The Canada Revenue Agency (CRA) today announced the prescribed annual interest rates that will apply to any amounts owed to the CRA and to any amounts the CRA owes to individuals and corporations.

Read: CRA answers taxpayer questions: STEP

These rates are calculated quarterly in accordance with applicable legislation and will be in effect from July 1, 2013 to September 30, 2013. There have been no changes to the prescribed interest rates since last quarter.

Income tax

  • The interest rate charged on overdue taxes, Canada Pension Plan contributions, and Employment Insurance premiums will be 5%.
  • The interest rate to be paid on corporate taxpayers overpayments will be 1%.
  • The interest rate to be paid on non-corporate taxpayers overpayments will be 3%.
  • The interest rate used to calculate taxable benefits for employees and shareholders from interest-free and low-interest loans will be 1%.

Other taxes, duties, or charges

The interest rates on overdue and overpaid remittances are as follows:

  • Goods and Services Tax (GST)
    • Overdue remittances: 5%
    • Overpaid remittances – Corporate taxpayers: 1%
    • Overpaid remittances – Non-corporate taxpayers: 3%
  • Harmonized Sales Tax (HST)
    • Overdue remittances: 5%
    • Overpaid remittances – Corporate taxpayers: 1%
    • Overpaid remittances – Non-corporate taxpayers: 3%

Also read:

Case study: Incorporated client faces higher taxes

“Don’t go to jail for your clients”: STEP