Incorporated but Not Making Money? What CRA Still Expects You to File

Zero Income Doesn’t Mean Zero Responsibility

Many Canadian business owners are surprised to learn that incorporating a business comes with filing obligations—even if the corporation isn’t making money. Whether your company is inactive, just starting out, or had a slow year, CRA still expects compliance.

At Tiki Tax, we regularly help clients who assumed “no income” meant “nothing to file”—only to receive penalties or CRA notices later.

Incorporation Creates Ongoing CRA Obligations

Once you incorporate, CRA treats your corporation as a separate legal entity. That status doesn’t disappear just because revenue is low—or zero.

Until the corporation is formally dissolved, CRA expects certain filings every year, regardless of activity.

You Still Need to File a Corporate Tax Return (T2)

Even if your corporation:

• Earned no income

• Had no expenses

• Was inactive all year

You are still required to file a T2 corporate tax return annually.

Failing to file can result in:

• Late-filing penalties

• CRA compliance letters

• Delays or issues if you want to close the corporation later

A “nil” return is still a return.

GST/HST Filings May Still Be Required

If your corporation is registered for GST/HST, CRA expects filings based on your assigned reporting period.

Even with no sales, you may still need to:

• File a nil GST/HST return

• Confirm no tax was collected or claimed

Not filing simply because there was no activity can trigger penalties and CRA follow-up.

Payroll Filings May Apply Even Without Salary

If your corporation is registered for a payroll account, CRA may expect:

• Payroll remittances (if applicable)

• Year-end filings such as T4 summaries

Even if no salary was paid, CRA often expects confirmation. Ignoring this can lead to unnecessary compliance issues.

Annual Corporate Maintenance Still Matters

CRA doesn’t clearly explain that incorporation also involves:

• Maintaining corporate records

• Filing annual returns at the provincial level

• Keeping the corporation in good standing

Skipping these steps can cause problems if you later want to restart operations, apply for financing, or dissolve the company.

The Risk of Ignoring an Inactive Corporation

Many business owners simply “forget” about inactive corporations. Over time, this can lead to:

• Accumulated penalties

• CRA compliance actions

• Higher costs to clean things up later

It’s often more expensive to fix years of missed filings than to file properly each year.

Should You Keep or Close the Corporation?

If your corporation isn’t generating income and you don’t plan to use it soon, it may be time to:

• Properly maintain it, or

• Formally dissolve it

CRA won’t make this decision for you—but they will still enforce filing requirements.

How Tiki Tax Helps with Inactive or Low-Income Corporations

At Tiki Tax, we help business owners:

• File required nil T2 and GST/HST returns

• Clean up missed filings

• Communicate with CRA

• Decide whether to keep or dissolve a corporation

• Stay compliant without unnecessary costs

No Income Doesn’t Mean No Filing

Incorporation comes with responsibilities—regardless of profit.

👉 Contact Tiki Tax today if your corporation isn’t making money but you’re unsure what CRA still expects you to file. We’ll help you stay compliant and avoid costly surprises.

🌐 Website: https://www.tikitax.ca/