Entrepreneurship & Small Business

What to do with corporate T5 slips

  • Last Updated:
  • Feb 28th, 2020 10:37 am
Member
Sep 23, 2019
298 posts
356 upvotes
Toronto

What to do with corporate T5 slips

I received T5 slips on HISA investment for my incorporated business. I of course track all interest paid on this account and report it as "interest income". Do I have to enter this T5 slip anywhere in the corporate tax T2 form?
4 replies
Deal Fanatic
Oct 7, 2007
9404 posts
5374 upvotes
Is your business' year end December 31st? If so, I would use the T5 slips to report interest income on your T2 return.
My business is not December 31st so I just save the T5's with my corporate tax records but have to do my own calculations to calculate the precise amount of interest earned for the taxation period.
Member
Sep 23, 2019
298 posts
356 upvotes
Toronto
choclover wrote: Is your business' year end December 31st? If so, I would use the T5 slips to report interest income on your T2 return.
My business is not December 31st so I just save the T5's with my corporate tax records but have to do my own calculations to calculate the precise amount of interest earned for the taxation period.
Choclover - thank you for reply!
My business year end in Jan 1st. Of course I include interest income into T2. If I keep my business money in Tangerine business account, I get paid monthly interest, but nobody issues me T5. But of course, for my accounting books to match, I have to include interest income into my business income. But I could not find a place where I can input T5 into my T2 tax form, so there is no separate form.. So it appears that correct way is just to add ALL interest - in my case from tangerine and from T5 and just add it as interest income in T2.
Deal Fanatic
Oct 7, 2007
9404 posts
5374 upvotes
RedFlagAlias wrote: Choclover - thank you for reply!
My business year end in Jan 1st. Of course I include interest income into T2. If I keep my business money in Tangerine business account, I get paid monthly interest, but nobody issues me T5. But of course, for my accounting books to match, I have to include interest income into my business income. But I could not find a place where I can input T5 into my T2 tax form, so there is no separate form.. So it appears that correct way is just to add ALL interest - in my case from tangerine and from T5 and just add it as interest income in T2.
Yes, that sounds correct to me. At the end of the day, you want to report all interest income earned for your year ending January 1st onto your T2. Presumably, you calculate this when you prepare your financial statements that you use to complete your T2 from but, regardless, as long as you capture all EARNED interest for the taxation year, you will be fine. You can keep your T5's as supporting documentation in case of possible audit in the future.
Sr. Member
Jan 18, 2017
607 posts
527 upvotes
AB
That's because there isn't a place to conveniently enter t-slips on a corporate tax return: it doesn't exist. Corporate tax returns are not plug-and-play like their T1 counterparts.

All interest/investment income gets entered on the Sch 125. Then you enter the interest income again on the Sch 7.

Generally speaking, in terms of T2 prep, t-slips get ignored other than to make ROC allocations or to test reasonableness. If you happen to have a Dec 31 YE though, they can be somewhat helpful.
RedFlagAlias wrote: Choclover - thank you for reply!
My business year end in Jan 1st. Of course I include interest income into T2. If I keep my business money in Tangerine business account, I get paid monthly interest, but nobody issues me T5. But of course, for my accounting books to match, I have to include interest income into my business income. But I could not find a place where I can input T5 into my T2 tax form, so there is no separate form.. So it appears that correct way is just to add ALL interest - in my case from tangerine and from T5 and just add it as interest income in T2.
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MR CROSSBORDER KNOW IT NOTHING, but ready to spew forth. (Also a CPA)

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