Tax · Owing CRA
CRA arrears interest calculator.
Owe CRA and not sure what the interest adds up to? Enter the unpaid balance and two dates. The calculator compounds daily at each quarter's overdue rate. For late or short instalments, use the Instalment Interest & Penalty Calculator.
CRA charges arrears interest on unpaid tax from the balance-due day to the day you pay, compounded daily. The rate is the prescribed rate plus 4 percentage points, reset every quarter. For Q4 2026 (1 October to 31 December) it is 7%.
Inputs
Result
Enter the amount owing and both dates, then press Calculate.
Worked example
You owe $10,000 for 2024, due 30 April 2025, and pay on 30 April 2026 (365 days). The overdue rate was 8% in Q2 2025 and 7% in the four quarters after it. Compounding daily, each quarter adds interest to the balance the next one starts from:
| Quarter | Days | Overdue rate | Interest added |
|---|---|---|---|
| 2025 Q2 (30 Apr to 30 Jun) | 62 | 8% | $136.80 |
| 2025 Q3 | 92 | 7% | $180.42 |
| 2025 Q4 | 92 | 7% | $183.63 |
| 2026 Q1 | 90 | 7% | $182.80 |
| 2026 Q2 (1 to 30 Apr) | 29 | 7% | $59.58 |
| Total | 365 | $743.24 |
Balance after a year: $10,743.24. That is 7.43% of the debt, a little more than the simple 7 to 8% because of daily compounding.
Formula
For each day, balance × (1 + r ÷ 365), where r is the overdue rate for the quarter that day falls in. Over n days in one quarter that is balance × (1 + r ÷ 365)n, and the quarters are chained. The overdue rate is the base prescribed rate plus 4 percentage points.
CRA overdue-interest rates by quarter
Rate charged on overdue taxes, CPP contributions and EI premiums. As of 1 October 2026; the Q4 2026 rate runs 1 October to 31 December 2026.
| Quarter | Starts | Base prescribed rate | Overdue rate (base + 4%) |
|---|---|---|---|
| 2026 Q4 | 2026-10-01 | 3% | 7% |
| 2026 Q3 | 2026-07-01 | 3% | 7% |
| 2026 Q2 | 2026-04-01 | 3% | 7% |
| 2026 Q1 | 2026-01-01 | 3% | 7% |
| 2025 Q4 | 2025-10-01 | 3% | 7% |
| 2025 Q3 | 2025-07-01 | 3% | 7% |
| 2025 Q2 | 2025-04-01 | 4% | 8% |
| 2025 Q1 | 2025-01-01 | 4% | 8% |
| 2024 Q4 | 2024-10-01 | 5% | 9% |
| 2024 Q3 | 2024-07-01 | 5% | 9% |
| 2024 Q2 | 2024-04-01 | 6% | 10% |
| 2024 Q1 | 2024-01-01 | 6% | 10% |
| 2023 Q4 | 2023-10-01 | 5% | 9% |
| 2023 Q3 | 2023-07-01 | 5% | 9% |
| 2023 Q2 | 2023-04-01 | 5% | 9% |
| 2023 Q1 | 2023-01-01 | 4% | 8% |
| 2022 Q4 | 2022-10-01 | 3% | 7% |
| 2022 Q3 | 2022-07-01 | 2% | 6% |
| 2022 Q2 | 2022-04-01 | 1% | 5% |
| 2022 Q1 | 2022-01-01 | 1% | 5% |
| 2021 Q4 | 2021-10-01 | 1% | 5% |
Sources, verified 1 October 2026: Canada.ca — Prescribed interest rates (and each quarter's page linked from it); Canada.ca — Understanding interest for the wording that arrears interest is compounded daily from the balance-due day to the date of payment. The base rate column is the rate CRA lists for taxable benefits on low-interest loans, which equals overdue minus 4 in every quarter.
Frequently asked questions
Is CRA arrears interest compounded?
Yes. CRA's interest page says arrears interest is compounded daily on any unpaid balance from the balance-due day to the date of payment. Interest is added to the balance each day, so it earns interest itself.
Where does the rate come from?
CRA announces the prescribed rates every quarter. The rate on overdue taxes is the base prescribed rate plus 4 percentage points: in Q4 2026 that is 3% + 4% = 7%. The table on this page lists every quarter from Q4 2021.
Does this work for GST/HST or payroll debts?
The overdue rate CRA publishes for these is the same 7% in Q4 2026, but this page is built and checked against the income tax rate and the arrears wording. Confirm other programs on your CRA statement.
Why does my CRA statement differ?
CRA also charges interest on penalties, credits payments and refunds on the dates it receives them, and may cancel interest under taxpayer relief. This estimate has none of that, and uses a 365-day year.
Can I stop interest?
Interest keeps running daily until the balance is paid. A payment reduces the balance it runs on. Ask CRA about a payment arrangement or taxpayer relief if you cannot pay.
Estimate only
Uses a 365-day divisor in every year and calendar-day counts. It does not model payments made along the way, interest on penalties, instalment interest, Revenu Québec, or taxpayer relief. Your CRA statement and My Account are the authority.