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Last updated: September 20 2016
October to December: Prescribed Interest Rates Unchanged
The Canada Revenue Agency has announced the final prescribed interest rates that will apply to any amounts owed to the CRA and to any amounts the CRA owes to individuals and corporations in 2016.
These rates are calculated quarterly and will be in effect from October 1, 2016 to December 31, 2016 and there has been only been one change.
Income Tax Rates: Staying the same:
- 5% - that’s the interest rate charged on overdue taxes, Canada Pension Plan contributions, and Employment Insurance Premiums.
- 3% - this is the interest rate CRA pays taxpayers on their overpayments to the department.
- 1% - this is the interest rate used to calculate taxable benefits for employees and shareholders from interest-free and low-interest loans. It’s also the rate used for inter-spousal investment loans and the interest rate paid by CRA on corporate taxpayer overpayments.
Changing: 4.49 % - this is the new interest rate for corporate taxpayer’s pertinent loans or indebtedness.
Other taxes duties or charges: overdue refers to amounts owed by taxpayers; overpaid remittances are subject to the interest rates CRA will pay (2% less).
| Overdue remittances | Overpaid remittances – Corporate taxpayers | Overpaid remittances – Non-corporate taxpayers | |
|---|---|---|---|
| Goods and services tax (GST) | 5% | 1% | 3% |
| Harmonized sales tax (HST) | 5% | 1% | 3% |
| Air travellers security charge | 5% | 1% | 3% |
| Excise tax (non-GST/HST) | 5% | 1% | 3% |
| Excise duty except brewer licensees (amounts due after June 30, 2003) | 5% | 1% | 3% |
| Excise duty except brewer licensees (amounts due before July 1, 2003) | 3% | N/A | N/A |
| Excise duty (brewer licensees) | 3% | N/A | N/A |
| Softwood lumber products export charge | 5% | 1% | 3% |
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