As a small business owner, you may be asking yourself: “Do I need to submit a T5 slip in addition to a T4 slip?”
T5’s are prepared on a calendar year basis for interest, royalty or dividend payments made from a Corporation from January to December.
- Did your company pay interest on a private loan or mortgage during the year?
- As a shareholder, did you receive interest on an interest-bearing shareholders loan during the year?
- Did you pay taxable, eligible or ordinary dividends to shareholders during the year?
- Were preferred shares redeemed in your company during the year? There will likely be a deemed dividend.
If you answered yes to any of the above questions, you will likely need to report these figures on a T5 slip.
You do not have to prepare a T5 slip when payments are less than $50, interest is paid from one individual to another individual, and when interest is paid on loans from banks or other institutions whose usual business includes lending money. You also do not need to issue a T5 slip for tax-free capital dividends.
Note that payments made to a non-resident of Canada follow different reporting standards and do not require a T5 slip to be filed.
If you have any questions or would like assistance preparing your T5 information returns, please contact RHN to speak with one of our professionals today.
For a complete listing of payments that need to be reported, please refer to http://www.cra-arc.gc.ca/tx/bsnss/tpcs/slps/fnncl/t5/t5slp/prpr-eng.html
This post has been prepared for general information purposes. It is not advice. The information presented may not fit your unique situation, please consult one of our trusted business advisors at RHN CPA for further clarification and interpretation of your circumstances.