CRA Business Numbers: What Do the Codes Mean?

When you start a business in Canada, you'll quickly encounter the need for a Business Number (BN) assigned by the Canada Revenue Agency (CRA). This BN is your business's unique tax identification and helps organize your various tax accounts. However, the BN is more than just a random number—it includes different program account identifiers that reveal the specific taxes and obligations tied to your business.

In this blog, we'll explain the different codes on your CRA business number, explicitly focusing on RT, RP, and RC accounts for tax, payroll, and corporate income tax purposes.

The Structure of a CRA Business Number

Your CRA business number is a 15-digit number, including the 9-digit Business Number (BN). This base identifier stays the same across all accounts and is unique to your business.

A 2-letter program identifier

This indicates the specific tax account type. If necessary, a 4-digit reference number differentiates between multiple accounts for the same program (e.g., if you have more than one payroll account).

For example, a total CRA number might look like this: 123456789RT0001

Now, let's dive into what each of these codes means.

RT: GST/HST Program Account

The RT code is associated with GST/HST accounts. If your business must collect and remit Goods and Services Tax (GST) or Harmonized Sales Tax (HST), this account tracks those activities.

When do you need an RT number?

If your business's annual taxable revenues exceed $30,000, you're legally required to register for a GST/HST account. Even if you earn less than that, registering voluntarily might be beneficial, as it allows you to claim Input Tax Credits (ITCs) on GST/HST paid for business expenses.

What does it track?

This account tracks all the GST/HST your business collects from customers and the

GST/HST you pay on business purchases (eligible for ITCs).

Example: 123456789RT0001 is a GST/HST account for a business with the

Business Number 123456789.

RP: Payroll Program Account

The RP code is used for your Payroll Program Account, which manages payroll deductions such as income tax, Canada Pension Plan (CPP) contributions, and Employment Insurance (EI) premiums. This account is crucial if you have employees.

When do you need an RP number?

If you're paying wages to employees or yourself as the business owner, you need a payroll account to manage and remit these deductions to the CRA.

What does it track? This account ensures you properly withhold and remit the required

deductions for each employee and your employer contributions for CPP and EI.

Example: 123456789RP0001 indicates the payroll program for a business with

BN123456789.

RC: Corporate Income Tax Program Account

The RC code is tied to your Corporate Income Tax account. You need this account to file your corporation's annual income tax return if your business is incorporated.

When do you need an RC number?

If you've incorporated your business, you must register for a corporate income tax account and file a corporate tax return, regardless of whether you owe any taxes.

What does it track?

The RC account tracks your corporation's annual tax filings, payments, and refunds. It ensures you meet your corporate tax obligations to the CRA.

Example: 123456789RC0001 represents the corporate tax account for a corporation with the BN 123456789.

Why Understanding These Codes Is Important

Each CRA program account plays a specific role in managing your business's financial interactions with the CRA. Here's why it's essential to understand what they mean:

1. Avoid Misfiling: Knowing the correct code ensures you remit taxes to the correct account and file the proper forms. Mixing up your GST/HST (RT) and payroll (RP) accounts could lead to errors, delays, or penalties.

2. Compliance: A legal requirement is to have the correct program accounts registered and active. If you need to set up an account (e.g., not registering for a payroll account when you hire your first employee), it could result in fines or other penalties.

3. Audit Preparedness: Clear distinctions between your tax, payroll, and corporate income tax filings make complying with CRA audits and inquiries more accessible.

Get the Most Out of Your CRA Numbers

Understanding your CRA business numbers and the codes that accompany them—RT, RP, and RC—is vital for staying compliant and running your business operations smoothly. Whether you're registering for GST/HST, managing employee payroll, or filing corporate taxes, knowing which program account applies to your situation can help you avoid costly mistakes.

If you're overwhelmed by CRA numbers or unsure if your business has the correct accounts, contact me at TidierBooks! I can help you set up and manage your CRA program accounts, ensuring that you stay on top of your tax obligations and focus on what you do best—growing your business.