Budget 2026: Five Changes to How You File Your Taxes
On November 5, 2026, François-Philippe Champagne, the Minister of Finance and National Revenue, presented the 2026 Federal Budget, the second budget under the government’s new fall budget cycle.
Despite ongoing trade and geopolitical uncertainties, the budget emphasizes a stronger economic position than a year ago, highlighting G7-leading growth in the second quarter and falling unemployment rates.
Spanning 511 pages of proposals to boost productivity and diversify trade, the budget also addresses major changes to the tax filing process. Here are the five key changes:
- Filing Deadline Change: The filing and balance-due dates will move from April 30 to May 15 for all individuals, including self-employed individuals and their spouses or common-law partners. This creates a uniform deadline for everyone and will take effect for the 2027 tax year.
- Objections to Assessments: Currently, individual taxpayers have one year from the normal filing due date or 90 days after the date on the Notice of Assessment (NOA) to file an objection, whichever is later.
Change: The 2026 budget amends this deadline to the later of one year after the NOA is sent or two years from the tax return’s filing due date for the taxation year being assessed. This change will eliminate the need for taxpayers to apply for an extension of time, as that option will be removed.
- Form T1135 Amendment: Under existing rules, if you own “specified foreign property” that exceeds a total cost of $100,000 at any point during a tax year, you must file the Canada Revenue Agency’s Form T1135 (Foreign Income Verification Statement).
Change: The 2026 budget doubles the threshold to $200,000 starting in 2027. Additionally, if you are required to file Form T1135 for a year but your specified foreign property is valued below $250,000 for the entire year, you may use a simplified reporting method in Part A of Form T1135.
- Installment Payments Update: According to the Income Tax Act, you are required to pay quarterly tax installments for the current tax year if your balance due for 2026 exceeds $3,000 (excluding Quebec) and was also greater than $3,000 in either 2025 or 2024.
Change: The 2026 budget increases this threshold to $7,500 for corporations and individuals residing outside of Quebec. These thresholds will be indexed to inflation and rounded to the nearest $500, applying to taxation years beginning on or after January 1, 2028.
- Introduction of “RRSP for Life”: The budget proposes merging the essential features of the Registered Retirement Savings Plan (RRSP) and the Registered Retirement Income Fund (RRIF) into a single entity called the “RRSP for Life.” This change would eliminate the requirement to convert an RRSP into an RRIF at age 71. However, individuals over 71 will still be required to make minimum withdrawals starting at age 72.
These changes aim to streamline the tax filing process and make it more manageable for individuals.
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