When you collect mortgage interest from borrowers and pass it to investors, you are generally the payer of that interest — and responsible for reporting it on T5 slips.
Who needs a T5
If your company pays $50 or more of interest to a Canadian-resident investor in a calendar year, you generally issue that investor a T5 slip and file a T5 information return with CRA. Interest from Canadian sources is reported in box 13.
This commonly applies to mortgage investment corporations, mortgage administrators paying interest out of trust to investors, and private lenders that pay interest to co-lenders or sub-investors. (Dividends paid by a MIC follow their own rules — confirm with your accountant.)
Deadlines
Slips must be sent to recipients, and the return filed, by the last day of February of the following year.
Paid, not earned
T5 reporting follows interest paid or credited in the year. That matters for private lending:
- An investor’s share that was held because a borrower missed a payment is reported in the year it is released, not the year it was earned.
- Interest advanced to investors by the company before the borrower paid is still interest paid to the investor in that year.
- Management or referral fees deducted from an investor’s interest need consistent treatment — agree it with your accountant.
Records you need all year
- Each investor’s legal name, address and SIN or business number (kept securely).
- Every distribution: date, period, interest paid, amounts held and released, fees deducted.
- Sub-investors paid through a head lender, and whether each is paid directly.
Rebuilding this in February from bank statements is where most of the work — and most errors — come from.
How Amortivo handles it
Every distribution in Amortivo records what each lender was paid, held and released. At year end, the T5 preparation summary and draft slips come straight from interest actually paid in the calendar year, with the $50 threshold applied and sensitive identifiers kept encrypted. See investors & distributions.