--- title: "CRA Penalties to Rise 2–3x From 2028: Budget 2026" url: https://www.everstonecpa.com/tax-update/cra-penalties-increase description: "Budget 2026 proposes raising most fixed CRA penalties two to three times, indexing them, and charging larger firms more. See which penalties change." type: tax-update updated: 2026-11-06 summary: "For tax years ending after 2027, Budget 2026 proposes that most fixed-dollar penalties rise two to three times and be indexed every five years. Medium corporations ($10–50 million taxable capital) would pay three times the base penalty and large corporations (over $50 million) eight times. Failing the same filing three years running doubles the base. GST/HST penalties are included." faq_count: 3 publisher: EverStone CPA Inc., a Chartered Professional Accountant firm registered with CPA British Columbia and CPA Alberta service_area: British Columbia, Alberta, Ontario and Manitoba language: en-CA contact: info@everstonecpa.com · https://www.everstonecpa.com/book-online --- [Home](https://www.everstonecpa.com/) [Tax updates](https://www.everstonecpa.com/tax-updates) [Budget 2026](https://www.everstonecpa.com/tax-update/federal-budget-2026) CRA penalties are going up CRA compliance # CRA penalties are going up: what Budget 2026 proposes By EverStone CPA · Updated November 2026 Most fixed-dollar CRA penalties have not changed in decades. Budget 2026 proposes to raise them two to three times, index them every five years, and charge larger businesses more for the same failure. **Quick answer:** For tax years ending after 2027, Budget 2026 proposes that most fixed-dollar penalties rise two to three times and be indexed every five years. Medium corporations ($10–50 million taxable capital) would pay three times the base penalty and large corporations (over $50 million) eight times. Failing the same filing three years running doubles the base. GST/HST penalties are included. **Behind on a filing?** Getting current before the higher penalties apply costs less than waiting. We bring overdue returns up to date at a fixed fee. [Get My Fixed Quote](https://www.everstonecpa.com/book-online?service=catch-up#enquiry-form) **Announced, not yet law** · Tax years ending after 2027 (proposed) This has been announced but is not yet law. It can change or be withdrawn. ## What changes Proposed penalty changes | Change | Detail | | Fixed-dollar penalties | Most increased two to three times, then indexed every five years | | Medium corporations ($10–50M taxable capital) | 3 times the base penalty | | Large corporations (over $50M) | 8 times the base penalty | | Repeated failures | Base penalty doubles after the same failure three years in a row | | Example: false T1135 statement | Minimum rises from $24,000 to $45,000 | Most owner-managed businesses are in the base level, so they see the inflation increase but not the size multipliers. ## Example A small corporation files its information slips late three years in a row. Under the proposal, the fourth year’s penalty is the new base amount doubled. Filing on time in any one of those years resets the pattern. **What to do.** If any return or slip is outstanding, file it now while the current amounts apply. The CRA’s [Voluntary Disclosures Program](https://www.everstonecpa.com/blog/voluntary-disclosures-program-canada-fixing-past-returns) can reduce penalties for errors you correct before the CRA asks. Whether this applies to you depends on your year-end and structure; [ask about your own situation](https://www.everstonecpa.com/quick-question) and a CPA replies by email, usually the same business day, free. ## Common questions **When do the higher CRA penalties start?** For tax years and fiscal periods ending after 2027, if enacted. **Do GST/HST penalties go up too?** Yes. GST/HST and several excise penalties are included and would be indexed. **Will a small business pay the 3x or 8x multiplier?** No. Those apply to corporations with $10 million or more of taxable capital, or partnerships with $2 million or more of revenue. ## Where this comes from Budget 2026 was tabled on 5 November 2026. Figures on this page are from: - [BLG — Federal Budget 2026: tax measures](https://www.blg.com/en/insights/2026/11/federal-budget-2026-sovereignty-strategic-investment-and-tax-simplification) - [Thor — 2026 Federal Budget: key tax measures](https://www.thor.ca/blog/2026/11/2026-federal-budget-key-tax-measures/) - [RBC Wealth Management — Federal budget 2026 overview](https://www.rbcwealthmanagement.com/en-ca/insights/federal-budget-2026-an-overview-of-key-measures-that-may-impact-you) **General information, not tax advice.** Budget measures are proposals until enacted and can change. Before deciding anything, [send an enquiry](https://www.everstonecpa.com/book-online?service=catch-up#enquiry-form). [Federal Budget 2026: what changes for small business owners](https://www.everstonecpa.com/tax-update/federal-budget-2026) [Tax debts over $50,000 can be reported to credit bureaus](https://www.everstonecpa.com/tax-update/tax-debt-credit-bureau) [Disputing a CRA assessment: one year instead of 90 days](https://www.everstonecpa.com/tax-update/objection-deadline-one-year) --- Source: https://www.everstonecpa.com/tax-update/cra-penalties-increase Prices: https://www.everstonecpa.com/pricing · Contact: info@everstonecpa.com · https://www.everstonecpa.com/book-online