Getting Your Business Number (BN)
When you start a business in Canada, you need a single federal identity. The Canada Revenue Agency calls this your Business Number. It is a standard nine-digit number that stays with your enterprise forever. Think of it like a Social Insurance Number but for your company.
Your Business Number acts as the main door to your corporate tax filings. The CRA uses this number to track your corporate income, your sales tax collections, and your employee payroll activities. You can register for one online through the government portal or ask a professional to open it for you.
- A Business Number is totally mandatory for corporations.
- Sole proprietors need one if they register for specific tax programs.
- It connects all your different tax accounts together in one main folder.
- You will use it on all official government applications and forms.
The GST Registration Threshold ($30,000)
Many new business owners think they can ignore the Goods and Services Tax when they first start. In Canada, you must register for a GST account the exact moment your total taxable sales cross **$30,000** within any single calendar quarter or four consecutive quarters in a row.
If you cross this mark and forget to register, the CRA will calculate what you owe based on your total sales anyway. That means you will have to pay the tax out of your own pocket. To ensure you handle provincial sales tax properly alongside federal laws, read our detailed GST/PST Filing Guide for BC Small Businesses.
Payroll Requirements If Hiring Employees
The moment you hire your very first team member, you take on new legal jobs. You cannot just write them a simple check at the end of the week. You must set up a formal payroll account with the CRA and calculate specific deductions from their pay.
Every single time you pay your staff, you must take out money for Income Tax, Canada Pension Plan (CPP), and Employment Insurance (EI). You have to keep this money safe and send it directly to the government every single month. If you want to automate this difficult process, look into our professional Payroll Services.
- You must open a payroll program account before your employee's first pay date.
- Calculate proper deductions using the CRA online calculator.
- Send the employee deductions plus your business share on time.
- File a T4 slip for every worker before the end of February each year.
Understanding Tax Remittance Deadlines
Filing a tax return is only half the battle. You also have to send the actual money you owe to the CRA. These payment dates are called remittance deadlines, and they change depending on how your business is set up and how much money you make.
| Account Type | Common Deadline | What You Send |
|---|---|---|
| GST Account | One month after the end of your reporting period | GST collected from clients minus GST paid on supplies |
| Payroll Account | The 15th day of the following month | Employee tax deductions plus employer CPP and EI shares |
| Corporate Income Tax | Two or three months after your fiscal year ends | Annual tax balance based on corporate net profits |
Missing these specific dates triggers immediate interest charges and heavy financial penalties. It is highly recommended to mark these dates on your calendar early.
Official Record-Keeping Requirements
The CRA has a very strict rule for business owners: you must be able to prove everything you claim on your returns. You cannot rely on basic bank statements or memory. You must hold onto all your primary bills, slips, and documents for a minimum of six years.
If you get audited and cannot show the proper paperwork, the government will reject your expense deductions and send you a bill for extra taxes. To make sure you keep the right files handy, review our guide on What Documents Do You Need for Corporate Tax Filing.
- Save all digital sales slips and matching client contracts.
- Keep itemized supplier bills that show exactly what you purchased.
- Keep your business vehicle logs and home office utility bills safe.
- Never throw away receipt papers just because they are entered into software.
Common CRA Mistakes That Trigger Audits
Audits are rarely completely random. The CRA uses advanced computer programs to scan tax returns for unusual patterns. Certain mistakes act as giant red flags that invite an auditor to inspect your corporate files.
The most common triggers include claiming massive vehicle deductions without a real mileage log, reporting permanent business losses year after year, or having wild changes in your total sales numbers. Mixing your personal grocery bills into your business costs is another easy way to start an audit. If you ever find yourself facing a government review, follow our steps on What to Do If CRA Sends a Notice.
Penalties and How to Appeal Them
Filing your tax forms late automatically triggers a penalty. For example, a late corporate tax return costs an immediate **5%** penalty on the balance you owe, plus an extra **1%** for every month it stays late. Payroll late fees can quickly climb as high as **10%** of the amount you forgot to send.
If you receive a penalty but have a very good reason—like a serious medical emergency or a major natural disaster—you can file an official appeal. You must submit a formal taxpayer relief request with clear proof to ask the CRA to cancel the extra fees.
Frequently Asked Questions
How long do I need to keep my business tax receipts?
You must keep all business receipts, invoices, and accounting books safe for at least six years from the end of the tax year they belong to.
What happens if I cannot pay my business taxes on time?
You should still file your tax return exactly on time to avoid the heavy late-filing penalty. Then, reach out to the CRA right away to ask for a payment plan.
Can I manage my own CRA compliance safely?
You can run basic entries yourself, but having a qualified local professional review your accounts keeps you safe from costly mistakes and sudden audits.
Ready to Secure Your CRA Compliance Infrastructure?
Protecting your company from tax penalties lets you focus completely on your daily business growth. You do not have to struggle through confusing government rules alone.
Our dedicated team provides professional CRA Compliance & Representation support to give you complete peace of mind. Get in touch with us today to keep your business operating safely.
