Comments on: Making Tax Installment Payments

By: The Rat

The Rat — Sat, 03 Oct 2009 06:01:00 +0000

nice post

By: Samson Smith

Samson Smith — Mon, 28 Sep 2009 10:17:04 +0000

Great post, as i am having some less knowledge about this, so your post will help me a lot.

By: Canada Deals

Canada Deals — Wed, 23 Sep 2009 21:40:14 +0000

Thanks for this valuable info. I’d also like to see a post on collecting GST and the criteria for small businesses.

Note: IMO taking care of the admin stuff is one of the most challenging aspects of owning your own biz.

By: Ramona

Ramona — Wed, 23 Sep 2009 20:29:31 +0000

@zud – Yep, CPP is included in the instalments, since it forms a part of the tax liability. And my earlier post should have said Sept 15 for a full year payment, not the 30th.

By: zud

zud — Wed, 23 Sep 2009 19:50:00 +0000

Do you know if CPP is also paid by installments?

In my first year of self employment I totally forgot about CPP and had to scramble to pay it. Be ye not so silly.

By: Ramona

Ramona — Wed, 23 Sep 2009 19:05:41 +0000

@DG – the four instalment payments are one of the options you can use to pay your taxes. If you just wanted to make one payment, you’d have to make the whole year’s payment around Sept 30 – one quarter would be late, but one would be early, thus the interest would offset.

By: Aluminum Case

Aluminum Case — Wed, 23 Sep 2009 18:23:00 +0000

I was not even aware of the interest being charged for not making installment payments. I figured that since my side income had decreased I didn’t need to bother making installment payments. I will have to look into this further to see if I am getting gouged by not making installment payments. Installment payments can be a good idea when you might not be able to suddenly pay a big tax bill.

By: FrugalTrader

FrugalTrader — Wed, 23 Sep 2009 17:02:44 +0000

Thanks for the correction guys, I have fixed the article.

By: Carmen

Carmen — Wed, 23 Sep 2009 15:43:07 +0000

wow thats’ a lot of info to take in. Since i am starting my own business, this will be most helpful. Thaks!

By: OY

OY — Wed, 23 Sep 2009 14:45:00 +0000

Good Post. Interesting topic to discuss what can be tax deductible for small home based corporation, and how to do it. For example – mortgage interest, maintenance etc.

By: No Debt Guy

No Debt Guy — Wed, 23 Sep 2009 14:17:49 +0000

I am in the same boat as Four Pillars. Having your employer increase the withholding tax is a good idea. Personally I would like to be sending them a cheque for $2999 every April rather than seeing a refund.

By: DG

DG — Wed, 23 Sep 2009 13:34:46 +0000

Thanks for the article… very relevant for me as this is my first year of self employment.

I’ve heard rumors that if you voluntarily make an early installment, say in November, you can avoid being put onto the quarterly plan. Anybody know if there is truth to this?

By: Four Pillars

Four Pillars — Wed, 23 Sep 2009 13:11:11 +0000

Your criteria isn’t correct – owing more than $3k doesn’t mean you have to do installments. The rule is owing more than $3k in taxes in the current year AND one of the previous 2 years.

If you have a regular job as well then you can ask your employer to increase your tax withholding to an appropriate amount. This is what I do – I find it a lot easier than quarterly installments.

By: Ramona

Ramona — Wed, 23 Sep 2009 12:44:51 +0000

Great FT! – also note no instalments calculated and requested until your tax liability has been greater than $3000 for the last 2 tax years. This is important for an entrepreneur to keep in mind for cash flow. It takes discipline to earmark all that tax money! As you say, best to be prepared.