Partnership Tax Returns (T5013)
Reviewed by EverStone CPA · July 2026
A partnership doesn’t pay income tax of its own — but many partnerships still have to file. The T5013 partnership information return tells the CRA what the partnership earned and how that income was split, and it feeds every partner’s own return. EverStone CPA prepares partnership information returns remotely for partnerships across BC and Canada from its Abbotsford base.
A partnership is not a separate taxpayer the way a corporation is. The CRA treats it as a conduit: income and losses are computed at the partnership level, then flowed out to the partners, who report their share on their own return — a T1 for an individual partner, a T2 for a corporate partner, or a T3 where a trust is the partner. Because the partnership itself never files an income tax return, the CRA needs a separate mechanism to see the numbers and to check that every partner reported a consistent share. That mechanism is the T5013 partnership information return, together with the T5013 slips issued to each partner.
Not every partnership has to file one. Small two-person partnerships that stay under the CRA’s reporting thresholds and have only individual partners are generally outside the requirement. But the thresholds catch more businesses than owners expect — particularly the rule that pulls in any partnership with a corporation or a trust as a partner, regardless of size. That single rule is why so many joint ventures between holding companies, professional partnerships and family structures end up filing.
What a partnership information return engagement includes
- A filing assessment — whether the partnership is actually required to file at all
- The T5013 financial return and supporting schedules, prepared from your year-end figures
- Allocation of net income or loss to each partner under the partnership agreement
- T5013 slips prepared and distributed to every partner by the filing deadline
- Coordination with each partner’s T1 or T2 return so the reported shares agree
- Capital cost allowance, adjusted cost base tracking and partner capital account continuity
Who has to file a T5013
Under the Income Tax Regulations, partnerships carrying on business in Canada and Canadian partnerships must file a partnership information return — but CRA administrative policy narrows that to partnerships meeting one of the following tests. A partnership that meets any single one of them files.
The size thresholds
A partnership files if, at the end of the fiscal period, the combined absolute value of its revenues and expenses exceeds $2 million, or it has more than $5 million in assets.
A corporation or trust is a partner
If at any time during the fiscal period the partnership has a corporation or a trust as a partner, it has to file — with no size threshold at all. This is the trigger most owners miss. Two contractors who each hold their interest through a holding company have a partnership that files from day one.
Tiered partnerships
A partnership that has another partnership as a partner, or is itself a partner in another partnership, files regardless of size. Multi-layer real estate and development structures land here routinely.
Flow-through shares
A partnership that invested in flow-through shares of a principal-business corporation that incurred Canadian resource expenses and renounced them to the partnership must file.
The CRA asks for one
If the Minister of National Revenue requests a return in writing, the partnership files — whether or not any other test is met.
How the asset test is measured
The $5 million asset test uses the cost of all assets worldwide, tangible and intangible, before depreciation. Book value net of accumulated amortization is not the measure, which pushes some asset-heavy partnerships over the line unexpectedly.
There is one notable carve-out worth knowing about in the Fraser Valley: farm partnerships made up of only individual partners are not required to file a T5013 return for the 2025 fiscal year. A farm partnership that includes a corporation or a trust as a partner still files. If you run a farm operation that has incorporated part of the structure, that exemption stops applying.
When the T5013 is due
The due date depends entirely on who the partners are, and it is one of the few Canadian filing deadlines where the answer genuinely changes based on the composition of the ownership group. The same date also governs when the T5013 slips have to be in each partner’s hands — you cannot file the return on time and send the slips later.
All partners are individuals
If throughout the fiscal period every partner is an individual, the return is due March 31 after the calendar year in which the partnership’s fiscal period ended. The CRA treats a trust as an individual for this test. That date is deliberately set before the personal filing deadline so partners have their slips in time to prepare their own returns.
All partners are corporations
If throughout the fiscal period every partner is a corporation, the return is due five months after the end of the partnership’s fiscal period. A December 31 year end means a May 31 filing date; a March 31 year end means August 31.
A mix of the two
In every other case — and a partnership with one individual and one holding company is the common example — the return is due on the earlier of March 31 following the calendar year in which the fiscal period ended, or five months after the fiscal period end. Mixed partnerships therefore get the tighter of the two dates, not the more generous one. If a due date falls on a Saturday, Sunday or public holiday recognized by the CRA, the return is due the next business day.
If the partnership winds up
Where a partnership ends its operations before the usual end of its fiscal period, outstanding returns are due on the earlier of 90 days after the date it ended all business or activity, or the date the return would otherwise have been due. Winding up a partnership mid-year can therefore pull a filing deadline forward by months, and it can create two fiscal periods ending in the same calendar year — two returns, both on the accelerated date.
How income reaches the partners
Net income or loss is calculated once, at the partnership level, using the partnership’s own fiscal period and its own capital cost allowance claims. That figure is then allocated among the partners and reported to each of them on a T5013 slip. The allocation follows the partnership agreement — it is not automatically equal, and it is not a function of what was actually withdrawn from the business during the year. Draws are not income; the allocated share is.
Character follows the allocation as well. Business income, capital gains, dividends, charitable donations and resource deductions keep their identity as they flow through, which is why the T5013 slip has so many boxes. A capital gain realized inside the partnership is still a capital gain in the partner’s hands; a donation made by the partnership is claimed by the partners. Getting the character right matters as much as getting the dollar amount right, because the partner’s own return applies different rules to each type.
When the partner is an individual
An individual partner reports the allocated share on their T1 for the tax year in which the partnership’s fiscal period ended. The income is generally business income, which means CPP contributions on self-employment earnings and, where the numbers warrant, personal tax instalments. Individual partners who incurred GST/HST-bearing expenses personally in connection with the partnership may also be eligible for a rebate as a member of the partnership. This is where partnership work overlaps with personal tax filing, and the two should be prepared together rather than by separate hands.
When the partner is a corporation
A corporate partner reports its share on its T2 corporate return, and the interaction gets more involved. The share lands in the corporation’s income and is then subject to the corporate rules that apply to it — including how much of it qualifies for the small business deduction, since specified partnership income rules exist precisely to stop a single business limit from being multiplied across partners. The corporation’s own year end may differ from the partnership’s, so the allocation lands in whichever corporate tax year the partnership’s fiscal period ended in. For incorporated owners, this is the point where the partnership return and the T2 corporate return have to be planned as one file rather than two.
Adjusted cost base and capital accounts
Each partner’s adjusted cost base in the partnership interest moves every year: allocated income increases it, allocated losses and withdrawals reduce it. If nobody tracks that continuity, the number needed when an interest is eventually sold or the partnership is wound up simply does not exist, and it has to be reconstructed years later from incomplete records. A negative adjusted cost base can also trigger a deemed capital gain in the meantime. Keeping the capital accounts current is part of the return, not an optional extra.
What happens if the return is late
The partnership pays no tax, so it is easy to assume a late return is harmless. It is not. A T5013 partnership information return filed late attracts a penalty of $25 per day, from a minimum of $100 to a maximum of $2,500. The same per-day penalty structure applies to a partner or partnership that fails to file an information return when required, including distributing the T5013 slips to recipients late.
Repeated failures escalate sharply. Where the CRA has already assessed a failure-to-file penalty for the fiscal period, has formally demanded the return from a partner, and has assessed a penalty in any of the three preceding fiscal periods, an additional penalty applies of $100 for each member multiplied by the number of months or part months the return remains unfiled, to a maximum of 24 months. In a partnership with several members, that compounds quickly. The practical takeaway is simple: a partnership that has drifted out of filing is better off being brought current deliberately than left alone.
Working with EverStone, start to finish
We confirm the filing obligation
We test the partnership against each CRA criterion, confirm the fiscal period and identify the correct due date based on who the partners are — then quote a fixed fee in writing before any work begins.
We prepare the return and the slips
We prepare the financial return and schedules from your year-end figures, allocate income or loss under the partnership agreement, and produce a T5013 slip for every partner.
We tie it to each partner’s return
We make sure the allocated shares carry cleanly into each partner’s T1 or T2, update adjusted cost base continuity, and file electronically.
Partnership work sits alongside bookkeeping, year-end financial statements and the corporate returns of any incorporated partner. If you are still deciding how to hold the business, the comparison in sole proprietor vs corporation is a useful starting point.
Partnership return questions
Does a partnership pay income tax?+
Does every partnership have to file a T5013?+
My partner is a holding company. Do we have to file?+
When is the T5013 due?+
What is the penalty for filing late?+
How does the partnership income get onto my own return?+
Do farm partnerships have to file?+
Can you handle the partnership return and each partner’s return?+
Why clients stay with EverStone
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Official resource: CRA — T4068, Guide for the Partnership Information Return (T5013 Forms)
Information on this page was last reviewed in July 2026. See our how our content is reviewed.
If you are sorting out how a partnership interacts with the rest of your structure, these go further: the year-end checklist for incorporated owners, choosing a corporate fiscal year end, T2 deadlines and what late filing costs, how CRA reviews a small business file.
Need a partnership return filed?
We prepare T5013 partnership information returns and slips, and tie the allocation into each partner’s own return. Book a free consult and we’ll confirm whether your partnership has to file.