Tax instalments: the threshold rises from $3,000 to $7,500
Fewer people and companies will have to pay tax in advance. From 2028, instalments start only when more than $7,500 is owing, and the self-employed can pay once a year instead of four times.
Quick answer: Budget 2026 proposes raising the instalment threshold from $3,000 to $7,500 for individuals and corporations (from $1,800 to $4,500 for Quebec residents), indexed to inflation, for tax years starting in 2028. Self-employed people could instead pay a single instalment of two-thirds of the year’s tax by December 31. Until then the $3,000 threshold still applies.
What an instalment is
An instalment is tax paid in advance during the year, instead of all at once when you file. Today the CRA expects instalments from individuals whose tax owing is more than $3,000 in the current year and either of the two previous years, and from corporations owing more than $3,000.
What changes
| Now | From 2028 (proposed) | |
|---|---|---|
| Individuals and corporations | $3,000 | $7,500, indexed |
| Quebec residents | $1,800 | $4,500, indexed |
| Self-employed payment option | Quarterly | One payment of two-thirds of the year’s tax by December 31 |
Example
Leah is a self-employed bookkeeper whose tax owing is about $6,000 a year. Today she pays four instalments. From 2028 she would pay none, because $6,000 is below $7,500. Her neighbour Sam owes $12,000 a year; from 2028 he could make one payment of $8,000 (two-thirds) by December 31 and pay the rest with his return.
What to do. Keep paying instalments as the CRA asks for 2026 and 2027. Interest on missed instalments still applies until the new rule takes effect.
Whether this applies to you depends on your year-end and structure; ask about your own situation and a CPA replies by email, usually the same business day, free.
Common questions
When does the $7,500 instalment threshold start?+
Does it apply to corporations?+
Do I still pay instalments in 2027?+
Where this comes from
Budget 2026 was tabled on 5 November 2026. Figures on this page are from:
- BLG — Federal Budget 2026: tax measures
- RBC Wealth Management — Federal budget 2026 overview
- Thor — 2026 Federal Budget: key tax measures
General information, not tax advice. Budget measures are proposals until enacted and can change. Before deciding anything, send an enquiry.