December 31 is coming, and it is your last chance to act on your 2026 taxes. Whether you are self-employed or own a small business in Canada, a few decisions made before the end of the year can lower your tax bill and help you avoid penalties in the spring. Here is what to check, with the amounts and dates in effect for 2026.
1. Pay your last tax instalment by December 15
If your net tax owing is more than $3,000 (or $1,800 for Québec residents), you must pay tax instalments four times a year: March 15, June 15, September 15 and December 15. This applies to most self-employed people, since no tax is withheld at source on their income. Paying the amounts suggested by the Canada Revenue Agency (and Revenu Québec in Québec) on the right dates protects you from interest and penalties, even if you end up owing more tax.
2. Make your business purchases before December 31
An expense paid or incurred in December is deducted from your 2026 income; the same expense made in January will have to wait for your 2027 return. If you plan to buy equipment, a computer, software or supplies, buying before year-end can lower your taxable income this year. Keep all your invoices: you also need them to claim back the GST/HST (and QST in Québec) you paid.
3. Bring your bookkeeping up to date
Up-to-date bookkeeping in December gives you an accurate picture of your year: your real profit, forgotten expenses and the amounts to set aside for taxes. It is also the time to reconcile your bank accounts, follow up on unpaid invoices and file the year’s receipts.
4. Check your GST/HST status
Once your taxable revenue exceeds $30,000 over four consecutive calendar quarters, you are no longer a “small supplier” and must register for the GST/HST (and the QST if you are in Québec). If you are getting close to that threshold, review your situation before year-end. If you are already registered, make sure you have claimed all your input tax credits. Our page on GST/HST, QST and PST returns explains the filing frequencies.
5. Plan your RRSP contribution (until March 1, 2027)
For 2026, the RRSP limit is $33,810, or 18% of your previous year’s earned income if that is lower, plus your unused room. You have until March 1, 2027 to contribute and deduct the amount on your 2026 return. For a self-employed person whose income was high this year, it is one of the simplest ways to reduce taxes.
6. Make the most of your TFSA
The annual TFSA limit is $7,000 for 2026, and unused room from previous years carries forward. Contributions are not deductible, but investment income and withdrawals are tax-free. If you plan to withdraw money from your TFSA, do it before December 31: the amount withdrawn becomes available again on January 1.
7. If you are incorporated: salary, dividends and year-end
For corporation owners, year-end is the time to decide how to pay yourself: salary, dividends or a mix of both. The choice affects your personal tax, your CPP contributions (QPP in Québec) and your RRSP room. Reminder: the corporate income tax return (T2, plus the CO-17 in Québec) must be filed within six months of the end of the fiscal year. Good news for planning: the increase to the capital gains inclusion rate that was scheduled for 2026 was cancelled; the rate remains 50%.
8. Note the spring 2027 deadlines
- March 1, 2027: last day to contribute to your RRSP and deduct the contribution for 2026.
- April 30, 2027: filing deadline for personal tax returns and payment of any balance owing, including for the self-employed.
- June 15, 2027: filing deadline for self-employed individuals (any balance owing must still be paid by April 30).
- Six months after the end of the fiscal year: T2 corporate returns (and CO-17 in Québec).
A reminder about tax rates
The lowest federal tax rate dropped from 15% to 14% on July 1, 2025, and the 14% rate applies to all of 2026. If your instalments were calculated based on your 2025 tax, check whether they are still right.
Need help with your year-end?
LeComptable.ca has been helping self-employed professionals and small businesses since 2000, online across Canada: bookkeeping, GST/HST, payroll, tax returns and tax planning. Our monthly packages start at $150 and the first 15-minute consultation is free. Book an appointment or call us at 514-270-0500.
This article provides general information current as of October 2026. It does not replace advice tailored to your situation. Amounts are based on announcements by the Canada Revenue Agency and Revenu Québec.
