The federal budget weighed in at a daunting 511 pages, making for some heavy reading. Parsing through the pages, here are five tax changes you need to know about.
Filing deadline moving to May 15
The official tax deadline for most Canadians to file individual tax returns is April 30. If you or your spouse or common-law partner were self-employed during the year, then you have until June 15 to file. If, however, you owe the Canada Revenue Agency (CRA) money, you still need to pay by April 30 to avoid non-deductible arrears interest, currently being charged at a rate of seven per cent, compounded daily.
The 2026 budget is proposing to change both the filing and balance-due dates to May 15 for all individuals, including self-employed individuals and their spouses or common-law partners, creating one uniform deadline for everyone, and making the due date the same as the filing date.
The change in date would be for the 2027 tax year.
Objecting to an assessment
After you file your tax return, you receive a Notice of Assessment (NOA) from the CRA. If you disagree with the way the CRA has assessed your return, you have the ability to object.
For individual taxpayers, the deadline for filing an objection is one year from the normal filing due date or 90 days after the date printed on the NOA, whichever is later. Practically speaking, that means if you filed your tax return by the April 30 deadline and you received your NOA at some point in 2026, you have until April 30, 2027, to file an objection.
If you miss the deadline, you can still apply to the CRA for an extension within one year of the deadline. Should the CRA deny your application, or, if you don’t receive a response from the CRA within 90 days, you may further appeal to the Tax Court of Canada. And, if the Tax Court denies your application, you can appeal that decision to the Federal Court of Appeal.
The budget is proposing to amend the deadline to file a notice of objection for individuals to the later of one year after the NOA is sent and two years from the tax return filing due date for the taxation year being assessed. This will eliminate the need for taxpayers to apply for an extension of time, and, as a result, the ability to do so would be eliminated.
This change would apply to assessments sent on or after the day that is three months after the enacting legislation receives royal assent.
Form T1135
Under the current rules, if you own “specified foreign property” with a total cost that exceeds $100,000 at any point in a tax year, you are required to file Canada Revenue Agency’s Form T1135, Foreign Income Verification Statement. Specified foreign property includes obvious foreign assets, such as a Cayman bank account. Also included are foreign stocks, held in a Canadian, non-registered brokerage account. Specified foreign property held inside registered accounts are excluded.
The $100,000 threshold for reporting property hasn’t been increased since it was introduced in 1998. The budget is proposing to double the threshold to $200,000, starting in 2027.
Also, if you’re required to file Form T1135 in a year, but the cost of your specified foreign property is below $250,000 throughout the entire year, you can use a “simplified reporting method” found on Part A of Form T1135. This method allows you to check a box for each type of property you held during the year, rather than providing the details of each property. The budget is proposing to double the simplified reporting threshold to $500,000 for 2027 and subsequent years.
Instalments
Under the Income Tax Act, quarterly tax instalments are required for this tax year if your balance due for 2026 will be more than $3,000 ($1,800 for Quebec tax filers) and was greater than $3,000 ($1,800 for Quebec) in either 2025 or 2024.
Today’s budget proposed to increase the threshold to $7,500 (from $3,000) for corporations and individuals resident outside Quebec, and to $4,500 (from $1,800) for individuals resident in Quebec. The thresholds would be indexed to inflation and rounded to the nearest $500.
This measure would apply to taxation years that begin on or after January 1, 2028. As with the current rules, in determining whether instalments would be required the relevant threshold would need to be exceeded for the current year and either of the two previous years.
In addition, to help individuals whose primary source of income is from a business (including professional or commission income), the budget is proposing to allow these individuals to make a single annual instalment payment, instead of quarterly instalments. The single instalment payment would equal two thirds of their combined federal-provincial net tax owing for the year and be due by December 31. The remainder would be due on the normal balance due date.
This measure would apply to the 2028 and subsequent taxation years.
An RRSP for life
The budget is proposing a major change to our registered retirement savings system by announcing its intention to merge the core features of the registered retirement savings plan (RRSP) and registered retirement income fund (RRIF) under into a single vehicle referred to as an “RRSP for life.” This would eliminate the need for individuals to convert their RRSP to a RRIF at age 71. Individuals over the age of 71 would continue to be required to make minimum withdrawals, starting at age 72.
To this end, the government is seeking Canadians’ views on this proposal, and has opened a consultation period during which interested parties are invited to send written representations to the Department of Finance by January 8, 2027.
One issue under consideration is whether the RRSP rules could include a “successor holder,” namely the spouse or common law partner of the original plan holder. The concept of successor currently exists under a RRIF and a tax-free savings account. This would allow an RRSP to remain open until the death of the successor holder, and avoid the value of RRSP property potentially being included in the income of the deceased.