T5 form

The T5 form is an official document that reports to the government the investment income paid to an individual: dividends (a share of the profits that a corporation pays to its owner) and interest. The business paying this money must file the T5 by the end of February. In Quebec, it is accompanied by the Relevé 3 form.

At a glance

Be sure to report dividends (the portion of profits a business pays to its owner) and investment interest
Your business, not you, is required to file this form when it pays you a dividend
Deadline: the last day of February following the year of payment
In Quebec, it is accompanied by a second document: Form 3, which is sent to Revenu Québec
Late filing results in a penalty of at least $100, which increases depending on the number of forms and the number of days late

Why it matters

Imagine this: In December, you pay yourself $40,000 in dividends from your business to supplement your income. Many business owners forget that an official form, the T5 (and the Relevé 3 in Quebec), must be filed every February, prepared by the business itself. Failing to do so risks late penalties: late filing of a T5 form costs at least $100, and more depending on the number of forms and the number of days late. The government automatically compares the T5 forms it receives with your personal tax return: a missing form stands out immediately, like a missing piece of a puzzle, and it is often this cross-check that triggers a tax audit. The decision to pay you a dividend (T5) rather than a salary (T4 form) or fees (T4A form) also affects your tax situation and, in the case of benefits, overlaps with the Taxable benefits. The form and deadlines are published by the Canada Revenue Agency. Good news: it only takes a few minutes to file every February. Bankeo provides you with a free, vetted accountant or CPA who handles your tax forms, and we’re here to support you every step of the way.

Frequently asked questions

What exactly is a T5 form?

It’s a short official form that tells the government how much investment income a person received during the year: mainly dividends (a share of profits paid to a business owner) and interest. If you own an incorporated business and pay yourself a dividend, your business fills out this T5 form for you, along with the Relevé 3 in Quebec.

What is the deadline for filing a T5?

The last day of February following the year of the payment, whether sending it to the government or giving it to the person concerned. A delay results in penalties that increase based on the number of forms and the number of days late. A dividend paid in December therefore leaves little time to prepare the documents.

What’s the difference between a T4 and a T5?

The T4 form is used for salary (with taxes already withheld from each paycheck); the T5 form is used for investment income such as dividends (with no taxes withheld in advance). A business owner who chooses to pay themselves a salary or dividends will therefore generate one or the other. Bankeo connects you, for free, with a vetted accountant or CPA who will handle your tax forms stress-free, and we’ll be there for you every step of the way.