When Do Self-Employed Canadians Need to Make Quarterly Tax Installments?

If you're self-employed in Canada, you may be required to pay quarterly tax installments to the CRA if your net tax owing is expected to exceed a certain threshold. In 2026, you must make quarterly installments if your total tax payable (before considering credits) is more than $3,000 for the current year or either of the two preceding years. These payments are due on March 15, June 15, September 15, and December 15 each year, and failure to pay on time can trigger interest charges and penalties starting at 10% of the amount owing. Understanding quarterly installments is crucial for self-employed workers because the CRA expects you to pay tax throughout the year, not just at filing time. Unlike employees who have tax withheld from paychecks, self-employed individuals bear full responsibility for tracking their tax liability and making timely payments. Not every self-employed person pays installments.

Frequently Asked Questions

Do I have to pay quarterly installments if I'm self-employed?

Only if your total tax payable exceeds $3,000 in the current year or either of the two preceding years. If you're unsure, check your most recent notice of assessment or contact the CRA. Many self-employed individuals with modest incomes don't meet this threshold.

What happens if I miss an installment payment date?

You'll owe interest (currently 7-9% annually) plus a 10% penalty on the shortfall between what you paid and what you should have paid. These charges compound daily, so it's important to catch up as soon as possible.

Can I change my installment amount if my income drops?

Yes, you can request a reduction by contacting the CRA and explaining your changed circumstances. However, you'll still owe interest on any final shortfall when you file your tax return, so it's best to estimate conservatively.

Which installment calculation method should I use?

Use whichever of the three CRA methods (current year estimate, prior year amount, or two-year average) results in the lowest payment. If your income fluctuates, the current year method is typically more accurate, though it requires honest forecasting.

Can I pay my quarterly installments early?

Yes, paying early is encouraged and can help reduce interest charges. You can pay anytime before the due date through online banking, CRA My Account, or automated phone service.

Steps

1. Determine if you must pay installments: Check your most recent notice of assessment to see if your net tax owing exceeded $3,000. If yes, or if the CRA has notified you, you're likely required to pay. Use the [Self-Employed Tax Estimator](/tools/self-employed-estimator) to confirm your 2026 liability.
2. Choose a calculation method: Select the lowest of three CRA methods: 25% of your current year estimate, the same amount as last year's installments, or 25% of your average tax owing from the past two years. Calculate each option and use the smallest result.
3. Set up payment reminders: Mark the four due dates on your calendar: March 15, June 15, September 15, and December 15. Set reminders one week before each date to allow time for payment processing.
4. Register for CRA My Account: Visit [CRA My Account](https://www.canada.ca/taxes/individuals/services/account) to set up online access. This allows you to view installment amounts, track payments, and submit payments securely from home.
5. Make your first quarterly payment: Log into your bank's online platform or CRA My Account and initiate a payment to the CRA for the full installment amount due on March 15. Keep a copy of the payment confirmation for your records.
6. Review and adjust as needed: After each quarter, compare your actual income to your estimate. If you're earning significantly more or less, contact the CRA to request an adjustment to future installments to avoid overpaying or underpaying.