T2 Corporate Tax Return in Canada
A T2 corporate income tax return reports a corporation's income to the Canada Revenue Agency. Most resident corporations, including inactive and non-profit corporations, must file annually within six months of their tax year end. Exceptions include registered charities throughout the year, tax-exempt Crown corporations and Hutterite colonies. Accountants Online prepares T2 returns, financial statements and GIFI schedules online for corporations across Canada.
Written by the Accountants Online Tax Team · Last reviewed: September 11, 2026 · Tax year: 2026
Who must file a T2 return
Resident corporations generally file a T2 each tax year, even without income or activity. Exceptions are tax-exempt Crown corporations, Hutterite colonies and corporations registered as charities throughout the year. Eligibility for the T2 Short Return has separate conditions. Non-resident corporations may need to file when carrying on business in Canada, realizing a taxable capital gain or disposing of taxable Canadian property, subject to CRA exceptions.
If your business is incorporated federally or provincially, a T2 is required every year regardless of activity.
When is a T2 return due
The T2 filing deadline is six months after the corporation's tax year end. The income tax balance is generally due after two months. A three-month balance-due date applies to a corporation that was a CCPC throughout the year, claimed the small business deduction in the current or previous year, and meets the CRA's previous-year taxable-income and business-limit tests, including the associated-corporation rules. Instalments may also be required before year end.
T2 late filing penalties
The standard late T2 filing penalty is 5% of unpaid tax plus 1% for each complete month late, up to 12 months. The higher repeat penalty of 10% plus 2% per complete month, up to 20 months, requires a CRA demand to file and a late-filing penalty in one of the previous three tax years. Special penalties can apply to large or non-resident corporations. Interest also accrues on unpaid balances.
How online T2 preparation works
Accountants Online prepares and files T2 returns entirely online:
- Free consultation — we review your corporation and give a flat-rate quote in writing.
- You upload financial records through a secure client portal — no office visit.
- We prepare the financial statements, GIFI schedules and the T2 return.
- You review the draft; we e-file through the CRA's Corporation Internet Filing service and store the filed return in your portal.
Documents required for a T2 return
- Articles of incorporation and share structure
- Income statement and balance sheet for the fiscal year
- General ledger and bank statements
- Asset purchase invoices for capital cost allowance (CCA) claims
- Payroll records and any T5 slips filed for shareholder dividends
- Prior-year T2 return and Notice of Assessment
T1 vs T2: what's the difference
A T1 return reports an individual's personal income, while a T2 reports a corporation's income. Most owner-managed corporations require both: the T2 for the corporation, and a T1 that includes salary or dividend income drawn from it. The two returns must be consistent with each other.
Pricing
Corporate tax returns start at $500 plus tax, with a written flat-rate quote before any work begins. Final pricing depends on the state of your bookkeeping and the complexity of the corporation. Monthly bookkeeping plans start at $199 per month and keep year-end T2 preparation fast and accurate.
Common mistakes to avoid
- Assuming a dormant corporation doesn't need to file — it does, every year.
- Missing the filing deadline and the 5% + 1%/month penalty.
- Bookkeeping too incomplete to prepare accurate financial statements.
- Missing capital cost allowance claims on eligible assets.
- Failing to file T5 slips when shareholder dividends are paid.
Frequently asked questions
Who needs to file a T2 corporate tax return?
Most resident corporations, including inactive and non-profit corporations, must file annually. Exceptions include tax-exempt Crown corporations, Hutterite colonies and corporations registered as charities throughout the year. Non-resident corporations have separate filing rules for Canadian business, taxable capital gains and taxable Canadian property.
When is a T2 return due?
The return is due six months after the tax year end. Payment is generally due after two months; qualifying CCPCs have three months if the small business deduction and previous-year income/business-limit conditions are met, including associated-corporation rules. The filing deadline is not the payment deadline.
Does a dormant corporation still have to file?
Yes. Even a corporation with no activity or income must file a T2 return each year. Failing to file a dormant corporation's returns can lead to penalties and, eventually to dissolution for non-compliance.
What documents are needed to prepare a T2 return?
Articles of incorporation, the year's income statement and balance sheet, the general ledger and bank statements, asset purchase invoices for capital cost allowance, payroll records, T5 slips for shareholder dividends, and the prior-year T2 return and Notice of Assessment.
What records should a corporation keep?
The CRA requires corporations to keep complete records — including source documents, ledgers, and supporting documents for every transaction — for six years from the end of the tax year they relate to, in a format the CRA can read.