Self-Employed, Rental and Investment Income Can Trigger a December CRA Payment
For many Canadians, income tax is deducted automatically from every paycheque. But if you are self-employed or receive income without enough tax withheld, CRA may require you to pay tax throughout the year instead. The final regular 2026 tax instalment is due December 15.
You may have to make 2026 tax instalments if your net tax owing is more than $3,000 — or $1,800 if you live in Quebec — for 2026 and was also above that threshold in either 2025 or 2024. The remaining regular instalment deadline for 2026 is December 15.
What Are Tax Instalments?
Tax instalments are advance payments toward the income tax you would otherwise have to pay when you file your tax return.
For an employee, an employer normally deducts income tax from each paycheque and sends it to CRA.
But some types of income may have little or no tax withheld during the year. CRA uses instalments to collect some of that tax as the income is earned rather than waiting until the following spring.
Who Might Have to Pay?
CRA says you may have to pay tax by instalments when your income does not have enough tax withheld.
This can commonly affect Canadians who receive:
- self-employment income,
- rental income,
- investment income,
- certain pension payments, or
- income from more than one job.
Simply having one of these types of income does not automatically mean you have to make instalments. Your net tax owing is what matters.
The $3,000 Rule
For most Canadians, CRA looks at a $3,000 net tax owing threshold.
You generally have to pay income tax by instalments for 2026 if both of the following apply:
- Your net tax owing for 2026 is more than $3,000, and
- Your net tax owing in either 2025 or 2024 was also more than $3,000.
For Quebec residents, the threshold is $1,800 instead of $3,000.
What Are the 2026 Instalment Dates?
Most individuals who are required to make instalments have four payment dates during the year.
| 2026 Instalment | Due Date |
|---|---|
| First | March 15 |
| Second | June 15 |
| Third | September 15 |
| Fourth | December 15 |
Farmers and fishers can have different instalment rules, including a December 31 payment date.
How Do You Know If CRA Expects an Instalment?
CRA sends instalment reminders to people it believes will likely have to pay their income tax by instalments.
The reminders are generally issued twice during the year:
- A February reminder covering the March and June payments.
- An August reminder covering the September and December payments.
You can also view your instalment reminders through your CRA account.
If you received a 2026 instalment reminder but your actual 2026 net tax owing will be $3,000 or less — $1,800 or less in Quebec — CRA says you do not have to make instalment payments for 2026.
Can You Pay Less Than the Amount on CRA’s Reminder?
Potentially, yes.
CRA provides different methods for calculating instalments. You can generally use CRA’s no-calculation option, a prior-year option or a current-year option.
The current-year method can be useful when your income has fallen significantly and you reasonably expect to owe less tax this year.
But there is a risk.
If you reduce your instalments based on your own estimate and ultimately owe more than expected, CRA can charge instalment interest on the shortfall.
What Happens If You Miss December 15?
CRA can charge instalment interest when required payments are late or insufficient.
CRA says instalment interest can apply when:
- you were required to pay instalments,
- CRA sent you an instalment reminder showing an amount to pay, and
- you paid late, paid too little or did not make the required payment.
An additional instalment penalty may also apply when instalment interest reaches the applicable CRA threshold.
Self-Employed Canadians Should Pay Particular Attention
Tax instalments can surprise people during their first years of self-employment.
Unlike a regular employee, a self-employed person generally does not have an employer automatically deducting income tax from every payment they receive.
Depending on earnings, a self-employed individual may also be responsible for both the employee and employer portions of CPP contributions.
The result can be a substantial amount owing at tax time — and potentially a requirement to begin making instalments during future years.
Rental Property Owners Can Be Affected Too
Rental income is another common situation where sufficient income tax may not be withheld during the year.
If your rental income contributes to net tax owing above the CRA threshold, you could eventually find yourself paying quarterly instalments even if your primary employment income already has tax deducted at source.
The same basic issue can arise with investment income and other sources where tax withholding is insufficient.
Do You Need to Do Anything?
- Check your CRA account for an instalment reminder.
- Review the amount CRA says you should pay.
- Consider whether your 2026 income or tax situation has changed substantially.
- If you are required to make an instalment, make sure the payment reaches CRA on time.
- Keep a record of the payment for your 2026 tax return.
The Bottom Line
December 15 is the final regular CRA tax instalment deadline of 2026.
The deadline is especially relevant to Canadians with self-employment, rental, investment or other income where insufficient tax is withheld.
For most Canadians outside Quebec, the key threshold is net tax owing of more than $3,000. In Quebec, it is more than $1,800.
If CRA sent you an instalment reminder, don’t simply ignore it. Check whether you are actually required to pay and, if you are, make the required payment by the deadline to avoid unnecessary interest or penalties.
Canada Revenue Agency — Required Tax Instalments for Individuals
Canada Revenue Agency — Who Has to Pay Tax Instalments
Canada Revenue Agency — Instalment Interest and Penalty Charges
VIPNews explains Canadian government information in plain English. This article provides general information and is not personal tax, accounting or financial advice.