Calgary businesses! Read this now because businesses need to be prepared in advance. What follows is the comprehensive update from the Canada Revenue Agency, and this is what Calgary businesses should know about new CRA compliance in 2025. This will assist with how businesses should approach taxes, reporting, and compliance for this year and in the future.
With a stronger focus on digital processes, increased enforcement, and various tax rule updates, the CRA is modernising its interface with Canadian businesses. Banks and financial institutions have new requirements, capital gains adjustments, new short-term rental regulations, trust reporting rules changes, just to mention a few.
The changes are significant and material, and we expect that with the right planning, Calgary businesses will benefit, rather than face costly penalties or miss an opportunity. The purpose of this is to help you keep ahead of these changes, so you can ensure you have the appropriate reporting in place and you maximise the benefits.
Accepting Online Mail For Business Correspondence Going
RA is going paperless! This initiative started in spring 2025, and CRA will move the bulk of business correspondence to online-only via My Business Account. This means that letters, notices, or reminders will no longer arrive via regular mail. There is only some time left for businesses to get on a path to ensuring they do not miss critical updates.
In this respect, not all businesses will be affected, but new business registrations, existing business accounts on My Business Account, and business accounts that are represented through their accountant or bookkeeper with Represent a Client will be affected.
What now?
- Log in to your CRA My Business Account
- Check your email address
- Enable notifications to stay fully aware of all correspondence.
You may ask yourself, “What does this mean for your business in Calgary?” It means that CRA will not send a practical duplicate (via paper) mail, and missing a digital notification could lead to missed filing deadlines or set off a compliance review. So, in order to avoid such penalties, consult Tax Headaches to understand the CRA compliance better.
Capital Gains Tax Legislation Has Changed
The rules are already set out, but do you comply? The CRA has released a capital gains inclusion rate for all taxpayers, including corporations. Any capital gains that are realised on or after June 25, 2024, are subject to the rate -even if approval in parliament is still pending.
If you are a Calgary-based investor, real estate developer, or incorporated business, this change may affect tax planning and the structure of investment portfolios, as well as asset sales. On a different note, CRA granted interest and penalty relief for affected corporations and trusts until March 3, 2025. But did you know? In 2022, Canadian corporations reported an increased capital gains inclusion rate between 50 to 66%. Higher inclusion rates often mean larger tax bills for many.
CPP Contributions Are Coming For Employers And Employees
The Canada Pension Plan (CPP) is well underway with its multi-year enhancements, with 2025 being the last scheduled update. As of 2025, the Year’s Maximum Pensionable Earnings (YMPE) for CPP will rise to $71,300 (up 7% from 2024). The Year’s Additional Maximum Pensionable Earnings (YAMPE) will be raised to $81,200, which simply means that higher earnings may require additional CPP contributions. This is great news, and a wake-up call to employers and employees in Calgary.
What does this mean?
If your employees earn between $71,300 and $81,200, they will have to deduct and remit additional CPP2 contributions. Changes to the CPP will affect your budgeting and payroll if your Calgary business has wage earners like this on payroll for 2025.
Bare Trust Exemption Extends With Trust Reporting Obligations
If you have ‘bare trusts’ involved in real estate or business transactions, you don’t have to file T3 returns or Schedule 15 for 2024 with the CRA. This only applies unless they contact you directly. Congratulations! However, other trusts still must file T3 returns with details of the beneficial ownership as per the new transparency obligations.
Who does this apply to? Family-owned & operated businesses, investment vehicles, or estate planning structures using trusts in Calgary. What do you need to do? Make sure you have checked off the owners of your trust to see if it is exempt, or run the risk of failing to meet the reporting requirements.
Less Tax Deductions for Short-Term Rentals
If you happen to be running an Airbnb or short-term rental business in Calgary, you must comply with all municipal and provincial licensing laws by December 31, 2024. This is in order to claim deductions on any expenses related to claiming your expenses. In fact, this applies in both a business capacity and as an individual. Keeping this in mind, the city of Calgary requires that short-term rental operators:
- Get a business license.
- Register the property as a short-term rental; and
- Comply with noise, guest, and zoning regulations
If you’ve not already registered, then you could potentially lose deductions for your mortgage interest, utilities, and maintenance as of 2025. It is better to be safe than sorry and consult with one of the experts at Tax Headaches for tax services in Calgary.
CRA’s New Audit Powers
In a lower-profile reform, CRA has increased its powers regarding tax audits and tax information gathering. The new rules will likely take place no sooner than 2025. While these powers are meant to increase the speed of the audit process so delays don’t occur, many tax professionals have expressed the possibility of these powers being poorly used or, at a minimum, overused.
Four things you should watch for:
- CRA can now interrogate you under oath – in person or in writing.
- CRA could send you a non-compliance notice with a penalty of up to $25,000.
- CRA can now offer automatic penalties if you do not comply with one of its orders.
- CRA can suspend limitation periods and, by doing so, extend its audit options.
My Business Account Is Getting Smarter
The CRA’s digital tools received a major upgrade in 2023, intended to help make managing your taxes faster and easier. If you are not using the CRA tools, they will not help you. My Business Account has been improved with a clean layout, new real-time payment tools, customisable email alerts, access to your Canada Carbon Rebate, and new SR&ED self-assessment tools.
My Business Account has more capabilities than before, and they can only help you if you take a small amount of time to get them set up.
How You File T4s, T5s, and Other Info Returns
If your business files T4S, T5S, NR4s, or other information returns electronically, there are substantial changes to be aware of starting in 2025. CRA is taking steps to try to eliminate errors with submission rules, but your systems may need to be updated to avoid a misstep. Ranging from T619 to strict validations and an amended one-return-at-a-time approach, one misplaced character may lead to a return being rejected.
Relief Extended for Dental Plan Reporting (T4/T4A)
If you do not offer dental benefits in your Calgary business, then you are in luck: CRA is extending administrative relief for Canadian Dental Care Plan (CDCP) reporting. You may leave the CDCP box blank on your 2024 T4/T4A forms if you have made reasonable efforts to be compliant.
Actually, CRA held a free CDNCP Webinar on January 29, 2025, on reporting updates, penalties, and form instructions.
2025 Compliance Checklist for Calgary Businesses
- Up-to-date contact info in My Business Account
- Notifications are enabled for the digital CRA mail
- Re-calculate CPP and CPP2 payroll impacts
- Re-evaluate capital gains and trust reporting approach
- Register short-term rentals and review bylaws
- Prepare for digital-only T4/T5 filing
- Email preferences for CRA notices
- Attend CRA webinars and subscribe to updates
Conclusion
CRA’s 2025 compliance updates indicate just how quickly the industry is evolving to real-time digital compliance, increasing enforcement, and making tax reporting more transparent.
This is the year for Calgary businesses to be proactive. From updating your online account and reviewing your capital gain approach to ensuring that your rental and trust structures are correctly reported, the price of waiting is greater than ever.