The Canada Revenue Agency has set the prescribed interest rates that apply to amounts owed to the CRA and payments the agency owes to taxpayers from October 1 to December 31, 2026.
The CRA’s quarterly schedule places the rate on overdue income taxes, Canada Pension Plan contributions and employment insurance premiums at 7% for the fourth quarter.
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What the CRA rates mean for taxpayers
People who have an outstanding balance with the CRA may be charged interest at the 7% annual rate on overdue amounts during this period.
The same 7% overdue rate applies to several other federal remittances, including GST, HST, the air travellers security charge, fuel charge amounts, excise taxes, the Underused Housing Tax and the Luxury Tax.
The rate is annual, so the actual amount charged on a balance depends on the size of the debt and how long it remains unpaid.
Interest can continue to accumulate until the outstanding amount is paid, meaning taxpayers who cannot pay in full may want to review available CRA payment options instead of ignoring a notice.
How much interest does the CRA pay on overpayments
The CRA’s prescribed rates also determine how much interest may be paid on certain overpayments owed to taxpayers.
| Situation | Fourth-quarter rate |
|---|---|
| Overdue income tax, CPP and EI amounts | 7% |
| Corporate taxpayer overpayments | 3% |
| Non-corporate taxpayer overpayments | 5% |
| Taxable benefits from interest-free or low-interest loans | 3% |
| Corporate taxpayers’ pertinent loans or indebtedness | 6.29% |
For non-corporate taxpayers, the overpayment rate is 5%, while corporations receive a 3% rate on qualifying overpayments.
These rates do not mean every tax refund automatically earns interest, since the CRA applies refund-interest rules based on the type of payment and the circumstances of the account.
Businesses face the same 7% overdue rate on GST and HST
Businesses with overdue GST or HST remittances face the 7% rate listed by the CRA for the fourth quarter.
Where a GST or HST remittance is overpaid, the CRA lists a 3% rate for corporate taxpayers and a 5% rate for non-corporate taxpayers.
The schedule also covers other federal charges, including the Digital Services Tax and the Global Minimum Tax, both of which carry a 7% overdue rate and a 3% corporate overpayment rate in the published table.
Why the CRA updates these rates every quarter
Prescribed interest rates are calculated quarterly under the laws governing the relevant tax and remittance programs.
The rates are therefore revised on a calendar-quarter basis rather than remaining fixed for the entire year.
The fourth-quarter schedule covers October 1 through December 31, 2026, after which a new rate schedule may apply.
What Canadians should check now
Anyone who received a CRA notice showing a balance owing should confirm the amount, due date and interest calculation in their CRA account or correspondence.
Taxpayers who cannot pay a personal income tax or COVID-19 benefit debt of at least $1,000 may be able to use the CRA’s Manage balance service to make a payment, schedule payments or request contact from a collections officer.
Paying sooner can reduce the time over which interest accumulates, although taxpayers should first confirm that the balance is correct.
Businesses should also review GST/HST, payroll and other remittance accounts before filing deadlines pass.
What happens after December
The current CRA rates remain in place until December 31, 2026.
The agency’s next quarterly schedule will determine the prescribed rates for the first calendar quarter of 2027.
Frequently Asked Questions
What is the CRA interest rate on overdue taxes from October to December 2026?
The CRA’s prescribed annual rate on overdue income taxes, CPP contributions and EI premiums is 7% from October 1 to December 31, 2026.
How much interest does the CRA pay on non-corporate overpayments?
The fourth-quarter rate for non-corporate taxpayer overpayments is 5%.
What is the CRA interest rate on overdue GST and HST?
The overdue rate for GST and HST remittances is 7% for the fourth quarter of 2026.
What happens if I cannot pay my CRA balance in full?
Eligible taxpayers may be able to use the CRA’s Manage balance service to make a full or partial payment, arrange payments or request assistance.
How long do the CRA’s fourth-quarter interest rates apply?
The rates apply from October 1 through December 31, 2026, before the CRA issues its next quarterly schedule.
Fact-Checked: Key rates, effective dates and payment options were checked against the Canada Revenue Agency’s official fourth-quarter 2026 interest-rate page and taxpayer guidance.
Disclaimer: CRA interest calculations can depend on the type of account and the timing of a payment, so taxpayers should review their individual notice or account details.