# CRA Interest Calculation - Overpayment



## bautista99 (Mar 23, 2016)

Hi,

I have a question regarding how interest is calculated using the prescribed rates when remittances have been overpaid. In my scenario, my tax issue was resolved after several years. I can see that for the most part the interest rate is 3%, but is that compounded daily? They calculate daily when you owe money to the CRA but what happens when they owe you?

For example, $10,000 is owed to me, after 5 years, what would my interest be? Is that interest taxable?

Thanks,
David


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## AltaRed (Jun 8, 2009)

From the horse's mouth http://www.cra-arc.gc.ca/tx/bsnss/tpcs/crprtns/pymnts/ntrst/rfnd-eng.html

And yes, interest paid by CRA to you is taxable for the year in which it is paid.


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