For small business owners, the General Index of Financial Information (GIFI) is one of the most obvious differences between completing a T1 personal income tax return and a T2 corporate return. So this blog answers some of people’s most common questions about the GIFI. Were you wondering about any of these?
Do I have to use the GIFI?
Yes, if you are running a corporation, unless it’s an insurance corporation.
Even if you are completing and filing a paper version of the T2 corporate tax return, you will be expected to fill out and send along your corporation’s financial statement information using the Canada Revenue Agency’s GIFI forms and schedules.
There is a T2 Short Return – for Eligible Corporations which certain Canadian-controlled private corporations and non-profit corporations can use (see the beginning of the return itself for details), but you still have to complete and file schedules using the GIFI to report your financial information.
And the Canada Revenue Agency (CRA) has now extended the use of the GIFI to partnerships, too. If you look at the General Index of Financial Information (GIFI) Guide, you will see that there are now 28 GIFI codes relating to partnership filing requirements.
Do I have to include my corporation’s financial documents when I file my T2 return?
No. Using the GIFI means that you have already sent your financial information in to the Canada Revenue Agency.
Like all slips, receipts and tax-related documents, however, you will want to keep them for six years, as the Canada Revenue Agency may ask to see them at some point.
What about the notes to my financial statements? Do I need to include them?
- Yes. If you are using tax preparation software, such as TurboTax Business Incorporated, your software will let you send them along electronically.
- If you’re completing and filing a paper T2 tax return, or a T5013 Partnership Information Return, you will need to include a paper copy of your notes as well.
Need an example? See the Canada Revenue Agency’s example of financial statements for a corporation.
How detailed does my GIFI reporting need to be?
As detailed as it gets on your corporation or partnership’s financial statements, according to the Canada Revenue Agency. There is no minimum or maximum number of GIFI codes and entries that they expect to see. “We need as many GIFI codes as it takes to represent your balance sheet and income statement in their entirety,” they say.
Is there a short form of the GIFI?
Yes! But T1178 , General Index of Financial Information – Short, which lets you choose from around one hundred commonly used balance sheet and income statement items, can only be used by corporations that:
- do not use income tax return preparation software, and
- have both gross revenue and assets of less than one million dollars.
For full information about the GIFI, refer to the Canada Revenue Agency’s RC4088- General Index of Financial Information (GIFI).