Recently the Canada Revenue Agency (CRA) announced the prescribed annual interest rates that will be effective from January 1, 2019 to March 31, 2019. These interest rates will apply to any amounts owed to the CRA and to any amounts owed by the agency to individuals and corporations.
The prescribed annual interest rates for the 1st quarter for 2019 are as follows:
- 6% interest rate charged by the CRA on overdue taxes, CPP contributions, and EI premiums.
- 2% interest rate paid by the CRA on overpayments to corporations.
- 4% interest rate paid on overpayments to non-corporations.
- 2% interest rate to calculate taxable benefits for employees and shareholders from interest‑free and low-interest loans.
- 67% interest rate for corporate taxpayers’ pertinent loans or indebtedness.
You can find the full list of interest rates on overdue and overpaid remittances here.
What does this mean for you?
The rate has been at historic lows in recent years and a 2% rate for the first quarter for 2019 is still considered to be very low based on historical standards. There are many ways you can take advantage of the low prescribed rate such as when it comes to family loans and employee loans!
Now is the time to speak to one of our team members about the interest accrued on your loans and how this will affect your tax benefit. The team at RLB is always here to help! If you have any questions or concerns, please contact your RLB Advisor at 1-866-822-9992.
References:
