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What is the difference between T3, T4, T4A and T5 slips?
A T4 reports employment income and the CPP, EI and tax withheld by an employer. A T4A reports other income paid by a business or plan: contractor fees, pensions, commissions, scholarships, RESP payments. A T5 reports investment income paid by a corporation or bank: dividends and interest. A T3 reports income allocated to you by a trust, including mutual funds and ETFs held in a non-registered account. T4, T4A and T5 slips are due by the last day of February; T3 slips are due 90 days after the trust's year-end, which is why they arrive last. Verified against CRA filing guidance, September 2026.
At a Glance
In Canada, tax reporting involves various forms, each serving a unique purpose for taxpayers and the Canada Revenue Agency (CRA). Among these are the T3, T4, T4A, and T5 slips, which are essential for individual tax filing. These slips are all different in the information they convey but are unified in their role to communicate taxpayers’ income to the CRA.
The T4 slip, known as the Statement of Remuneration Paid, reports employment income and is provided by employers to their employees. It includes wages, bonuses, and other forms of compensation along with deductions made throughout the year, such as income tax, Employment Insurance, and Canada Pension Plan contributions.
In contrast, the T4A slip, or Statement of Pension, Retirement, Annuity, and Other Income, serves a broader purpose. It records various forms of income that are not covered by the T4 slip, such as pension payments and other types of earnings, which may not come from a traditional employer-employee relationship. The T5 slip communicates investment income, including interest, dividends, and royalties, paid or credited to the taxpayer. Meanwhile, the T3 Statement of Trust Income Allocations and Designations is given to beneficiaries of trusts, reporting amounts such as the trust's income and capital gains allocated to them. Each slip is integral to accurately filing an individual's tax return and understating their full income picture for the year.
Overview of Canada's Tax Slip System
In Canada, tax slips are official documents that report income and deductions for the fiscal year. They play a critical role in the tax-filing process for individuals and businesses. The proper identification and use of these slips are essential for accurate tax reporting and compliance.
T3 slips report income from trust allocations and distributions, while T4 slips are used to declare employment income, including salaries, wages, and other remuneration paid to employees. Employers must issue T4 slips to their employees by the last day of February following the calendar year to which the slips apply.
T4A slips differ from T4s as they report pension, retirement, annuity, and other income, which is often for non-employment scenarios like self-employment earnings. Unlike the T4, T4A slips may not show deductions for Canada Pension Plan (CPP) and Employment Insurance (EI), potentially requiring separate filing by the recipient.
Lastly, T5 slips communicate investment income such as dividends and interest paid to investors.
| Slip Type | Purpose |
|---|---|
| T3 | Trust income allocations and distributions |
| T4 | Employment income and deductions |
| T4A | Pension and other non-employment income |
| T5 | Investment income |
Taxpayers should ensure they include information from all relevant slips in their tax return. If a taxpayer has multiple income sources, they may receive several slips across these categories. Correct reporting ensures compliance with the Canada Revenue Agency (CRA) regulations and accurate assessment of taxes. Using cloud accounting software helps ensure all tax slip amounts are accurately recorded and matched to the correct line items on your return.
Understanding T3 Slips
T3 slips are crucial for Canadians to report certain types of income. They specifically pertain to income earned from trust funds.
Purpose of T3 Slips
The T3 slip, formally known as the Statement of Trust Income Allocations and Designations, is used by trusts to report the amounts disbursed to their beneficiaries. These slips indicate various types of distributions that a beneficiary may need to report on their tax return, including income and tax credits. Trusts are required to issue a T3 slip to each beneficiary for them to accurately complete their personal income tax returns.
Typical Recipients of T3 Slips
Individuals who receive income allocations from estates, trusts, or mutual fund trusts are typically the recipients of T3 slips. This does not include employees or independent contractors, but rather beneficiaries of the aforementioned income sources. For example, if a person is a beneficiary of a mutual fund trust, they should expect to receive a T3 slip to report distributions such as Return of Capital (ROC) or income from the trust.
Insights into T4 Slips
The T4 slip is a critical document for both employers and employees in Canada, outlining the employment income and deductions for the year.
Purpose of T4 Slips
A T4 slip, formally known as the Statement of Remuneration Paid, is issued by employers to confirm the amount of income earned by an employee during a tax year. Its primary purpose is to inform the employee and the Canada Revenue Agency (CRA) of the total income before deductions, including any additional earnings like bonuses or commissions. Employers must provide a T4 slip by the end of February following the calendar year to which the information relates. If you are an employer managing payroll, payroll software can automate T4 slip generation and CRA remittances. See our comparison of the best payroll software in Canada for the platforms we recommend.
Key Information on T4 Slips
The crucial details provided on T4 slips can be itemized as follows:
Employers are also required to include other relevant deductions and contributions that affect an employee's taxable income. Each slip must be accurate, ensuring employees can correctly report their income and claim eligible deductions when filing their personal income tax returns.
On the employer side, the T4 is produced by whatever runs your payroll. Wagepoint, built in Canada, calculates the deductions on each pay, remits them to the CRA automatically, and files the T4s and ROEs itself, from $20 a month plus $4 per employee. New customers who sign up through our referral link get a $50 gift card after their first payroll; the terms are on our Wagepoint deal page.
Exploring T4A Slips
A T4A slip reports various types of income not covered by T4 slips, such as pension, retirement, annuity, and self-employed commissions, which are crucial for accurate tax reporting in Canada.
Purpose of T4A Slips
T4A slips are tax forms used to report certain types of income to the Canada Revenue Agency (CRA) that are not included in traditional employment earnings. These incomes may include but are not limited to pension, retirement, annuity, and self-employed commissions. They serve to inform both the taxpayer and the CRA of the amounts to be considered for taxation which are not reported on T4 slips, primarily related to non-employment activities.
Distinguishing Features of T4A Slips
The T4A slip is distinguished by the various income types it covers. For example:
It's important for individuals to recognize the specific instances in which a T4A would be issued to them, as this will impact how they file their taxes and claim potential deductions or credits.
Deciphering T5 Slips
A T5 slip documents investment income such as interest or dividends paid to Canadian residents.
Purpose of T5 Slips
The T5 slip serves the critical function of reporting investment income to both the taxpayer and the Canada Revenue Agency (CRA). It informs them of the exact amount of income generated from various investments like corporate shares, bonds, and bank accounts held outside of registered accounts.
Common Uses of T5 Slips
Investors use the T5 slip to report the following types of income on their tax returns:
The information on T5 slips ensures accurate taxation on investment income, thus playing a vital role in the completion of an individual's annual tax filing.
Comparative Analysis
This section delves into the specific differences between T3, T4, T4A, and T5 slips, focusing on their issuing bodies, income types they report, and their relevance to different groups of taxpayers.
Differences in Issuing Entities
T3 slips are typically issued by trusts to detail the types of income that beneficiaries receive from the trust. Conversely, T4 slips are provided by employers to their employees to outline employment income, including salaries and wages. The T4A is similar to the T4 but is generally for pension, retirement, annuity, and other income sources, often provided by payers other than standard employers. T5 slips are issued by various entities for investment income, such as interest or dividends.
Variations in Reporting Income Types
Each slip reports on various income types:
Applicability for Taxpayers
The applicability of these slips varies:
Filing Implications
When preparing Canadian tax returns, individuals and entities must be aware of specific deadlines, adhere to compliance requirements, and understand the process for correcting any errors on tax slips such as T3, T4, T4A, and T5.
Deadlines for Each Tax Slip
Penalties for Non-Compliance
Failure to provide these tax slips by the deadline can result in penalties from the Canada Revenue Agency (CRA). The penalty is based on:
Amendment Process for Errors
If an error is found on a tax slip once filed, the issuer must:
Keeping digital records of all tax slips and supporting documents is essential for compliance. Tools like Dext can automatically capture and organize tax documents, reducing the risk of missing a slip at filing time. If you need professional help navigating your tax obligations, our tax compliance services can help.
Utilization in Tax Returns
Canadian tax slips T3, T4, T4A, and T5 are crucial documents for an individual's tax return. Each slip reports different types of income and affects tax calculations in distinct ways.
Incorporating Slips into Tax Return
When a taxpayer is preparing their tax return, they must enter the information from the T3, T4, T4A, and T5 slips accurately. The T4 slip reports the income an individual earned from employment, including taxable benefits, which directly influences the tax liability. It is important to utilize the precise amounts from the T4 slip as they impact the overall income reported.
The T3 slip is used for declaring income from trusts, while the T4A provides information on pension, retirement, annuity, and other income. These slips should be added to other sources of income to form a complete picture of an individual's annual earnings.
Investment income, such as interest and dividends, is reported on the T5 slip. Each slip has its specific line on the tax return form where the corresponding amount must be reported.
Adjustments to Tax Deductions and Credits
Entering information from tax slips may lead to adjustments in tax deductions and credits. Contributions made to an RRSP can be deducted from income, which is typically reported on a T4 or T4A slip. This can lower taxable income and potentially reduce tax liability.
Taxpayers do not need to have earned income to contribute to a TFSA, and contributions are not deductible. Therefore, TFSA contributions do not directly affect the deductions and credits on the taxpayer's return. However, it is important to declare all eligible income and contributions to accurately calculate deductions and credits, which may include education credits, donation credits, or credits for medical expenses.
Issuing the slips: what an employer or corporation has to file
Receiving slips is the easy side. If you run a business, you issue them: a T4 for every employee and a T4A for contractors paid $500 or more, both filed with the CRA and given to the recipient by the last day of February, and a T5 for every dividend your corporation pays its shareholders, on the same deadline. Late or missing slips carry a per-slip penalty, and the CRA matches the totals against your payroll remittances and your T2. The employer side is where payroll software earns its fee: Wagepoint, built in Canada, calculates the deductions every pay, remits to the CRA automatically, and generates and files the T4s and T4 Summary at year-end (a $50 gift card comes with a new account through our link). The T5 for owner dividends is usually prepared by your accountant with the corporate return. Our Canadian payroll software comparison and salary vs dividends guide cover both sides.
Frequently Asked Questions
What is the difference between a T4 and a T4A?
A T4 reports employment income with CPP, EI and income tax withheld; it goes to employees. A T4A reports other amounts paid without those withholdings: self-employed commissions, fees for services, pensions and retirement income, scholarships and RESP payments. A contractor gets a T4A, an employee gets a T4.
What is the difference between a T3 and a T5?
A T5 reports investment income paid directly to you by a corporation or financial institution: dividends and interest. A T3 reports income allocated to you by a trust, which includes most mutual funds and ETFs in a non-registered account, and can contain interest, dividends, capital gains and return of capital. T3s arrive later because trusts have 90 days after their year-end to issue them.
When are T4, T4A, T5 and T3 slips due?
T4, T4A and T5 slips must be filed with the CRA and given to recipients by the last day of February following the calendar year. T3 slips are due 90 days after the trust's tax year-end, which for a December year-end is March 31. Late slips carry a per-slip penalty for the issuer.
Do I need to issue a T4A to a contractor?
Yes, when your business pays an individual or unincorporated contractor $500 or more in a year for services, you report it in box 048 of a T4A, filed by the last day of February. Payments to a corporation are generally not reported on a T4A, except in construction, where the T5018 applies.
Who receives a T5 slip and what does it report?
Anyone paid $50 or more of investment income by a corporation, bank or other payer: dividends from a private or public corporation, interest on deposits and bonds, and certain royalties. Owner-managers who pay themselves dividends receive a T5 from their own corporation.
Can I receive both a T3 and a T5 for the same investment account?
Yes. Interest and dividends paid directly by the issuer arrive on a T5, while distributions from mutual funds and ETFs arrive on a T3, and one brokerage account often produces both plus a T5008 for dispositions. Report each slip where the CRA's matching expects it.
What happens if a slip is wrong or missing?
The issuer files an amended slip and gives you a copy; you report the corrected amount. If a slip never arrives, you must still report the income from your own records, and the CRA will match it against the issuer's filing. Slips also appear in CRA My Account once filed, usually by mid-March.
Sebastien ProstCPA, Ex-CRA
Licensed CPA with 10+ years of experience, including work with the Canada Revenue Agency. Founder of LedgerLogic, a cloud accounting firm serving Canadian SMEs. Xero Certified Advisor.