"Balance owing" on your NOA is CRA telling you that, after they finished assessing your return, you still owe them money. This guide explains what's actually in that number, what interest you're paying, and the four payment methods worth using in 2026.

What "balance owing" actually includes

The balance-owing number on your NOA is rarely just "tax I underpaid." It usually includes a mix of:

• Unpaid federal income tax — the main number
• Unpaid provincial income tax — collected by CRA on behalf of every province except Quebec
• CPP and EI on self-employment income — if you're self-employed, both halves of CPP plus optional EI
• Old balances rolled forward — anything unpaid from prior years, plus accrued interest
• Instalment interest — if last year's tax was over $3,000 and you didn't pay quarterly
• Late-filing penalty — only if you actually filed late (5% of balance + 1% per month)

The breakdown sits in the "Account summary" section on page 1. If your balance owing surprises you, this is the first place to look — usually one of these line items is bigger than you expected.

The 4 ways to pay CRA (ranked by what's actually worth using)

1. Online banking bill payment (best for almost everyone)

Log in to your Canadian bank, go to bill payments, search "CRA" — you'll see options like "CRA Personal Income Tax — 2025 amount owing," "CRA Personal Income Tax — current year payment," and "CRA Tax Instalment." Pick the right one (matters: paying as "current year" when CRA expected it as "amount owing" can land in the wrong bucket).

• Cost: free
• Speed: posts to CRA the next business day
• Use your account number: SIN (no spaces or dashes)

2. CRA My Payment (best for last-minute)

CRA's own portal at canada.ca/cra-my-payment. Accepts Interac Online (most major Canadian banks support it) and Visa Debit / Debit Mastercard. Same-day posting. Use this if you missed the bank cut-off or want immediate confirmation.

• Cost: free
• Speed: posts same day
• Limit: Interac Online may cap at $10,000–$50,000 depending on your bank

3. Pre-authorized debit (best for instalment plans)

Set up through CRA My Account → Proceed to pay → Pre-authorized debit. CRA pulls the amount from your bank account on the date you specify. Useful for instalments and for setting up payment arrangements on a balance.

• Cost: free
• Speed: takes 5 business days to set up the first time
• Useful for: recurring payments without thinking about them

4. Cash or debit at Canada Post (last resort)

Generate a QR code in CRA My Account → Payment options, take it to any Canada Post outlet, pay in cash or with debit. Used by people without bank accounts or by newcomers without online banking set up.

• Cost: $3.95 per transaction up to $1,000, $7.95 over $1,000
• Speed: 3 business days to post

Methods to avoid

• Credit card via PaySimply or Plastiq. 2.5–3% fee. Almost never worth it — CRA's 8% interest is annualized, while the credit card fee is upfront. Math only works if you have a 5%+ category bonus and you'll pay the card off in full immediately.
• Mailing a cheque. Slow, no confirmation, and CRA's mailroom is the most-blamed source of "lost payment" calls. Skip it.
• Wire transfer. Only useful from outside Canada. Domestic wires cost $20+ and post no faster than online banking.

Can't pay the full amount?

CRA's official position: pay what you can by April 30, then call 1-888-863-8657 to set up a payment arrangement for the rest. CRA generally accepts plans up to 12 months without proof of hardship. Plans longer than 12 months trigger a financial questionnaire.

Interest at 8% keeps running during the plan, but the plan prevents enforcement action: wage garnishment, frozen bank accounts, registered liens. Use the income tax calculator to model future-year liability so you can budget the plan size realistically.

What happens if you ignore it

1. Day 1–30: interest accrues at 8%, no other action
2. 30–60 days: collection letter, then collection phone call
3. 60–90 days: requirement to pay sent to your bank or employer (garnishment)
4. 90+ days: registered lien on assets, refund offsets across all benefit programs

CRA's collection powers are unusually strong — they don't need a court order to garnish wages or freeze accounts. Don't ignore the balance, even if you can't pay it.

Bottom line

Pay through online banking the day your NOA arrives — it's free, fast, and reliable. If you can't pay in full, call CRA before they call you and set up a 12-month plan. The 8% interest is annoying but predictable; the enforcement actions you trigger by ignoring CRA are not.

Related reading: NOA line-by-line guide, reassessment vs assessment.

Sources: CRA — Make a payment to CRA, CRA — Prescribed interest rates, CRA — Collections.