At some point — whether you're incorporating, registering for GST, or hiring your first employee — you're going to run into the term "Business Number," followed by a two-letter code like RT, RP, RC, or RZ. None of this is explained anywhere in plain language when it happens. You just get a number and are expected to know what to do with it.
Here's the plain-language version.
What Is a Business Number, and Do You Need One?
A Business Number (BN) is a nine-digit number the CRA uses to identify your business. On its own, it doesn't do anything — it's just an ID. What actually matters is which program accounts are attached to it.
A full CRA program account number has three parts:
- Your 9-digit Business Number
- A 2-letter program identifier (RT, RP, RC, RZ, and a few others) showing which type of account it is
- A 4-digit reference number, in case you ever have more than one account of the same type
So a full account number looks like 123456789 RT 0001 — that's Business Number 123456789's first GST/HST account.
Whether you already have a BN depends on your structure. If you incorporate, the CRA typically issues your Business Number and sets up your corporate income tax account (RC) automatically, as part of incorporation. If you're a sole proprietor, you don't get a BN automatically — you get one the first time you actually need a program account, like registering for GST/HST or setting up payroll.
This also matters if you run more than one business. A Business Number is tied to the legal entity, not the business activity. If you're a sole proprietor running two or three different unincorporated businesses, they all share the same BN, because legally, they're all just you. But if you incorporate two separate businesses, each corporation is its own legal entity — so each one gets its own BN, even though you're the person who owns both.
The Four Core Program Accounts
There are more than four program account types in total, but these are the ones almost every small business runs into sooner or later.
RT — GST/HST
This is your GST/HST account — the one you register for once your sales cross the small-supplier threshold (or if you register voluntarily before that). It's the account you use to charge, collect, and remit GST/HST, and to claim back the GST/HST you paid on business purchases.
Sole proprietor or corporation: Applies to both. GST/HST registration is based on your sales volume, not your business structure — a sole proprietor and a corporation follow the exact same rules for whether and when they need an RT account. If you want the full breakdown of those rules, see When Do You Have to Register for GST.
RP — Payroll
This is your payroll account — the one you need if you're deducting and remitting source deductions (CPP, EI, income tax) from anyone's pay, and issuing T4 slips at year end.
Sole proprietor or corporation: Applies to both, but the trigger is different. A sole proprietor doesn't pay themselves a salary — they just draw money out of the business, and that draw isn't run through payroll at all. But if that same sole proprietor hires an employee or apprentice, they need an RP account for that employee's pay, even though the owner's own draws never touch it. A corporation is different: if the owner wants to pay themselves a salary (rather than, or in addition to, dividends), the corporation needs an RP account for the owner too, not just for outside employees.
RC — Corporate Income Tax
This account exists to file and pay corporate income tax on the business's profit.
Sole proprietor or corporation: Corporations only. There's no such thing as an RC account for a sole proprietor — a sole proprietorship isn't a separate legal entity, so it has no separate corporate return to file. Business profit for a sole proprietor is reported on the owner's own personal tax return instead.
RZ — Information Returns
This is the catch-all account for filing information slips — forms that report payments to the CRA without necessarily involving tax withheld at source. Two examples matter most for trades businesses: the T5018, the Statement of Contract Payments, which construction businesses use to report payments made to subcontractors over the year; and the T5, which a corporation issues if it pays dividends to its shareholders.
Sole proprietor or corporation: Applies to both, but for different reasons. The T5018 side can apply to either structure — if your business is in construction and more than half your income comes from construction activities, the CRA's contract payment reporting rules apply whether you're a sole proprietor or incorporated. The T5 side only applies to corporations, since only a corporation can pay dividends. We'll cover the T5018 rules in detail in a future article.
Quick Reference: Who Needs What
| Account | What It's For | Sole Proprietor | Corporation |
|---|---|---|---|
| RT — GST/HST | Charging, collecting, and remitting GST/HST | If sales cross the threshold | If sales cross the threshold |
| RP — Payroll | Remitting source deductions, issuing T4s | Only if you have employees | If you have employees, or pay yourself a salary |
| RC — Corporate Income Tax | Filing and paying tax on business profit | Not applicable | Required |
| RZ — Information Returns | Filing information slips (T5018 for subcontractors, T5 for dividends) | If applicable to your activity (T5018) | If applicable to your activity (T5018), or paying dividends (T5) |
Getting the Right Accounts Set Up From the Start
The most common mistake isn't getting the wrong account — it's not realizing you need one until the CRA flags it. Hiring your first employee without an RP account, or paying subcontractors all year without realizing RZ reporting applies, both create cleanup work that's a lot more expensive than setting the account up correctly the first time.
If you're not sure which accounts your business actually needs, that's exactly the kind of thing worth confirming before it becomes a problem — not after. While you're setting accounts up correctly, it's worth doing the same with your business bank account.
This article is for general informational purposes only and does not constitute legal or tax advice. For guidance specific to your situation, consult a CPA or Canadian tax professional.