March 21, 2025 Government Announcement re: GST/HST and Corporate Tax Relief for Businesses
Canada Revenue Agency (CRA) is implementing relief from GST/HST and corporate tax remittances for approximately 3 months.
According to the government’s announcement businesses can “[d]efer corporate income tax payments and GST/HST remittances from April 2 to June 30, 2025, providing up to $40 billion in liquidity to businesses…”
Quoting CRA, to support businesses, the Canada Revenue Agency (CRA) will:
- Defer GST/HST remittances and corporate income tax payments from April 2 to June 30, 2025
- Waive interest on GST/HST and T2 instalment and arrears payments that are required to be paid between April 2 and June 30, 2025
- Provide interest relief on existing GST/HST and T2 balances between April 2 and June 30, 2025
You do not need to provide proof of hardship from or impact of tariffs. The CRA will automatically grant relief on your T2 and GST/HST accounts during the relief period.
Note: Interest will resume starting July 1, 2025. Businesses must continue to file as normal.
What Happens After?
According to the government’s announcement businesses can “[d]efer corporate income tax payments and GST/HST remittances from April 2 to June 30, 2025, providing up to $40 billion in liquidity to businesses…”
The reference to “providing up to $40 billion in liquidity” suggests the deferred tax payments can be used for business operations. Is that correct?
This policy makes sense if “defer” means never remitting the tax. But “defer” means to postpone or delay.
If CRA is allowing businesses to defer remittance are they expecting the businesses to put these amounts aside during that time? It appears not.
Presumably, businesses will be expected to remit the deferred GST/HST and income tax after the deferral periods. For the businesses that have deferred, “providing up to $40 billion in liquidity,” won’t some have trouble remitting the deferred amounts?
How will CRA collections respond to amounts owing once the relief period ends?
SpenceDrake Tax Law – Tax Lawyers
Disclaimer
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