At a glance
#Dates are for an example year end of Dec 31, 2025. Where local law moves a deadline on a weekend or national public holiday to the next working day, the date shown is already moved. Use the Deadlines tool for your own year end and thresholds.
Verified 2026-10-28. Tax authority: Canada Revenue Agency (CRA). Summaries are simplified; check the linked official source before relying on them.
The law
#Transfer pricing is in section 247 of the Income Tax Act (R.S.C. 1985, c. 1 (5th Supp.)). Bill C-15 (Budget 2025 Implementation Act, No. 1, S.C. 2026, c. 3, Royal Assent 26 March 2026) rewrote s. 247 for taxation years beginning after 4 November 2025: a single adjustment rule in new s. 247(2.02) based on 'actual conditions' versus 'arm's length conditions', accurate delineation in s. 247(1.01), and new s. 247(2.03)-(2.04) requiring the rules to be applied consistently with the OECD Transfer Pricing Guidelines (2022 version). Earlier years use the old s. 247(2) adjustment and recharacterization rules.
Documentation
#No Master File / Local File format in law. Under s. 247(4) a taxpayer with cross-border non-arm's length transactions must make or obtain contemporaneous documentation by its documentation-due date (the return filing-due date, 6 months after year end for corporations). For taxation years beginning after 4 November 2025 it must be provided within 30 days of a written CRA request (previously 3 months). New s. 247(4.1) allows simplified documentation if prescribed conditions are met; the supporting regulations were only released in draft in July 2026. English or French.
Methods
#Methods follow the OECD Guidelines. The most appropriate method is selected under s. 247(2.04) (new rules). CRA guidance (IC87-2R, now cancelled and archived by the CRA) historically preferred CUP, then resale price / cost plus, then profit methods; the new law points to the OECD most appropriate method standard instead.
Penalties
#s. 247(3) penalty of 10% of net TP adjustments that exceed the lesser of 10% of gross revenue and CAD 10m (CAD 5m for years beginning before 5 November 2025). Adjustments count as 'reasonable efforts' adjustments, and are excluded from the penalty base, only if s. 247(4) documentation was prepared on time and provided on request. T106 late filing: s. 162(7) and s. 162(10) penalties.
Pillar Two
#Canada's Global Minimum Tax Act applies the IIR and a QDMTT for fiscal years starting on or after 31 December 2023. The UTPR (for years starting on or after 31 December 2025) and a side-by-side safe harbour are in Bill C-31, which had not received Royal Assent at last check. Groups file a GIR or GIR Notification and a global minimum tax return, and pay, 15 months after year end (18 months for the first year, 30 June 2026 for 2024 years).
Other rules
#APAs under IC94-4R (bilateral and unilateral). Secondary adjustments: an upward TP adjustment for a Canadian corporation is deemed a dividend to the non-resident under s. 247(12) and s. 214(3), subject to Part XIII withholding, unless the CRA agrees to repatriation. Excessive interest and financing expenses limitation (EIFEL, s. 18.2) caps net interest at 30% of adjusted taxable income. Thin capitalization (s. 18(4)) 1.5:1 debt to equity still applies. Large corporations pay instalments monthly; balance due 2 or 3 months after year end. CbC notification (not required): CRA guidance says a Canadian UPE or surrogate parent need not notify in advance. Status (UPE, SPE, CE) is shown on Form RC4649 itself.
Filings and deadlines
#| # | Filing | When | Who | Source |
|---|---|---|---|---|
| 1 | T2 Corporation Income Tax Return Due 6 months after year end (ITA s. 150(1)(a)). Month-end year ends file by the last day of the 6th month. Balance of tax is due 2 months after year end (3 months for some CCPCs). | 6 months after year end (e.g. Jun 30, 2026) | All resident corporations and non-resident corporations carrying on business in Canada. | CRA: T2 Corporation Income Tax Guide, before you start |
| 2 | T106 Information Return of Non-Arm's Length Transactions with Non-Residents Due on or before the filing-due date of the T2 return (ITA s. 233.1). One T106 slip per non-resident. Late filing penalties under s. 162(7) and s. 162(10). | With T2 Corporation Income Tax Return (e.g. Jun 30, 2026) | Required when total reportable transactions with non-arm's length non-residents in the year exceed CAD 1m. | Income Tax Act s. 233.1 (Justice Laws) |
| 3 | Contemporaneous TP documentation (s. 247(4)) Must be made or obtained by the documentation-due date (the T2 filing-due date). Not filed with the return. Bill C-15 (Royal Assent 26 March 2026) adds more detailed documentation content rules and higher s. 247(3) penalty thresholds for tax years beginning after 4 November 2025. | With T2 Corporation Income Tax Return (e.g. Jun 30, 2026) | Any taxpayer with transactions with non-arm's length non-residents that wants reasonable-efforts protection from the s. 247(3) penalty. | Income Tax Act s. 247 (Justice Laws) |
| 4 | Form T1134 Information Return Relating to Controlled and Not-Controlled Foreign Affiliates Due 10 months after the end of the tax year (for tax years beginning after 2020). Late-filing penalties under ITA s. 162(7) and s. 162(10). | 10 months after year end (e.g. Nov 2, 2026) (moved from Oct 31, 2026, a Saturday) | Canadian resident taxpayers (including corporations) with a foreign affiliate at any time in the year. | Income Tax Act s. 233.4(4) (Justice Laws) |
| 5 | Country-by-Country Report (Form RC4649) Due 12 months after the last day of the reporting fiscal year (ITA s. 233.8). Late filing: CAD 25 per day (min CAD 100, max CAD 2,500) under s. 162(7), and CAD 500 per month (CAD 1,000 after a demand) for up to 24 months under s. 162(10). | 12 months after year end (e.g. Dec 31, 2026) | Canadian ultimate parent of an MNE group with consolidated revenue of EUR 750m or more in the prior fiscal year, or a Canadian constituent entity required to file locally. | CRA RC4651 Guidance on Country-by-Country Reporting in Canada |
| 6 | GloBE Information Return or GIR Notification File the GIR with the CRA, or a GIR Notification if the parent or a designated filer files it abroad. Due 15 months after year end, 18 months for the group's first year in scope of any qualified IIR or UTPR; for fiscal years ending on or before 31 December 2024 the due date is 30 June 2026. Late GIR penalty is CAD 25,000 per complete month up to CAD 1m (Global Minimum Tax Act s. 98), with relief for years starting before 2027 where reasonable measures were taken. | 15 months after year end (e.g. Mar 31, 2027) | Groups with consolidated revenue of at least EUR 750m in at least two of the four preceding fiscal years. | Canada.ca: Global minimum tax, get ready to file |
| 7 | Global minimum tax return and payment (Global Minimum Tax Act) Return for IIR tax (Part 2) and domestic minimum top-up tax (Part 3), with payment due on the same date: 15 months after year end, 18 months for the first year, 30 June 2026 for years ending on or before 31 December 2024. Filed electronically through the CRA's API (JSON for the return, XML for the GIR); payments use the PT program account number. | 15 months after year end (e.g. Mar 31, 2027) | Groups with consolidated revenue of at least EUR 750m in at least two of the four preceding fiscal years. | Canada.ca: Global minimum tax, get ready to file |
| 8 | TP documentation provided on CRA request 30 days after a written request for taxation years beginning after 4 November 2025. For earlier years (for example a fiscal year ending 30 June 2026 that began 1 July 2025) the old 3 month period applies. | Within 30 days of a tax authority request | Same as contemporaneous documentation. | Income Tax Act s. 247(4) (Justice Laws) |
| 9 | Master File (no Canadian requirement) No statutory Master File. CRA may request group information under general audit powers. | See note | Canada has not adopted a Master File rule. | CRA: Transfer pricing |
Official texts
#- Income Tax Act s. 247 (transfer pricing) (Open Government Licence - Canada (Justice Laws XML datasets on open.canada.ca))
- Consolidated federal Acts and regulations in XML (dataset) (Open Government Licence - Canada)
- Income Tax Regulations Part XCVIII (simplified TP documentation), draft (Government of Canada website terms (not confirmed as OGL))