When is the government-prescribed rate of interest set?

The CRA’s prescribed interest rates are established for specific periods labelled by calendar quarter (for example, “first calendar quarter 2026”), and CRA publishes the rate schedule by quarter.

This prescribed rate is used in multiple tax contexts, including calculating taxable benefits on certain interest-free or low-interest employee/shareholder loans, and it also relates to interest charged/paid by the CRA on overdue amounts and overpayments (with different rates for different situations).

Because CRA’s publication is organized and effective by quarter (e.g., Jan 1–Mar 31; Apr 1–Jun 30; Jul 1–Sep 30; Oct 1–Dec 31), the correct answer is each calendar quarter (option D), not monthly, semi-annual, or annual.