay stub should carry, and a long list of small mismatches there is usually the first sign that something is set up wrong.
Which income tax dates matter to your bookkeeping?
| Who | Filing | Payment |
|---|---|---|
| Self-employed individual, December 31 year end | June 15 | April 30 |
| Corporation | Six months after year end | Check the CRA page for your case |
| Employer, T4 slips | End of February | Not applicable |
| GST/HST, monthly or quarterly | One month after the period | Same day as the return |
Weekend dates shift to the next business day, so look up the exact calendar day each year. The CRA also publishes yearly deadline pages. Annual GST/HST filers with net tax of $3,000 or more in each year may owe instalments too. The self-employed tax calculator estimates the bill so you can set money aside, though it leaves out GST/HST and EI.
Corporations can get a rough tax figure from the corporate tax calculator. It ignores phase-outs and associated companies, so it’s a planning number and not a filing number.
What does a late payroll remittance cost?
The CRA scales the penalty by how late the payment is. On the $1,146.90 monthly remittance from the Ontario employee example above, the penalty works out like this before interest.
| How late | CRA penalty | On $1,146.90 |
|---|---|---|
| 1 to 3 days late | 3% | $34.41 |
| 4 to 5 days late | 5% | $57.34 |
| 6 to 7 days late | 7% | $80.28 |
| More than 7 days late, or not sent | 10% | $114.69 |
The CRA also lists 20% for a second or later assessment in the same calendar year when the failures were knowing or grossly negligent. Penalties generally apply when the amount is over $500, and interest runs from the due date at a rate set each quarter, compounded daily. A ten minute payroll check every pay period costs far less than any of these lines, and our guide to bookkeeping packages shows how to confirm who owns that task.
What does a simple monthly routine look like?
Compliance gets easier when it’s boring. Pick one afternoon a month, ideally the same one. Reconcile the bank account, file the receipts, check that sales tax collected matches the total on your invoices, and look at the next three due dates. If you pay staff, confirm the last remittance cleared.
Take Amara, who runs a small cleaning business in Edmonton with two part-time workers. Every second Friday she does a ten-minute payroll check and on the last Friday of the month she does the books. She isn’t a bookkeeper by training, and she hasn’t missed a date in three years. A routine beats a talent for numbers.
Can you do all this without hiring anyone? For a one-person business, usually yes. Once you have staff, several sales tax periods or a corporation, a bookkeeper or accountant saves real time. Either way, the legal duty stays with you.
What mistakes cause the most trouble?
Mixing personal and business money, for one. It makes every review harder, and the CRA may ask you to justify each item. Then there’s guessing at tax you charged, instead of tracking it. Late payroll payments hurt the most because they carry a penalty right away.
Some owners also throw out receipts after a year or two, assuming the bank record is enough. It isn’t. The rule says six years, and a bank line rarely shows what was bought.
Ask a bookkeeper or accountant who tracks each deadline. Don’t assume they do unless the scope says so in writing.
The sources behind this page
Record keeping comes from the CRA pages on where to keep your records and circular IC78-10. The registration threshold comes from when to register for and charge the GST/HST, reporting periods from guide RC4022, and payroll penalties from the CRA page on when to remit. We read these in November 2026. Payroll and sales tax examples come from our calculators with 2026 rates. Quebec and other provincial rules are not covered.
Frequently asked questions
How long must a Canadian business keep its books?
Six years from the end of the last tax year the records relate to, unless the CRA gives written permission to destroy them earlier. Records are kept at your place of business or home in Canada. Some records, such as those for long-term property, must be kept longer, and the CRA may ask you to keep invoices longer than six years.
What is the penalty for late payroll remittances?
The CRA lists 3% for 1 to 3 days late, 5% for 4 to 5 days, 7% for 6 to 7 days and 10% for more than 7 days or no payment. A second or later assessment in the same year can be 20% if the failures were knowing or grossly negligent. Interest is added from the due date.
How often do I file GST/HST?
It depends on your annual taxable supplies. At $1.5 million or less you file annually, with the option to file quarterly or monthly. Above $1.5 million and up to $6 million it is quarterly, and above $6 million monthly. Monthly and quarterly returns are due one month after the period ends, and annual returns generally three months after year end.
Are Quebec rules the same?
Not entirely. Quebec has its own sales tax and payroll registrations with Revenu Quebec, and its provincial rules sit outside the CRA pages we read. If you employ people or sell in Quebec, check the Revenu Quebec site as well as the CRA, and ask your bookkeeper or accountant who tracks each deadline.
When do I have to register for GST/HST?
When your taxable sales pass $30,000 in a single calendar quarter or over four consecutive quarters. If a single quarter takes you over, tax applies from the sale that crossed the line and you have 29 days to register. If you cross it gradually, small supplier status ends at the end of the month after the quarter.
- Self-employed taxes in Canada: income, CPP and GST
How tax works when you are self-employed in Canada: reporting income and expenses, paying both halves of CPP, instalments and when to register for GST