Entity Setup
What the CRA’s 2026-27 Business Plan Means for Entities & Compliance
Canada’s CRA plan for 2026-27 brings big changes affecting businesses—new incentives, stronger rules, and a focus on digital and international transparency.
By NomadicTax Research Team • 5-8 min read • April 26, 2026
## Big Picture: CRA Business Plan Highlights
In its *2026-27 Corporate Business Plan*, CRA outlines priorities like making tax credits more accessible, enhancing compliance and leaning into digital services. Key highlights:
- **Automatic tax filing** for ~1 million Canadians by 2027; ~5.5 million by 2028.
- Phasing out the **Underused Housing Tax** and **luxury tax on aircraft & vessels** as part of trimming complexity and reducing administrative sludge. ([canada.ca](https://www.canada.ca/en/revenue-agency/corporate/about-canada-revenue-agency-cra/summary-corporate-business-plan/summary-cbp-2026-29.html?utm_source=openai))
- Stronger enforcement internationally and domestically, including work under the **global minimum tax** and anti-avoidance rules. ([canada.ca](https://www.canada.ca/en/revenue-agency/corporate/about-canada-revenue-agency-cra/summary-corporate-business-plan/summary-cbp-2026-29.html?utm_source=openai))
## Entity-Level Implications
- Businesses claiming **clean-economy investment tax credits** or enhanced SR&ED credits need to pay attention. CRA plans to expand eligibility and monitor uptake. ([canada.ca](https://www.canada.ca/en/revenue-agency/corporate/about-canada-revenue-agency-cra/summary-corporate-business-plan/summary-cbp-2026-29.html?utm_source=openai))
- Corporations should prepare for **stricter transparency** in cross-border operations and profit allocation. Global Minimum Tax (Pillar Two) will continue to be a focus. ([canada.ca](https://www.canada.ca/en/revenue-agency/corporate/about-canada-revenue-agency-cra/summary-corporate-business-plan/summary-cbp-2026-29.html?utm_source=openai))
## Compliance & Reporting Changes to Watch
- CRA will seek more data, increase audits of tax avoidance or evasion, especially involving foreign-affiliate income. ([canada.ca](https://www.canada.ca/en/department-finance/news/2026/01/government-launches-consultation-on-draft-legislation-for-previously-announced-and-technical-tax-measures.html?utm_source=openai))
- For provinces like British Columbia, tax credits (manufacturing, film) now have extended claim periods, altered filing rules, and removed requirements—for example, no completion certificate required in some cases. ([canada.ca](https://www.canada.ca/en/revenue-agency/services/tax/businesses/topics/corporations/whats-new-corporations.html?utm_source=openai))
- Strengthened rules for trusts, mutual funds, and entities controlled by groups (corporate, individuals, or trust-entities) to clarify who controls what and avoid indirect control loopholes. ([canada.ca](https://www.canada.ca/en/revenue-agency/services/tax/businesses/topics/corporations/whats-new-corporations.html?utm_source=openai))
## Entity Setup & Strategic Moves
- Select entity structure carefully: for example, Canadian-controlled private corporations (CCPCs) might benefit from enhanced tax credits under SR&ED if they meet the updated thresholds. ([canada.ca](https://www.canada.ca/en/revenue-agency/services/tax/businesses/topics/corporations/whats-new-corporations.html?utm_source=openai))
- Foreign affiliate income and insurance-related foreign assets may be more closely scrutinized; clear documentation becomes essential. ([canada.ca](https://www.canada.ca/en/department-finance/news/2026/01/government-launches-consultation-on-draft-legislation-for-previously-announced-and-technical-tax-measures.html?utm_source=openai))
- If operating in multiple provinces, always check for provincial tax credits and their unique claiming requirements or timelines (e.g., British Columbia manufacturing and processing investment credits). ([canada.ca](https://www.canada.ca/en/revenue-agency/services/tax/businesses/topics/corporations/whats-new-corporations.html?utm_source=openai))
## Action Plan for Businesses
1. Map out upcoming credit eligibility and filing deadlines by province; update your internal calendars.
2. Audit your cross-border and foreign affiliate arrangements; evaluate tax treaty positions.
3. Streamline record keeping, especially around foreign-income and investment tax deductions.
4. Prepare for enhanced reporting and disclosures; consider early consultations with tax advisors to stay ahead.
5. Review entity control structures to ensure compliance with new rules on indirect control and mutual fund corporation status.
The CRA’s 2026-27 agenda is all about balancing innovation and fairness. Entity owners that adapt early will benefit—not just avoid risk.