Moving your corporation to another province

A corporation’s tax province is not its mailing address and not the statute it was incorporated under. Provincial corporate tax follows the permanent establishment — generally a fixed place of business, and in some cases an employee or agent with authority to contract — so the province changes when the establishment does, not when the letterhead does. And in the year of a move the corporation generally has an establishment in both provinces at some point in the year, which means its taxable income is allocated between them by formula. The formula does not ask what date you handed back the keys.

The two years either side of a move are ordinary. The move year is the one worth getting right in advance.

Three different things get called moving

The first is the incorporating jurisdiction — the statute the corporation exists under. Changing it is a continuance, a corporate-law act that involves both registries and has nothing to do with the T2, the corporation’s income tax return. The second is the registered office address, also corporate law. The third is the permanent establishment, which is where the business is actually carried on.

Only the third one moves the tax. A corporation incorporated federally has no province of its own at all — it registers extra-provincially wherever it carries on business. A corporation incorporated in one province and operating in another is taxed in the second whether or not anyone ever changes the first. That gap is what makes this expensive: the registry step and the tax filing are separate, and no tax authority will remind you about the registry one.

The move year splits by formula, not by the calendar

Where a corporation has a permanent establishment in more than one province, its taxable income is allocated among them generally by a formula weighting the gross revenue and the salaries and wages attributable to each establishment. In a move year that condition is usually met, because the old establishment existed for part of the year and the new one for the rest.

What the allocation runs on is the fiscal year’s figures. Relocating does not close the corporation’s books the way an acquisition of control does — there is no deemed year-end, no stub period, and your year-end stays where you put it. So the split follows where the year’s revenue was earned and where the year’s wages were paid, and those two factors frequently disagree.

Each province then applies its own rates to its own share, with its own business limit deciding where its small-business rate ends. The federal layer does not move at all: an eligible CCPC pays 9% on the first C$500,000 of active business income in 2026 regardless of which provinces the establishments sit in. What differs by province is everything stacked on top.

A worked example: the office closes in April, the new one opens in May

Illustrative, round numbers, December 31 year-end. The amounts are invented and no rate appears, because the rates are the part your two provinces set.

A consultancy bills C$900,000 for the year and pays C$300,000 in salaries and wages. The first province’s office is open through April 30, the second province’s from May 1, with a month of overlapping rent and nothing else overlapping.

Revenue attributable to the first establishment comes to C$360,000 and to the second C$540,000 — a 40/60 split. Salaries and wages land at C$90,000 and C$210,000, because the team relocated with the office and two hires arrived in the autumn — 30/70. The formula weights both, and here they are ten points apart.

Now change one fact and leave the move date alone. The two largest contracts are billed in the first and second quarters out of the old office, and the new hires are deferred to January. Both factors swing toward the old province, on an identical physical move. That is the whole point: the allocation is an outcome of where the year’s revenue and payroll actually sat, which is why it is worth modelling in October, while the year can still be arranged around the answer, rather than in June of the following year when the only remaining task is to report it.

Payroll: the account stays, the province of employment changes

Your payroll account with the CRA does not move. Same business number, same RP account, same remittance schedule. What changes is the province of employment reported for each employee — broadly, the establishment the employee reports to — which sets the provincial income tax withheld inside the same remittance and shows on the T4, the slip reporting employment income. Leave it on the old province and employees under-withhold or over-withhold all year and settle it on their personal returns; the slips themselves then need amending, which is real work for a mistake nobody noticed in May. New TD1 forms, federal and the new province’s, belong to the same pay period as the change.

Everything else on the employer side is a pair of accounts, not one that travels.

• Workers’ compensation. Each province’s board has its own account, its own schedule and its own definition of assessable earnings — not the base you used for the CRA remittance — with premium rates following industry classification. A move means a final payroll report to the old board and registration with the new one once you have a worker there. The two boards do not talk to each other.
• A provincial payroll levy, where the new province charges one. Its exemption and its threshold are its own, and leaving a province that charges one does not close that account by itself.
• Provincial sales tax. Moving into a province that runs its own generally adds a registration; moving out of one generally means a final return and a deregistration nobody sends a reminder about. Harmonized provinces have neither.
• Extra-provincial registration with the new province’s registry, and withdrawal from the old one. Corporate law, on corporate-law timing.

The GST/HST registration itself is untouched — one federal registration, unchanged by the move. The rate you charge still follows the place of supply rather than where you sit. One quiet exception: quick-method remittance rates vary by province and are tied to the establishment through which the supply is made, so a move can change what you remit without changing a line on your invoices.

Alberta and Quebec are the two that administer their own

Everywhere else the CRA collects the provincial corporate tax on the T2 you already file. Moving into Alberta generally adds the AT1 on its own calendar; moving into Quebec adds a CO-17 with Revenu Québec, QST beside GST, RL-1s beside T4s, and a registry declaration. Moving out of either does not end the year you were there — the allocation still gives that province a share, and that province’s own return is where the share gets reported.

The federal dates are unmoved by any of this: the T2 six months after year-end — June 30 for a December 31 year-end — with the balance generally due at two months, three for many CCPCs claiming the small-business deduction. The deadline table has the rest. Instalments are the exception worth watching, because the ones you pay during the move year were computed on last year’s provincial mix. Move to a province with a higher rate and they are short before anyone looks.

One more test runs separately from all of the above. Your own provincial tax generally follows where you reside at the end of the year, which is not the corporation’s test and not the corporation’s date. In a move year the two can land in different provinces, and sometimes should.

What Cadence does

We work the allocation before your year-end rather than reporting it after: the two factors on your actual revenue and payroll, with enough of the year left that the answer can still change what you do. Then the list — which registrations open, which close, which board gets a final payroll report, and what the province of employment on each T4 says from the pay period the move takes effect. The T2 with the allocation on it is corporate tax work, in every package. The account transitions around it are GST/HST and payroll work, included in the year-round packages and available as add-ons on the annual-returns tier; which provincial accounts we prepare and which we coordinate we confirm at the estimate. A move into Quebec we accept based on fit and the capabilities required, and we answer that before onboarding rather than during it. Consultants and agency owners ask about this most, because their establishment moves the week the owner does.