Making $70,000 per year in Ontario puts you in the second tax bracket, with an average tax rate of 22.28% and a marginal tax rate of 29.65%. This means:
To break this down further:
So your total deductions are $16,278.41, leaving you with $53,721.59 in take home pay.
Ontario has one of the higher overall tax rates compared to other provinces. For example, if you made $70,000 in Alberta, your total deductions would be $14,402.34 and your take home pay would be $55,597.66.
The lowest taxes on a $70,000 income are in Nunavut, where you'd pay $11,246.79 in total tax and take home $58,753.21.
The above calculation doesn't account for any additional tax credits or deductions you might be eligible for, which would reduce your tax bill and increase your net pay.
Some credits and deductions in Ontario include:
Plugging your full financial situation into tax software will give the most accurate take home pay figure after utilizing all available credits and deductions.
Based on the after-tax income of $54,403.21 per year, your monthly take home pay on a $70k salary works out to $4,533.60.
If you're paid bi-weekly, you'll take home around $2,108.96 per paycheck, assuming 26 pay periods.
In summary, making $70,000 per year in Ontario means taking home about $54,400 after federal, provincial, CPP, and EI deductions. This results in around $4,533 per month in take home pay. Your income tax rate is 22.28% on average but climbs to 29.65% on your highest dollars earned.
For a gross annual salary of $80,000 in Ontario in 2024, the total income tax deduction is estimated to be $20,396, resulting in a net annual take home pay of $59,604, or $4,967 per month.
The average tax rate is 24.9% and the marginal tax rate is 31.5%. This means on average, 24.9% of total income is paid in taxes, while any additional income earned will be taxed at 31.5%.
Specifically, the tax brackets and rates are:
So the $80,000 salary falls within the third tax bracket, with a rate of 11.16% applied.
The total tax deduction of $20,396 is comprised of:
These mandatory payroll deductions reduce taxable income.
Additionally, voluntary Registered Retirement Savings Plan (RRSP) contributions can be deducted to lower taxable income. The maximum deduction is 18% of previous years' earned income.
Compared to other provinces, Ontario has a middle-of-the-pack tax rate on an $80,000 salary. The lowest net income is in Quebec at $56,711 after 29.1% average tax. The highest is in Nova Scotia with a net income of $56,662 after 29.2% tax.
Ontario's net income of $59,604 is higher than any Atlantic province, as well as Manitoba and Saskatchewan. It is moderately lower than Alberta and British Columbia in western Canada.
The average individual income in Ontario in 2021 was $55,300, so an $80,000 salary is 45% higher. Overall, this is considered a good above-average salary.
However, the cost of living, particularly housing, is quite high in cities like Toronto. While definitely a comfortable salary, $80,000 does not qualify as wealthy given the expenses for an individual or family.
Some key reference points for context:
So an $80,000 salary is reasonable to live comfortably by yourself or support a small family, but likely not enough to own a single-family home in Toronto.
There are a few ways to reduce taxes owed on an $80,000 salary in Ontario:
RRSP Contributions: As mentioned, contributing to an RRSP lowers taxable income. At an $80,000 income level, the tax savings from the deduction outweigh the future taxes paid on withdrawals for most people. Maximizing RRSP contributions up to the 18% deduction limit is usually advisable.
Tax-Free Savings Account (TFSA): While TFSA contributions do not reduce taxable income, investment gains and withdrawals are tax-free. This complements RRSPs nicely for retirement savings. The current 2024 TFSA limit is $6,500.
Home Office Expenses: If you work from home, even just part of the time, related expenses like office supplies and internet can be deducted. This further reduces taxable salary income.
Child Care Expenses: Paying for child care also qualifies as a deduction as long as the expenses are incurred to earn employment income. This includes daycare, nanny services, day camps during school breaks, and more.
Moving Expenses: If you have recently moved to start a new job, moving expenses can be deducted in Ontario. This includes transportation, storage, and meals during the move.
Medical Expenses: Unreimbursed medical expenses over 3% of net income can be claimed as a tax credit to reduce taxes payable. Things like dental work, prescriptions, therapy, and more count.
In summary, a gross salary of $80,000 per year results in an average take-home pay of $59,604 after 24.9% tax in Ontario. This places Ontario with moderately high taxes compared to other provinces. To reduce taxes, RRSP contributions, child care deductions, and other tax planning strategies can be utilized. While not considered a luxury salary, $80,000 provides a comfortable living in most of Ontario.
For a $65,000 annual salary in Ontario in 2023, the total income tax and payroll deductions will be about $15,703, leaving a net take home pay of $49,297 per year or $4,108 per month. The marginal tax rate is 35.6% and the average tax rate is 24.16%.
This includes $7,336 in federal tax, $3,705 in provincial tax, $3,659 in Canada Pension Plan (CPP) contributions, and $1,002 in Employment Insurance (EI) premiums.
Here is a breakdown of the major tax and payroll deductions on a $65,000 salary in Ontario:
The average take home pay on a $65,000 salary in Ontario is $49,297 per year or $4,108 per month.
This compares to a take home pay of:
So Ontario has a moderately high income tax rate compared to other Canadian provinces and territories.
Yes, $65,000 is generally considered a good salary in Ontario. It is 14% higher than the average salary in Ontario of around $57,000.
With this salary, you would have a comfortable standard of living in most areas of Ontario. However, in expensive cities like Toronto, housing costs will take up a larger portion of your take home pay.
Some key indicators on a $65,000 salary:
So in summary, $65,000 provides a comfortable life in Ontario with financial flexibility, although high costs of living in cities like Toronto present some limitations.
Ontario has one of the higher personal income tax burdens compared to other Canadian provinces.
For example, on a $65,000 salary, the total income tax in Ontario is $15,703, resulting in an average tax rate of 24.16%.
This compares to:
So a few provinces have marginally lower income taxes than Ontario, while several others are higher. But overall, Ontario ranks among the top third of provinces by tax rates.
Here are some tips to reduce income taxes and maximize your net take home pay on a $65,000 salary in Ontario:
Meeting with a tax professional can also help you create a customized plan to minimize your tax burden.
In summary, a $65,000 annual salary provides a comfortable lifestyle with financial flexibility for most individuals and families in Ontario. After deducting $15,703 in total taxes, the average Ontario resident would take home $49,297 per year or $4,108 per month.
While income taxes are moderately high compared to other provinces, Ontario residents enjoy access to high-quality public services and infrastructure funded by tax dollars. And by taking advantage of all available deductions, credits, and smart tax planning, you can maximize your net income and purchasing power.
An annual salary of $85,000 in Ontario would have the following key tax rates and take home pay:
This results in an average tax rate of 20.14% and a marginal tax rate of 29.65%. The net monthly take home pay is $5,260.
Ontario has a progressive tax system with rates ranging from 5.05% to 13.16%:
An income of $85,000 falls into the 29.65% marginal tax bracket. This means every additional dollar earned above $85,000 would be taxed at 29.65%.
The major deductions that reduce take home pay on $85,000 of income are:
CPP and EI are mandatory payroll deductions that provide retirement, disability, survivor and parental benefits.
Ontario has higher personal income taxes compared to western provinces like Alberta and B.C. but lower than eastern provinces.
For example, on $85,000 of income:
So Ontario ranks in the middle among provinces for income taxes on a salary of $85,000.
Yes, $85,000 represents a well above average salary in Ontario. Some key comparisons:
In high cost areas like Toronto or Ottawa, $85,000 would represent a moderate middle class income. In lower cost areas, it would afford an upper middle class lifestyle.
Overall, $85,000 goes a long way across most of Ontario, allowing someone to live comfortably, though not lavishly.
After taxes and deductions, take home pay on $85,000 works out to $63,122 annually or $5,260 monthly. How far does this get you in terms of lifestyle?
So $85,000 provides a comfortable middle class lifestyle with some nice extras in most of Ontario. Not an extravagant high-flying lifestyle but far from struggling.
Here are some financial planning best practices on an $85,000 household income:
Following these tips will help those earning $85,000 to effectively manage their household finances.
In summary, $85,000 represents an above average salary that affords a comfortable middle class lifestyle across Ontario. Take home pay after taxes is around $63,000. This is enough for nice housing, transportation, entertainment, modest travel, and steady savings and debt reduction. Following sound budgeting and financial planning principles allows someone earning $85,000 to achieve most financial goals and live well.
An individual earning $150,000 in Ontario would face the following tax rates in 2023:
After taking into account tax deductions and credits, the average total tax rate would be approximately 30%, meaning the take home pay would be around $105,000 annually or $8,750 per month.
Specifically, based on the 2023 tax brackets and rates in Ontario, the taxes owed on $150,000 of income would be calculated as:
So the take home pay on $150,000 in Ontario would be approximately $105,000 per year after federal and provincial income taxes.
The main tax deductions that would apply to an individual earning $150,000 in Ontario would include:
Other common deductions like child care expenses, union dues, moving expenses, and certain employment expenses could also apply depending on the individual's personal situation.
Compared to other provinces, Ontario has medium personal income tax rates:
| Province | Tax Rate on $150,000 |
|---|---|
| Alberta | 39.00% |
| British Columbia | 43.70% |
| Manitoba | 46.40% |
| New Brunswick | 53.30% |
| Newfoundland and Labrador | 51.30% |
| Nova Scotia | 54.00% |
| Ontario | 37.16% |
| Prince Edward Island | 51.37% |
| Quebec | 48.22% |
So Ontario has lower total tax rates on $150,000 of income compared to the Atlantic provinces and British Columbia, but is higher than Alberta, Saskatchewan, and Quebec.
Some reasons why Ontario's taxes are moderately high include:
On the other hand, Ontario does not have the highest top marginal tax rates compared to some eastern provinces. It also has lower retail sales taxes than B.C. and the Atlantic region.
Yes, $150,000 per year would be considered an excellent salary in Ontario. Some key points:
So in summary, $150,000 per year would provide a very comfortable lifestyle in Ontario, even after the moderately high income taxes. It puts earners well into the top income brackets provincially and federally. Individuals or households earning this level of income have high levels of discretionary spending available relative to average Ontarians.
A $45,000 annual salary in Ontario results in an average net pay of about $33,261 per year after tax, equaling $2,772 per month. This article will analyze the key details around a $45,000 salary including:
Based on the 2023 tax rates and deductions, someone earning $45,000 in Ontario would pay the following taxes and deductions:
This totals $9,027 in annual deductions, resulting in an average tax rate of 26.1% and a marginal tax rate of 32.0%.
After these deductions, the annual net take-home pay is $33,261, equaling $2,772 per month.
A take-home pay of $33,261 per year or $2,772 per month can provide a moderate standard of living in many areas of Ontario. However, those living in high cost-of-living cities like Toronto may find it more difficult to make ends meet.
Some key considerations on a take-home pay of $2,772 per month:
In summary, a $45,000 salary could provide a comfortable lifestyle in Ontario cities with lower costs of living. But budgeting diligently would be required in high expense areas like Toronto.
When comparing the $45,000 salary to the average and median incomes in Ontario:
In summary, while a $45,000 salary might be considered moderately average for individuals in Ontario, it is below the averages for households. This is an important consideration for supporting a family.
The cost of living in Ontario can vary widely depending on the city. When assessing if a $45,000 annual salary is "good money", cost of living is a key factor.
Some comparisons in major Ontario cities:
Based on these comparisons, a $45,000 annual salary goes significantly further in smaller Ontario cities like Windsor compared to Toronto. The ability to cover basic costs of living on this salary varies widely.
There are some key income tax implications to understand on an Ontario salary of $45,000, including:
Tax Brackets
The $45,000 salary falls into the 15% federal tax bracket and the 5.05% Ontario provincial tax bracket based on 2023 tax rates. No other income would be taxed at higher marginal rates.
Tax Credits
This salary level qualifies for some basic tax credits like the Canada Workers Benefit (CWB). But it does not reach thresholds for higher income credits.
Favorable Dividend Tax Treatment
At this salary level, most dividend income would face a negative tax rate after the Dividend Tax Credit. This provides incentive for dividend investing.
Progressive Tax System
Canada uses a progressive tax system meaning average tax rates increase as income rises. By staying in the lowest federal bracket, average tax rates are minimized.
A $45,000 annual salary in Ontario results in an average take-home pay of about $33,261 per year after tax deductions. This salary represents a moderate income level compared to Ontario averages. However, it may prove more difficult to cover costs of living in expensive cities like Toronto. Careful budgeting is required to manage expenses across housing, food, transportation and savings goals. While not a high income, $45,000 provides a starting point for Canadians to grow their earnings and build financial security over time through budgeting, investing, and advancing their careers whenever possible.
For an annual salary of $130,000 in Ontario, the total income tax and payroll deductions come out to around $39,000, leaving a net take-home pay of about $91,000 per year or $7,600 per month.
The average tax rate is around 30% and the marginal tax rate is 43.41%. This means for every additional $100 earned, $43.41 would go towards taxes, leaving $56.59 in additional net take-home pay.
Here is a breakdown of the different tax rates on $130,000 per year in Ontario:
After taking all these taxes into account, the total deductions come out to about 30% of the gross $130k salary.
The major deductions from a $130k salary in Ontario include:
Total Deductions: $39,050
Net Take-Home Pay = Gross Salary - Total Deductions = $130,000 - $39,050 = $90,950 per year ($7,580 per month)
So after all taxes and deductions, the annual take-home pay on $130k in Ontario works out to approximately $91,000, or around $7,600 per month.
Ontario has moderately high personal income tax rates compared to other Canadian provinces. Alberta and Quebec for example have lower tax rates on the same $130k income:
So Alberta has the highest take-home pay due to lower tax rates, followed by Ontario, and then Quebec. The differences between provinces is largely due to varying provincial tax rates.
A gross salary of $130,000 places someone solidly in the upper-middle class. It is significantly higher than the average salaries in Ontario:
So an income of $130k is considered well above average, and affords an upper-middle class lifestyle in Ontario.
With roughly $7,600 per month in take-home pay at this level, a single individual or couple should be able to live comfortably, although expensive cities like Toronto would have higher costs of living to consider.
Overall though, $130k is considered an objectively good salary, and puts earners in the top 15-20% of income earners in the province. It provides the ability to save and invest, purchase real estate, afford luxuries, and live a comfortable lifestyle. Higher incomes do offer more purchasing power and financial flexibility however.
In summary, $130k represents an above-average salary that places earners firmly in the upper-middle income class in Ontario. It enables a comfortable lifestyle, with the ability to meet all needs and afford some wants. Many would consider $130k a "good" salary, but higher wages do provide greater flexibility and purchasing power.
For a gross annual income of $120,000 in Ontario, total income tax owed is estimated to be around $38,647, including federal tax, provincial tax, Canada Pension Plan (CPP) contributions, and Employment Insurance (EI) premiums. This results in an average tax rate of 32.2% and a marginal tax rate of 43.4% [[1]].
After these taxes and deductions, the annual net take-home pay would be approximately $81,353, which equals $6,779 per month.
The marginal tax rate indicates that any additional income earned will be taxed at 43.4%. For example, a $100 raise would generate $56.59 in net take-home pay after taxes [[1]].
As for bonuses, a $1,000 bonus would result in around $566 of net extra income after tax. Meanwhile, a $5,000 bonus would generate approximately $2,830 in additional net income [[1]].
Some of the most common tax deductions that can be claimed to reduce taxable income in Ontario include:
The more tax deductions that are claimed, the lower the taxable income will be. This helps minimize total income tax owed.
Comparing Ontario to other provinces, it has higher average and marginal tax rates than Alberta, British Columbia, Saskatchewan, and Quebec on a $120,000 salary. However, the take-home pay after tax in Ontario is still competitive.
For example, if the same gross $120,000 salary was earned in Alberta, the net income after tax would be approximately $86,286 per year, or $7,190 per month. So take-home pay is only about $911 higher per year in Alberta than Ontario. The tax rates are more favorable in Alberta, but there is not a massive difference on this income level [[6]].
In the Toronto area specifically, the average total salary is $62,050, so an income of $120,000 is 93.4% higher than the norm [[9]]. The average household income is Toronto is $121,200.
Given the high cost of living in Toronto, a gross salary of $120,000 translates to a decent standard of living. Based on average expenses, the monthly net take-home pay of $6,779 would sufficiently cover costs for an individual like housing, transportation, food, and entertainment in the city [[9]].
However, for larger households supporting children and multiple family members, this salary would provide less breathing room. Individual circumstances determine whether $120,000 constitutes a "good" salary.
But in summary, an income of $120,000 positions someone well above the averages for both individual and household incomes in Toronto. It provides the ability to live comfortably in the city as a single person while affording increased savings and investment opportunities.
Tax rates at both federal and provincial levels have changed over the years in Ontario. Comparing 2023 to 5 years ago in 2018, some of the key tax brackets have increased:
2023 Ontario Tax Brackets [[1]]
2018 Ontario Tax Brackets
While the lowest tax bracket has increased from $42,960 to $49,231, the top brackets have remained unchanged over the past 5 years. Overall, Ontario marginal tax rates are still considered high relative to other parts of North America.
For high income earners like those making $120,000 per year, some tax planning opportunities and savings strategies include:
Proper tax planning for high net worth individuals can lead to substantial tax savings over time. Consulting a certified accountant can reveal tailored opportunities based on your province, career, family status, investments, and other sources of income.
An annual salary of $120,000 in Ontario results in an average tax rate around 32.2% and net take-home pay of approximately $81,353. This provides a healthy income to live in expensive cities like Toronto as a single person or small family, though larger households may find it more challenging.
Tax rates in Ontario remain high compared to other jurisdictions, but have only increased slightly on the low end tax brackets over the past 5 years. Those earning $120,000 have tax planning options to shelter more income from taxes through registered accounts, income splitting, and other strategies. Understanding provincial tax rates and claims available in Ontario is important for high income professionals to minimize their total tax obligations.
A $52,000 annual salary in Ontario translates to a good middle-income salary. As of 2024, it falls under the second federal income tax bracket, between $50,197 and $100,391, taxed at 20.5%. At the provincial level, it falls under the second tax bracket between $46,226 and $92,453, taxed at 9.15%.
After accounting for federal and provincial income taxes, Canada Pension Plan (CPP) contributions, Employment Insurance (EI) premiums, and other deductions, the average Ontario resident will take home about $41,094 per year or $3,424 per month on a gross $52,000 salary.
Below we analyze the key deductions, income taxes, take-home pay, purchasing power, and how $52,000 compares to average and middle-class incomes in Ontario.
There are two main types of income tax rates in Canada's progressive tax system - marginal and average:
While a $52,000 salary falls under the 35.3% marginal tax bracket, the average tax rate is lower at 27.0% because not all income is taxed at the highest marginal rate. The first $50,197 is taxed at just 20.5% federally and 5.05% provincially.
The key deductions from a $52,000 annual salary in Ontario are:
This totals $14,043 in deductions, leaving an after-tax net income of $37,957 per year or $3,163 per month.
Based on the above deductions, the monthly take-home pay on a $52,000 annual salary in Ontario is:
This leaves $3,163 per month for living costs like housing, transportation, food, entertainment, etc. Individual circumstances and lifestyle will determine whether this provides a comfortable living standard.
While a gross income of $52,000 provides a middle-class lifestyle, inflation steadily erodes purchasing power over time.
An individual grossing $52,000 in 2024 would need to earn $56,860 in 2029 just to maintain the same purchasing power, assuming inflation averages 2% per year over that period.
So while $52,000 provides a decent middle-class lifestyle for an individual, it is low compared to average household incomes in the province.
As mentioned earlier, federal and provincial income tax rates in Canada are progressive - higher incomes are taxed at higher rates. In Ontario, the tax rates on a $52,000 salary are:
Federal:
Provincial:
This results in an average tax rate of 27.0% across federal and provincial taxes.
Lower-income Canadians can qualify for tax credits, rebates, and benefits to reduce taxes owed and supplement income []:
However, at $52,000 most credits/benefits start phasing out. An individual would need to earn below $24,000 to gain the full benefit.
The average retirement income in Ontario is about $27,000 per individual []. To maintain a $52,000 income in retirement:
Retirement readiness ultimately comes down to saving early and consistently throughout one's working life.
Given its positioning compared to average incomes and tax rates, a $52,000 salary provides a decent middle-class lifestyle in Ontario. However, it is low compared to average household incomes.
An individual earning $52,000 can afford a comfortable, albeit modest, lifestyle in Ontario. They can afford necessities, some extras like entertainment/vacation, and middle-class housing/transportation with careful budgeting.
However, saving for major goals like retirement or home ownership will require diligent long-term saving and likely dual incomes for those with families.
In summary, a $52,000 annual salary places an individual in Ontario's middle class with a 27% average tax rate and $3,163 in monthly take-home pay. It is comparable to average individual incomes but only half of average household incomes. While providing a comfortable lifestyle, hitting major financial goals will require prudent budgeting and conscious saving over time, especially for those supporting families. Tracking purchasing power and utilizing tax credits provides further financial flexibility.
Based on the provided search results, if you make $55,000 per year living in Ontario, Canada, you will be taxed $15,100 on your income. This includes:
Your total tax represents 27.5% of your income. Your marginal tax rate is 35.5%, meaning any additional income is taxed at that rate. For example, a $100 raise would generate $64.53 in net extra pay after taxes.
With $55,000 in gross salary, your average net take-home pay after taxes will be $39,900 per year or $3,325 per month. This is the amount you receive in your bank account for spending and saving.
There are several types of deductions taken off your $55,000 gross pay:
In total, $12,435 in deductions will be taken from your pay. These deductions help fund important government programs and services.
Ontario has lower income taxes compared to most other provinces. If you made $55,000 in Alberta or Saskatchewan, your total tax would be over $12,600, or over 22% of your income. On the other hand, Ontario taxes represent 27.5% of your $55,000 salary.
Quebec has slightly lower taxes at 27% of income. Provinces in eastern Canada tend to have higher taxes on a $55,000 salary, including over 18% in New Brunswick and over 29% in Newfoundland and Labrador.
So while not the lowest, Ontario does offer reasonably competitive income tax rates compared to other provinces.
Whether $55,000 represents a "good" salary depends greatly on your situation. Here is some context:
So while you can certainly get by on $55,000, it is below average for Toronto standards and may mean living with roommates and budgeting carefully.
In less expensive cities like Ottawa or Brampton, a $55,000 salary goes further. But in Canada's most expensive city, you would likely need over $70,000 to truly feel financially comfortable.
A $55,000 annual salary in Ontario, Canada provides around $39,900 in average net take-home pay after deducting $15,100 in total taxes. This includes federal, provincial, CPP, and EI deductions which help fund public services.
Ontario offers reasonably competitive tax rates compared to other provinces. While $55,000 is below the Toronto average, it can still support living there with careful budgeting and likely roommates. In less costly cities, it provides more comfortable middle-class living.
Whether $55,000 represents a "good" salary requires comparing it to your local cost of living, lifestyle expectations, and career prospects for future raises. But it can certainly provide the basics in Ontario along with some extra for savings and leisure if you live within your means.
An individual earning $48,000 per year in Ontario would fall into the 11.16% tax bracket for 2024. This means they pay 11.16% tax on every dollar earned above $98,463.
When combined with federal taxes, the total tax rate on $48,000 of income is approximately 26.5%, consisting of:
So in total, someone earning $48,000 per year will pay $12,698 in taxes.
After deducting $12,698 in total tax, the take-home pay or net income on a salary of $48,000 per year is $35,302 annually. This works out to $2,942 per month.
Here is the monthly net pay breakdown:
The main deductions from a $48,000 annual salary in Ontario are:
CPP contributions are set at 5.70% for 2024 up to a maximum pensionable earnings of $64,900. EI rates are 1.58% in 2024 on up to a maximum insurable earnings of $60,300.
In addition to tax and these payroll deductions, other common deductions could include group health insurance premiums, union dues, RRSP contributions, and child care expenses.
Compared to other provinces, the total tax rate on $48,000 of income in Ontario is moderately high. Ontario has the 5th highest total tax rate among the provinces.
Provinces with higher total tax rates on $48,000 of income are:
Provinces with lower tax rates on the same income include Alberta (21%), British Columbia (22.39%), and Saskatchewan (24.81%).
So Ontario is certainly not the highest tax jurisdiction in Canada, but is on the higher side.
Whether $48,000 represents a "good" salary really depends on individual circumstances and the local cost of living.
Some key considerations:
The cost of living in Ontario spans a huge range from small rural towns to the Toronto metro area.
Some examples:
So in high cost of living cities like Toronto and Ottawa, a $48,000 income will mean making some sacrifices and budgeting carefully. But in smaller regions with lower costs, it can support a comfortable lifestyle.
In summary, key points on a $48,000 annual salary in Ontario:
Whether or not $48,000 represents a "good" salary depends primarily on the local cost of living. In high cost cities, it will mean making some sacrifices, while in smaller towns it can provide a relatively comfortable standard of living.
The tax rates in Ontario on a $58,000 salary are as follows:
The combined federal and provincial marginal tax rate is 24.15% and the average tax rate is around 16.35% of total income. This means that total income taxes paid on a $58,000 salary in Ontario would be approximately $13,503, resulting in a net take-home pay of $44,497 annually or $3,708 per month.
The main deductions from a $58,000 gross salary in Ontario are:
In total, deductions of around $14,043 would be withheld from a $58,000 salary, leaving the above mentioned take-home pay of $44,497.
Compared to other provinces, Ontario has a middle-of-the-pack tax rate on a $58,000 salary. The combined federal and provincial marginal rate of 24.15% places Ontario 6th highest amongst the provinces.
The highest combined marginal rate is in Nova Scotia at 29.8% and the lowest is in Nunavut at 20.3%. This means someone earning $58,000 would take home $3,317 more by living in Nunavut compared to Ontario.
Some key comparisons:
So Ontario is certainly not the most tax advantageous province for a $58,000 salary but is around average and better than some eastern provinces.
Whether $58,000 represents a good salary in Ontario depends greatly on individual circumstances. But in general, $58,000 would be considered a decent middle-class income, particularly for a single individual.
Some key considerations:
In high-cost areas like Toronto or Ottawa, $58,000 provides a moderate standard of living. In lower-cost regions, it goes much further. Overall, while not a high income, $58,000 represents a solid salary to live comfortably in Ontario for most individuals and couples without children.
In summary, a $58,000 annual salary in Ontario results in around $44,497 in take-home pay after federal and provincial taxes. Tax rates are comparable to other large provinces like B.C. and Alberta.
While not a high income, $58,000 represents a decent middle-class salary in Ontario that allows a single person or childless couple to live comfortably in most cities, with the exception of Toronto where housing costs are high. It provides disposable income similar to the average annual spending needs.
So while $58,000 is not going to lead to lavish vacations or early retirement, it provides a solid standard of living in Canada's most populous province. With careful budgeting, most individuals and families can live well on this modest middle-income salary.
The Canadian tax deadline of May 1, 2023, has now passed. However, if you’ve missed the tax deadline don’t worry, you can still file your return and claim your tax refund.
In this guide, we will cover everything you need to know about filing after the tax deadline.
Can I file my taxes after the Canadian tax deadline?
Yes, filing late is better than not filing at all!
But the answer depends mainly on whether you owe taxes or not.
Every year thousands of people apply for their tax refund after the deadline has passed.
But even if you are not entitled to a refund, it is still very important that you file your documents as soon as possible. If you're late filing and don't owe taxes then you won't pay penalties — but you can still take a financial hit. The government will hang on to any refund until you file a return, and there might also be a delay in getting benefit payouts you're eligible for, such as the GST or Child Tax benefits.
I am due a refund. Will I be fined for filing late?
No, if you are due a refund, there will be no CRA penalty or fine for filing late.
If you worked in Canada in the past ten years, it is possible to claim a refund for these years.
However, it is good not to wait until the last moment because some refundable credits like the EI overpayment are limited to be claimed within 2 years after the end of the tax year.
You may be due a tax refund if you overpaid income tax, overpaid in the Canadian Pension Plan, or overpaid employer insurance.
Most working holidaymakers are entitled to claim something back – so it’s worth investigating how much you’re owed.
Even though there is no fine or penalty the sooner, you file the sooner you receive your money back in your account.
I’m not entitled to a refund. Do I have to file my tax return?
If you owe money to the CRA, you must file as soon as possible.
The CRA charges a late-filing penalty.
Although the CRA is often understanding in cases where income is not reported and it is not unusual for penalties to be waived if you voluntarily disclose previously unreported income.
It is also important to note that even if you could not pay your full balance owing on or before 1 May, it is possible to avoid the late filing penalty by paying the amount you owe before 1 September.
What if I’m self-employed?
Self-employed tax returns are due on June 15, 2023, but any balance owed is due on May 1, 2023.
What Happens if I skip a year filing taxes
If you skip a year of filing and do not owe any money to the CRA, nothing will happen. When filing, it is possible to claim back taxes for up to 10 years.
If you owe taxes to the CRA, you will be charged a late-filing penalty.
If you owe taxes and either don't file a return or don't pay, starting May 1 you'll start racking up penalty charges and daily compound interest on the unpaid amount.
The penalties start at five percent of the amount owing, plus one percent of the balance owing for each full month that the return is late — and compound daily interest is charged on the total amount due. If you file late more than once in four years, the penalties can double.
And if you don't report income twice or more within four years, you can be hit with a "repeated failure to report income" penalty. This penalty is a big one – 20 percent of the total amount of income that was earned and not reported in the most recent year.
How long does it take to process the previous year’s tax returns?
Most Canadian tax refunds are issued anywhere from two to 16 weeks depending on the type of return and when you filed it.
Of course, if the CRA is working through a backlog it will take longer for it to be processed.
How do I file a late return in Canada?
Well, you can file your tax return yourself with the Canadian Authorities.
Alternatively, if you would like help with your tax return, you should contact a tax professional.
Tax professionals will handle all the tricky tax paperwork, ensure you are fully tax compliant, and transfer your maximum refund straight to your bank account.
The average Canadian tax refund is $998 – so it’s definitely worth claiming back what you’re owed.
Can I make installment payments?
Yes, you can pay in installments. Make sure to contact the CRA and explore the various payment arrangements depending on your situation.
Generally, there are 3 ways to pay taxes owed:
Online banking: Set up CRA as a payee on your online banking bill payment service, and use your Social Insurance Number (SIN) as your account number.
CRA My Account: You can make payments directly from your bank account on a set date, and even set up installment payments.
In-person: You can always pay in person at most major banks, just bring along your remittance voucher or original remittance slip.
Choose whatever method you’re most comfortable with!
Can I cancel or waive penalties and interest?
Under certain circumstances, the CRA will consider offering relief. It’s best to acknowledge late or incorrect tax returns, or if your payment is late, as soon as possible with the CRA to see if they can offer options to ease your payment burden.
There are 3 ways you can do this:
As daunting as it can feel, remember that the CRA is on your side and there to help.
Missed the CRA Tax Deadline?
Are you feeling anxious and uncertain about missing the May 1st, 2023 tax filing deadline? If so, rest easy. It happens to the best of us!
It’s never too late to file your return.
If you’ve missed the tax deadline, we’ve got your back even if you’re running a little behind schedule. However, time is of the essence so it’s best to roll up your sleeves and get your tax forms in order as soon as possible.
Feel free to reach out to Filing Taxes at 416-479-8532. Schedule an NTR engagement appointment with us and take the first step toward proper management of your finances.
Disclaimer: The information provided on this page is intended to provide general information. The information does not consider your personal situation and is not intended to be used without consultation from accounting and financial professionals. Salman Rundhawa and Filing Taxes will not be held liable for any problems that arise from the usage of the information provided on this page.
T4 vs T4A – What’s the Confusion?
There is a common confusion each year among business owners as to when to issue a T4 vs T4A. Business owners who employ several individuals may have staff working full-time, part-time, or once-in-a-while. So, to whom do we issue a T4, and to whom a T4A? What’s the difference? How does it impact the employer and those who work for it? Let’s discuss this below.
Employee vs Subcontractor
Determining when to issue a T4 (vs T4A) requires determining whether an individual is an employee vs subcontractor. The following factors come into play to determine if an individual is an employee:
All of the factors above need to be considered, and a subjective determination needs to be made if a worker checks several of the boxes above to be categorized as an employee vs being self-employed.
If the worker is an employee, then the employer needs to follow all the rules applicable to employees in the province they are in, deduct payroll taxes, CPP, and EI, and contribute the employer’s portion of CPP and EI as well.
What does a T4 look like?
Here is what a T4 slip looks like. The Year box indicates the year in which the income was made.
The box with the Employer’s name shows the details of the employer issuing the T4 and the box with the Employee’s name and address should be addressed to the employee.
Important boxes to keep in mind:
What does a T4A look like?
A T4A slip looks very similar to a T4 slip. A T4A is generally issued when the payment is made over $500. It applies in the case of self-employed commission income, pensions, annuities, fees for services, scholarships, and other income.
Similar to the T4 slip, this has the tax year, Payer’s name, and Payee’s details in the recipient’s name and address box.
Did you know?
Employers who do not issue these slips on time will be subject to fines by the CRA.
Maximize Your Tax Return
Our professionals take into account the laws in your jurisdiction, so you get the maximum benefits no matter where in the country you live. If you would like a tax accountant to file your return, book a call with our tax expert to file your taxes from start to finish. Experts at Filing Taxes will be happy to assist you in this pursuit. To speak with an experienced accountant, contact Filing Taxes either at 416-479-8532 or [email protected]. Schedule an NTR engagement appointment with us and take the first step towards proper management of your finances.
Disclaimer: The information provided on this page is intended to provide general information. The information does not consider your personal situation and is not intended to be used without consultation from accounting and financial professionals. Salman Rundhawa and Filing Taxes will not be held liable for any problems that arise from the usage of the information provided on this page.
Planning a staycation in 2022? You can claim a tax credit if you travel to Ontario this year.
Overview
The temporary Ontario Staycation Tax Credit for 2022 aims to encourage Ontario families to explore the province.
Ontario residents can claim 20% of their eligible 2022 accommodation expenses when filing their personal Income Tax and Benefit returns for 2022.
The credit will provide an estimated $270 million in support to about 1.85 million Ontario families.
Who is eligible?
You are eligible to claim the credit if you are an Ontario resident on December 31, 2022.
Only one individual per family can claim the credit for the year. Your claim can include the eligible expenses of your spouse or common-law partner and your eligible children. An eligible child is not entitled to claim the credit on their personal Income Tax and Benefit Return for 2022.
If you do not have a spouse, common-law partner, or eligible child, you can claim your eligible expenses for the credit.
Eligible expenses
You can claim the Ontario Staycation Tax Credit for accommodation expenses for a leisure stay of less than a month in Ontario, at a short-term or camping accommodation, such as a
Short-term accommodation would generally not include timeshare agreements or a stay on a boat, train, or other vehicle that can be self-propelled.
The tax credit only applies to leisure stays between January 1, 2022, and December 31, 2022, regardless of the timing of payment for the stays. The tax credit does not apply to business travel.
The accommodation expenses must also:
As long as all other conditions are met, you can claim any of the following expenses:
How to claim the credit?
You must keep your detailed receipts for any eligible expenses you incur. Those receipts should include at least all of the following information:
You can claim the credit on your personal Income Tax and Benefit Return for 2022.
The Ontario Staycation Tax Credit is a refundable personal income tax credit. This means that if you are eligible, you can get this tax credit regardless of whether you owe income tax for 2022.
Maximize Your Tax Return
Filing Taxes can help you figure out how the staycation tax credits work out in various scenarios. Our professionals take into account the laws in your jurisdiction, so you get the maximum benefits no matter where in the country you live. If you would like a tax accountant to file your return, book a call with our tax expert to file your taxes from start to finish. Experts at Filing Taxes will be happy to assist you in this pursuit. To speak with an experienced accountant, contact Filing Taxes either at 416-479-8532 or [email protected]. Schedule an NTR engagement appointment with us and take the first step towards proper management of your finances.
Disclaimer: The information provided on this page is intended to provide general information. The information does not consider your personal situation and is not intended to be used without consultation from accounting and financial professionals. Salman Rundhawa and Filing Taxes will not be held liable for any problems that arise from the usage of the information provided on this page.
Capital dividends are a special type of dividend that Canadian-controlled private corporations ( CCPC ) can pay to their shareholders on a tax-free basis. The Canada Revenue Agency ( CRA ) uses the capital dividend account ( CDA ) to keep track of the capital dividends that are available to shareholders on a tax-free basis. Capital dividends were created to improve the integration in the Canadian tax system, specifically, capital gains incurred within a corporation will have a similar impact on shareholders as if the shareholders earned the capital gains at a personal level. The tax law relating to capital dividends is complex and our CPA – CA accounting firm based in Edmonton should be consulted if you need further information or wish to claim these types of dividends as we often deal with income tax-related advice to our clients. In this blog post, we will address the most common types of transactions that impact the CDA balance. Our next blog post will include information on less common transactions when tax-free capital dividends can be paid, and additional CDA considerations.
The most common way to increase the CDA balance is through the gain on the sale of capital property (stocks, land, bonds, etc.). A capital gain occurs when the proceeds received on the sale of capital property are higher than the cost of the property, taking into consideration any costs relating to the sale, such as broker and legal fees. Only 50% of a capital gain is added to the CDA balance, which represents the non-taxable portion of the gain. The other 50% of the gain is considered taxable and is included in taxable income for the year. See Year 1 in the example below.
It is important to note that, inversely, losses on the disposal of capital property can decrease the CDA balance. 50% of the capital loss is netted against the capital gain additions and can reduce the CDA balance. Losses on a capital property cannot create a negative CDA balance; rather, the non-deductible portion of the losses is accrued until there are enough non-taxable portions of the capital gains to offset the losses. See Year 2 in the example below.
For the taxable portion of the capital losses, the remaining 50% of the taxable capital loss is applied to the current year's taxable capital gains. If there are no taxable capital gains to apply the taxable capital loss to, the taxable capital losses can be carried forward for future use or carried back 3 years to set against taxable capital gains.
Sales of depreciable capital assets can be more complicated from a CDA perspective as, more often than not, the depreciable property does not increase in value and, therefore, there is normally no capital gain or loss. In those rare cases where the depreciable property does increase in value, complex rules come into play to ensure the correct capital gain versus recapture on depreciation is calculated correctly. As these issues are complex, taxpayers should consult with their tax accountant, preferably one that has a CPA (Chartered Professional Accountant) or CA (Chartered Accountant) designation. Our CPA–CA accounting firm based in Edmonton is highly experienced in income tax matters and would be pleased to assist you in these matters.
Example
For our example, please consider that the corporation is owned by a single individual shareholder, had no other activity for each year, and that the CDA balance starts at zero in Year 1.
Year 1
A stock with a cost base of $100,000 was sold for $500,000, resulting in a capital gain of $400,000. 50% of the capital gain is included in income for tax purposes, and the other 50% of the capital gain is allocated to the CDA balance. The taxable income for the year is $200,000. The closing CDA balance for the year is $200,000. The corporation can pay a $200,000 capital dividend to its shareholder without the shareholder having to pay personal taxes. In our example, the corporation does not pay a capital dividend to its shareholders in Year 1.
Year 2
Land with a cost base of $600,000 was sold for $100,000, resulting in a capital loss of $500,000. Of the $250,000 taxable loss, $200,000 would be carried back to Year 1 and the remaining $50,000 taxable capital loss would be carried forward. The other 50% of the capital loss is allocated to the CDA balance. There would be no taxable income in Year 2 and the CDA balance would be nil as losses on a capital property do not create a negative CDA balance. There is, however, $50,000 in losses accrued ($200,000 gain from Year 1 less $250,000 loss in Year 2) that needs to be offset to bring the CDA balance above nil.
Final Words
Our experienced and professional team at Filing Taxes is here to set you on the right path considering your personal business situation. Feel free to reach out to Filing Taxes at 416-479-8532. Schedule an NTR engagement appointment with us and take the first step towards proper management of your finances.
Disclaimer: The information provided on this page is intended to provide general information. The information does not consider your personal situation and is not intended to be used without consultation from accounting and financial professionals. Salman Rundhawa and Filing Taxes will not be held liable for any problems that arise from the usage of the information provided on this page.
Did you know that some of the costs you incur in connection with relocating to a new job in Canada are tax-deductible?
Moving, in general, comes with a slew of different kinds of anxieties, as well as life changes and often significant monetary expenses. But, if you’re starting a new job in a new place, can you deduct your moving expenses? If so, what can you deduct? This is what we are going to take a closer look at here.
Tax Deductible Moving Expenses: The Basics
You may be qualified for moving expenses tax deductions if you are a Canadian resident who is compelled to change residence owing to a new job or a change in employment location.
There are conditions, of course. The Income Tax Act stipulates that you must relocate at least 40 kilometres closer to your new employment or business location to be eligible for these tax deductions. This could imply relocating to a new province, or you could also be moving within the same province; the only stipulation is that your new location is at least 40 kilometres closer to your new job than your old one.
Here’s an example: Your company is opening a new office in Kitchener, but you currently live in Toronto. As the two are some 80-90 kilometers apart (depending on where in KW you choose to move to) moving to the Waterloo Region will make the most sense, and you'll be able to take advantage of the tax deductions we’ll be discussing here as they apply to you, even though both are in Ontario and often considered reasonably close to one another.
You can claim the moving expenses tax deduction whether you are a homeowner or a tenant—the claims are essentially the same if you meet the requirements. One of the mistakes many people do make is failing to understand that only relocating homeowners are entitled to tax breaks if they make an employment-related move. However, it’s the act of moving – and its many related expenses – that we are talking about here, not the home you are moving to.
What Moving Expenses are Tax Deductible When Relocating for Work?
The following are examples of tax-deductible moving expenses:
It’s worth noting here that if your employer reimburses you for some of your moving expenses, you should keep these in mind when figuring out your deductions, as you can’t claim what someone else ultimately paid!
Tax Tips for Relocating Employees
Figuring out just which moving expenses really qualify can be tricky, and no one wants to get it wrong! Here are some tips to keep in mind.
Tax Tip #1: You don’t need receipts to deduct personal vehicle and dining costs. The cost per kilometre is determined by the region or territory from which you begin your journey. For example, you can deduct 57 cents per kilometre for driving your own car to the new location if you live in Ontario.
You can also deduct $51 per day for each household member for meals consumed during the move, up to a maximum of 15 days. Every year, the CRA adjusts the standardized meal and travel expense amounts.
Tax Tip #2: Each move is considered separately. Even if it happened in the same tax year as the first move, a second move back to your previous location and employer would qualify for moving expenditure tax deductions as well.
Tax Tip #3: If you’re selling your home to move to a new job, deduct the selling costs as moving expenses rather than add them to the home’s cost for capital gains reasons. You will get a better deduction on your income tax return if you do it this way.
Tax Tip #4: The foregoing expenses are not all-inclusive. If you suspect you have extra bills and expenses that may qualify as moving expenses, talk to your accountant.
Tax Tip #5 The Canada Revenue Agency does not allow for the reimbursement of some expenses. The following are some of these limitations:
Final Words
Need more help? To help ensure that you get all the tax breaks you are entitled to while staying on the right side of the CRA, if you have moved for work, let Filing Taxes help you prepare your tax return to ensure you get everything right!
Contact us today and let’s discuss just how we can help you. Filing Taxes concisely deals with several complex issues; it is recommended that accounting, legal, or other appropriate professional advice should be sought before acting upon any of the information contained therein.
Our experienced and professional team at Filing Taxes is here to set you on the right path considering your personal business situation. Feel free to reach out to Filing Taxes at 416-479-8532. Schedule an NTR engagement appointment with us and take the first step towards proper management of your finances.
Disclaimer: The information provided on this page is intended to provide general information. The information does not consider your personal situation and is not intended to be used without consultation from accounting and financial professionals. Salman Rundhawa and Filing Taxes will not be held liable for any problems that arise from the usage of the information provided on this page.
In Canada, tax returns are always filed separately, which means that you and your partner will continue to file individual tax returns. However, if you’re using tax software, you'll have the option of “coupling” the preparation of both returns.
Filing the two individual returns together can help optimize tax returns by identifying ways in which taxes can be reduced and can help maximize the benefits for each couple.
While the process of filing your return doesn’t result in any significant changes, whether you’re married or living common-law, here’s what you need to know about filing your taxes with a partner.
The Basics
If you are newly married or in a common-law relationship, you must notify the Canada Revenue Agency of your status change. If you’re a resident of Québec, you must also notify Revenu Québec.
You're expected to communicate this change by the end of the following month after your status has changed, either through the CRA website, by phone, or by mail. For example, if you got married in June 2022, you're expected to notify the CRA and/or Revenu Québec no later than July 31, 2022.
Tax benefits for couples
It’s important to remember that when you get married or enter into a common-law relationship, the benefit amounts you’re used to receiving may change as they are calculated based on total household income. It could also mean that you become eligible for several credits or benefits you previously weren’t qualified for.
Transferring credits
If you file as a couple, you're entitled to transfer certain credits to your partner, as long as you don’t need them first. These include:
Any amounts transferred from your partner should be calculated on Schedule 2 and entered on line 32600.
Combining credits
As a couple, you're allowed to combine some of your expenses so one spouse can claim the total tax credit.
Pooled credits include:
Tips for couples
So, who is the best person to claim credit? Is that the same person that should claim deductions?
Generally, the partner with a higher income should maximize deductions to reduce paying taxes at a higher rate. On the other hand, the partner with the lowest income should claim credits like the medical expense credits, which are based on a certain dollar amount or percentage of your income.
Wrap Up
Filing Taxes Tax Experts are always here to help you figure out how tax changes will affect your return, and we look forward to helping you.
If you need any advice on tax-saving strategies from an expert tax accountant in Toronto, Mississauga, Oakville, and Hamilton feel free to reach out to Filing Taxes at 416-479-8532. Schedule an NTR engagement appointment with us and take the first step towards proper management of your finances.
Disclaimer: The information provided on this page is intended to provide general information. The information does not consider your personal situation and is not intended to be used without consultation from accounting and financial professionals. Salman Rundhawa and Filing Taxes will not be held liable for any problems that arise from the usage of the information provided on this page.
Are you a newcomer or know someone who is? As a new immigrant, your first year is undoubtedly the hardest as you are adapting to your new environment and learning new aspects of life. Filing taxes is right up there on the list of strange concepts for many – but don’t worry, that’s what we’re here for.
Newcomers are required to file an income tax return, even if they only arrived in Canada in the last few months of the calendar year.
Read this blog to learn more about Canadian taxes and the deductions and credits that are available to you.
Residency Status
As a resident of Canada, you are liable for Canadian income taxes on your worldwide income. You become a resident of Canada for income tax purposes when you establish significant residential ties in Canada. You can usually establish these ties on the date you arrive in Canada.
Significant ties include:
File a Tax Return
As a resident of Canada, you must file a tax return if you:
Even if you have not received income in the year, you have to file a tax return to continue receiving the benefits and credit payments that you are entitled to. The filing due date for personal tax returns is April 30 of the following year.
Complete Your Tax Return
There are three areas on your tax return that must be completed during preparation.
Benefits You Can Claim
Canada Child Benefit:
If you have kids, claim the Canada Child Benefit. This is a tax-free monthly benefit payment made to eligible families to help them with the cost of raising children under 18 years of age. Families with children under age 6 will receive an annual tax-free benefit of up to $6,400 per child. Those with children between the ages of 6 and 17 will receive up to $5,400 annually. Households with children with an annual income below $30,000 will receive the maximum payment.
To apply for the Canada Child Benefit, fill out and send form RC66, Canada Child Benefits Application to the Canada Revenue Agency (CRA).
GST/ HST Credit:
The GST/HST credit is a tax-free quarterly payment that helps individuals and families with low-income offset all or part of the GST/HST that they pay. You no longer have to apply for this credit, the CRA will automatically determine if you are eligible for the credit when you file your next tax return. The credit is determined by the number of children that you have registered for the Canada Child Tax Benefit or the GST/HST credit, and your family net income.
Deductions You Can Claim
RRSP Contributions:
You can deduct contributions made to a Canadian-registered retirement savings plan.
Pension Income Splitting:
If you and your partner were residents of Canada on December 31, 2015, you can elect to split your pension income. To make this election, you and your spouse or common-law partner must complete and attach Form T1032.
Moving Expenses:
Generally, you cannot deduct moving expenses. However, if you entered Canada to attend courses as a full-time student enrolled in a program at an educational institution, and received a taxable Canadian scholarship, you may be eligible to deduct your moving expenses.
Support Payments:
If you make spousal or child support payments, you may be able to deduct the amounts you paid, even if your former spouse or common-law partner does not live in Canada.
Other Deductions:
Wrap Up
Make sure you consider these tips if you are a newcomer to Canada and claim all the tax credits and deductions that are available to you. If you need any advice on tax-saving strategies from an expert tax accountant in Toronto, Mississauga, Oakville, and Hamilton feel free to reach out to Filing Taxes at 416-479-8532. Schedule an NTR engagement appointment with us and take the first step towards proper management of your finances.
Disclaimer: The information provided on this page is intended to provide general information. The information does not consider your personal situation and is not intended to be used without consultation from accounting and financial professionals. Salman Rundhawa and Filing Taxes will not be held liable for any problems that arise from the usage of the information provided on this page.
The Canada Emergency Student Benefit, or CESB, is student-centric financial relief amid the COVID-19 pandemic.
To offer financial support to post-secondary students and recent grads who lost work opportunities due to COVID-19, the government has introduced the Canada Emergency Student Benefit (CESB) a $1,250 a-month taxable benefit available for up to 24 weeks. -The Canada Emergency Student Benefit is a Government of Canada program.
This benefit is for students who do not qualify for the Canada Emergency Response Benefit (CERB) or Employment Insurance (EI).
Who Can Apply?
If you can work, you must be actively looking for work to be eligible to receive the CESB. If you still cannot find work due to COVID-19, you can re-apply for each CESB eligibility period that you are eligible for. You cannot apply for the CESB if you already applied for the CERB or EI. If you have already applied, or are receiving support from the Canada Emergency Response Benefit (CERB) or Employment Insurance (EI) you are not eligible to apply for the CESB.
Eligibility
Check the below to see if you are eligible for the CESB:
You are one of the following:
One of the following applies:
The government says students should keep records of their daily job search activities to verify they have been looking for work during the eligibility period(s) they applied for. They recommend registering with the Government of Canada Job Bank.
What are the eligibility periods?
| Eligibility period | Amount (depending on eligibility) |
| May 10 to June 6, 2020 | $1,250 or $2,000 |
| June 7 to July 4, 2020 | $1,250 or $2,000 |
| July 5 to August 1, 2020 | $1,250 or $2,000 |
| August 2 to August 29, 2020 | $1,250 or $2,000 |
Applicants can only apply for one eligibility period at a time. If their situation continues, they must re-apply for another 4-week eligibility period.
Eligibility conditions for the benefit top-up
If you meet all of the conditions above, you may also be eligible for an extra $750 every 4 weeks.
Additional support is available if at least one of the following applies:
Verifying your eligibility
The Canada Revenue Agency (CRA) will verify your eligibility to receive the CESB after you have applied. The CRA may ask you to provide supporting documents to confirm your eligibility at a later date. If we find that you are not eligible, we will contact you to make arrangements to repay any amounts you may owe.
Which periods you can apply for?
Each eligibility period is 4 weeks period with a specific start and end date. When you apply, you will receive a payment for the specific eligibility period you applied for.
You can only apply for one eligibility period at a time. If your situation continues, you must re-apply for another 4-week eligibility period.
How do students apply?
The benefit will be administered by the Canada Revenue Agency.
Students can apply through CRA My Account.
If they have not filed taxes before, they must call 1-800-959-8281 to register their Social Insurance Number (SIN) with the CRA.
They can also apply by calling 1-800-959-2019 or 1-800-959-2041 and following the instructions. They must have their SIN and eligibility periods ready.
Call the CESB general line for questions about:
Call the CRA’s general inquiries line for questions specific to your account information, including if you are:
Before you call:
To verify your identity, you’ll need your:
The government recommends students set up direct deposits through CRA My Account or through their financial institution to receive the payments sooner. They should receive a payment within 3 business days.
CESB FAQs
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If you still have unanswered questions:
These are complicated and potentially stressful times; if you have further questions, we suggest contacting the Filing Taxes team of professional accountants today at 416-479-8532. Schedule an NTR engagement appointment with us and take the first step towards proper management of your finances.
Disclaimer: The information provided on this page is intended to provide general information. The information does not consider your personal situation and is not intended to be used without consultation from accounting and financial professionals. Salman Rundhawa and Filing Taxes will not be held liable for any problems that arise from the usage of the information provided on this page.
One of the most important things to remember as a taxpayer is the deadlines for filing your taxes. The Canada Revenue Agency sets strict due dates for returns and payments. Filing your return on time helps you avoid any interest or penalties and get your refund earlier. We’ve rounded up all the major dates that matter for your taxes to make this season stress-free.
When Can I File My Taxes in 2024??
Tax Filing Deadline for Individual Tax Returns
The tax filing deadline for your 2023 tax return is April 30, 2023.
The Canada Revenue Agency usually expects individual taxpayers to submit their income tax returns by April 30 of every year. If April 30 falls on a weekend, the CRA extends the deadline to the following business day.
If you want to file early, the CRA will open its NETFILE service on February 21st to electronically receive submitted returns
Mailed responses must be received or postmarked by the due date, and electronically submitted returns must be submitted by midnight local time on the date they are due.
Tax Filing Deadline for Self-Employed Tax Returns
If you are self-employed, the CRA gives you a bit longer to submit your income tax return — you do not have to submit it until June 15, 2022. This means you are not liable for the late-filing penalty, but CRA will begin assessing interest on any unpaid amounts owing for the tax year starting May 3, 2022.
Important CRA dates and deadlines in 2024
| Date | Event |
|---|---|
| January 10 | Deadline for payment of prior year's Canada Pension Plan (CPP) contributions and Employment Insurance (EI) premiums for self-employed individuals |
| January 16 | Fourth Quarter Projected Tax Payment Due |
| January 23 | Start of Federal Tax Return Processing for 2023 |
| January 31 | Deadline for Employers to Submit W-2 Forms |
| January 31 | Distribution of Some 1099 Forms |
| February 15 | Exemption from Withholding Becomes Available |
| February 15 | Deadline for filing an extension request if you're unable to file your personal income tax return by the regular deadline |
| March 15 | Due date for filing personal income tax returns for individuals and families |
| March 15 | Deadline for payment of prior year's taxes or installments for self-employed individuals and corporations |
| April 1 | Minimum Distribution Required for Those Turning 73 in 2023 |
| April 15 | Tax Day (unless extended due to local state holiday) |
| April 30 | Deadline for filing personal income tax returns for individuals and families (regular deadline) |
| April 30 | Deadline for payment of prior year's taxes or installments for individuals and families |
| June 15 | Deadline for filing personal income tax returns for individuals and families (extended deadline) |
| June 15 | Deadline for payment of prior year's taxes or installments for individuals and families (extended deadline) |
| June 17 | Due Date for Second Quarter Estimated Taxes for 2024 |
| September 16 | Due Date for Third Quarter Estimated Taxes for 2024 |
| October 15 | Deadline for Filing Extended Tax Returns for 2023 |
| December 12 | Due date for filing T2 corporation income tax returns for the fiscal year ended June 30, 2024 |
| December 13 | Due date for fourth-quarter estimated taxes for 2024 |
| December 31 | Required Minimum Payments for Those Aged 73 and Older |
| January 15, 2025 | Deadline for Fourth Quarter Estimated Taxes for 2024 |
Tax Filing Deadline for Business Tax Returns
The CRA requires most business owners (Sole-Proprietors or Partnerships) to submit their returns by May 2, 2022, if their business fiscal year matches the calendar year. However, some businesses may opt to observe a non-calendar fiscal year, and if they do, their returns are due six months after the end of their fiscal year.
Tax Filing Deadlines for Final Tax Returns
If you are the legal representative of a deceased person, you are in charge of ensuring their final tax return is submitted to the CRA.
Again, if the deceased person or their spouse or common-law partner is self-employed, the CRA extends the due date to June 15, but it still begins assessing interest as of April 30.
GST/HST Filing Deadline
If you are a self-employed GST/HST Registrant, you will need to file a GST/HST Return regularly, even if you have no income to report. GST/HST registrants have “reporting periods” which are monthly, quarterly, or annually. Monthly and quarterly filers must file the return and payment one month after the end of the reporting period. Annual filers have until June 15 of the year following the tax year for which the return is being filed.
Deadlines for Employers
If you hire an employee, you have to have your employee complete a TD1 form within seven days of being hired. You also have to send your employee a T4 information slip by the last day of February following the year to which the information slips apply.
Finally, if you go out of business, the CRA requires you to submit your final CPP contributions, EI premiums, and income tax deductions (payroll remittances or source deductions) within seven days of closing your doors. It also requires you to submit any T4 slips as well as a T4 Summary and file it within 90 days.
Due Dates for Installment Payments
If you make installment payments throughout the year so that you can avoid a large bill at tax time, you have four due dates throughout the year. Whether you are self-employed or employed by someone else, you must submit your installment payments by March 15, June 15, September 15, and December 15 of each year.
Tracking Due Dates
To help you stay on top of filing due dates, the CRA has a mobile app. You can download it for free and set reminders for the dates that apply to you. Additionally, you can check on extensions to the usual due dates.
Final Words
If you haven’t filed your taxes in a while, get started today to avoid these potential consequences. For advice and assistance with tax planning, a CRA tax dispute, or other tax issues, get in touch with Filing Taxes today to see how we can help. Experts at Filing Taxes will be happy to assist business owners in this pursuit. To speak with an experienced accountant, contact Filing Taxes either at 416-479-8532 or [email protected]. Schedule an NTR engagement appointment with us and take the first step towards proper management of your finances.
Disclaimer: The information provided on this page is intended to provide general information. The information does not consider your personal situation and is not intended to be used without consultation from accounting and financial professionals. Salman Rundhawa and Filing Taxes will not be held liable for any problems that arise from the usage of the information provided on this page.
The Old Age Security (OAS) pension is one of three main retirement income sources for seniors in Canada. It is designed to help seniors meet their income needs in retirement.
OAS is a monthly benefit available to anyone age 65 or older.
If you happen to be a senior whose income is below a certain amount, the OAS will also include the Guaranteed Income Supplement (GIS).
As part of your retirement income with the Canada Pension Plan (CPP), it’s important to understand how much OAS you’ll receive so you can be confident you’ll have enough retirement income.
Like the Canada Pension Plan (CPP), OAS is paid out to eligible recipients once every month, with direct deposits hitting your bank account on specific dates.
Unlike the CPP, you don’t need to make any contributions during your working years to qualify for the OAS pension.
To qualify for the OAS, you must be at least 65 years of age and resident in Canada at the time when your application is approved. You must also have lived in Canada for at least 10 years.
OAS recipients who currently live abroad may qualify if they meet the age requirement and were citizens or legal residents before leaving Canada.
They must also have lived in Canada for at least 20 years since the age of 18.
If you don’t meet these requirements, you may still qualify for OAS if you lived in a country that has a social security agreement with Canada and made contributions to that country’s social security system.
You receive the full OAS pension amount if you have lived in Canada for at least 40 years since turning 18.
If you have lived in Canada for less than 40 years as an adult, you get a partial benefit based on how long you have resided in Canada.
For example, if you lived in Canada for 30 years after age 18, you get 30/40th of the maximum benefit which is equivalent to $481.87 (i.e. $642.25 x 75%).
You can increase the OAS pension amount you qualify for by delaying your first payment past age 65.
OAS pension can be deferred for up to 5 years until age 70. For every month you delay, your pension payment increases by 0.60% for a maximum increase of 36% by age 70.
The maximum monthly OAS payment in 2024 is $778.45.
This amount is revised every quarter in January, April, July, and October to account for increases in the cost of living.
For example, the OAS amount increased in the January to March 2024 quarter to reflect an increase in the Consumer Price Index (CPI).
Your OAS pension benefit is paid into your bank account on these dates in 2024:
If you haven’t yet set up a direct deposit and currently get your benefits by cheque, it may arrive on or after these dates.
Note that the Federal government is switching from cheques to direct deposit for all payments and benefits.
You can set up direct payments to a bank in Canada by calling 1-800-277-9914 or online through your My Service Canada Account.
For foreign banks, complete the foreign direct deposit enrolment form
Service Canada may automatically enroll you for OAS or send you a letter asking you to apply.
If you haven’t received notification that you are enrolled after turning 64, you can apply online through My Service Canada Account or complete the paper application (Form ISP-3550) and mail it to the nearest Service Canada Centre.
For questions about your OAS benefit, contact Service Canada at 1-800-277-9914 or TTY at 1-800-255-4786.
In some cases, Service Canada will be able to automatically enroll you for the OAS pension. In other cases, you will have to apply for the Old Age Security pension. Service Canada will inform you if you have been automatically enrolled.
In most cases, you do not have to apply to get this benefit.
OAS pension benefits are taxable, and you should report them on your annual income tax return.
The tax you pay depends on your income tax bracket.
You can ask the CRA to withhold taxes at the source every month or pay quarterly. You can have income tax automatically deducted from your OAS payments to help eliminate big surprises at tax time.
Lower-income seniors may also qualify for the Guaranteed Income Supplement (GIS). This tax-free monthly benefit increases their income so they can afford day-to-day living expenses.
The maximum monthly GIS amount in 2024 is $1,057.01 and GIS payments vary based on your marital status and income.
Seniors ages 60-64 years who are married (or common-law partners) to a GIS recipient may qualify for the Allowance benefit.
The maximum Allowance amount in 2024 is $1,292.61.
Lastly, if you are a low-income senior between ages 60 and 64 and your partner or spouse has died, you may qualify for the Allowance for the Survivor benefit.
The maximum Allowance for the Survivor amount in 2024 is $$1,524.70.
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Professional accountants at Filing Taxes can help you
If you have more concerns about the Old Age Security Program don’t hesitate to contact the Filing Taxes team of professional accountants today at 416-479-8532. Schedule an NTR engagement appointment with us and take the first step towards proper management of your finances.
Disclaimer: The information provided on this page is intended to provide general information. The information does not consider your personal situation and is not intended to be used without consultation from accounting and financial professionals. Salman Rundhawa and Filing Taxes will not be held liable for any problems that arise from the usage of the information provided on this page.
The T1 taxpayer's form is also known as the Income Tax and Benefit Return. Here is an overview of everything Canadians need to know about the T1 form, including who should fill it out, where to get it, and its various sections.
What Is a T1 Form?
The T1 form is a summary of all income taxes you pay to the CRA. All Canadians are required to fill and submit this form, which also declares all income you have generated for the specified calendar year. Think of the T1 as a kind of summary of all the other forms you complete for your income taxes, as well as all the information required to file.
You need the T1 form to apply for various services like the Canada Child benefit, GST/HST refundable tax credits, and other benefits. You may also be required to provide the T1 general income form when applying for major credits, such as a mortgage.
Who Should Fill Out a T1?
Every Canadian has to file a T1 every year. Business owners, such as sole proprietors and partnerships, are also required to complete the T1 business form. However, if you are a corporation, you should complete the T2 which is provided for corporate income.
How Do I Get a T1 Online?
There are various places to get a copy of the CRA T1 form. The easiest way to get your T1 is online.
If you have a CRA My Account, you can find your T1 for the current year, as well as the past 11 years that you filed, by looking under the “tax returns view” section. If you look for anything older, you will need to contact the CRA directly at 1-800-959-8281 to request a copy.
You can also conveniently complete your T1 tax returns through tax preparers and certified tax calculators. These tax forms are named after the calendar years they are required for, so you should use the 2022 T1 form to report personal income for the 2022 tax year.
How to Calculate Income?
There are three main parts to calculating your taxable income for the T1 form. These include:
The gross income refers to the sum of all wages, salaries, profits, interest payments, rents, and other forms of earnings, before any deductions or taxes.
Once you have the gross income, you should subtract the cost of goods sold, as well as any expenses, depreciation and amortization, interest, and taxes, to find your net income, also known as your profit.
The last step involves subtracting other allowable expenses from your net income. The CRA allows you to deduct various expenses, including rent, utility bills, the business use of a car, and other amounts. Travel expenses, bonuses offered to employees, and other costs of running your business are generally considered allowed expenses you can subtract from your net income, pending taxation. The final amount you’re left with represents your taxable income.
T1 Breakdown
| Section | Meaning |
|---|---|
| Identification | In this section, you provide details such as your name, address, social insurance number, and marital status. If you have a business, you will be required to fill out the business identification section. Taxpayers with multiple businesses must fill out a separate T2125 form. |
| Total Income | Here you declare all your income sources, including income from employment, self-employment, foreign income, disability benefits, and more. This is also known as your gross income. |
| Net Income | This is the amount you're left with after expenses are subtracted from the total income. You can deduct various allowable expenses from your total income, so you should check for the ones you are allowed to remove from the taxable income on the CRA site. |
| Taxable Income | The CRA allows you to subtract other amounts, such as capital losses, from your net income. The taxable income refers to the final amount you get after all allowed deductions have been made. It is the income CRA will tax using existing rates for the calendar year. |
| Refund or Balance Owing | This section is where you determine if you are eligible to get some money back or are required to pay more. A positive number in this section implies you owe CRA money while a negative number means you will receive a refund. |
The T1 general income tax isn't as elaborate as others. It also uses entries from other taxpayer forms and has five main parts to fill. These include:
Where Do I Send My T1?
Online form submission is facilitated using NETFILE, the CRA-recommended service for submitting CRA-issued taxpayer forms. You can also download the PDF form, fill and mail it to CRA offices in your province.
When to Submit and Pay for T1
Canadian taxpayers are required to file the T1 by April 30. T1 submissions follow the general calendar year. If you want to file the T1 for the 2022 tax year, you have until April 30, 2022, to submit the income statement.
Final Words
Hopefully, you now have a better understanding of your personal tax return. Our experienced and professional team at Filing Taxes is here to set you on the right path considering your personal business situation. Feel free to reach out to Filing Taxes at 416-479-8532. Schedule an NTR engagement appointment with us and take the first step towards proper management of your finances.
Disclaimer: The information provided on this page is intended to provide general information. The information does not consider your personal situation and is not intended to be used without consultation from accounting and financial professionals. Salman Rundhawa and Filing Taxes will not be held liable for any problems that arise from the usage of the information provided on this page.
When the government deposits money into your bank account, it’s filed under a series of different codes. One of them is “Canada Fed”, a deposit you may notice when you review your bank statement. As with any deposit, it’s important to know where it came from to determine if the money belongs to you and how it factors into your budget. The Canada Federal Deposit covers many different programs.
In this article, we detail everything you need to know about federal deposits, including payment dates, and eligibility requirements.
Canada Fed deposit is a direct deposit from Canada Revenue Agency (CRA) on behalf of the federal government and gets handled separately from any provincial financial incentives. The Canadian government also issues out several direct deposits with unclear and often vague descriptions. The Canada Fed deposit is one of them. It could be one or a combination of benefit payments made by the Government of Canada. Payments issued with the caption can be rebates, credits, or one of the benefits administered by CRA. Canada FED also sometimes refers to energy rebates from the Government of Canada.
The main objective of this Canada Fed deposit is to improve the purchasing power of low-medium-income Canadians through tax rebates or credits.
Consequently, eligible persons are not taxed upon receiving this deposit, except for the Canada Workers Benefit (CWB) deposit.
This is the major thing pro about the Canada Fed deposit. Unlike other government deposits, you have the flexibility to spend this payment without worrying about taxes.
Canada FED deposits are tax-free payments by the Canada Revenue Agency (CRA) that include:
To receive these deposits, you must be eligible for one or more of the programs listed above. In most cases, you automatically apply when you file your annual income tax return. The amount for which you qualify changes yearly, and each individual program has unique criteria to participate.
The Canada Fed Deposit is simply a term used in payroll software and bank statements. It represents the money deposited into your account from one or more of the programs. Some individuals qualify for all three programs, while others are only able to access certain benefits.
It’s important to know which of these programs your qualify for so you know how to handle the money for tax purposes.
CCB was designed to help families with the cost of raising their children. It is administered by CRA and provides a tax-free, monthly payment to eligible families with children below age 18. In addition, families may also receive related provincial benefits where applicable.
You can apply for the CCB as soon as your child is born when registering their birth, through your CRA My Account, or by mail.
How much you receive is dependent on how many eligible kids you have and your adjusted family net income for the last tax year. CCB payments are reassessed each year based on your family net income and are indexed to inflation.
Classed either as the goods and services tax or the harmonized sales tax credit, this payment is an equalization amount meant to ensure that tax is only paid once on goods and services. The difference between HST and GST is strictly based on your province of residence. Depending on your province/territory, you may benefit from other provincial/territorial programs under the GST/HST deposit.
The goods and services tax/harmonized sales tax (GST/HST) credit is a quarterly payment to individuals and families with low to modest income. That said, your family income, the number of registered children, and your previous tax return determine how much GST/HST credit you receive.
It is a tax-free payment that is designed to offset or compensate for some of the sales taxes that Canadians pay through GST and HST.
Your GST/HST credit is calculated using the previous year’s net income and paid to start in July till April of the following year.
For example, the GST credit that’ll start going out from July 2021 11is calculated using the net income reported on the 2020 income tax returns.
The Canada Workers Benefit is available to Canadians with medium-low-income. It differs from the other two Canada Fed credits significantly in that it is taxable income. This means that the amount you collect from the benefit adds to your tax bracket calculations. It also means that you owe taxes on the money the program deposits. To enroll in the CWB, you must file your income tax return.
CWB Disability Supplement
If you are eligible for the Canada Workers Benefit, you may also be eligible for an additional disability supplement of up to $713 per year, if you:
Already receive the Disability Tax Credit
Have a minimum employment income of $1,150 (for most provinces)
Have filled out a Disability Tax Credit Certificate (Form T2201)
As I mentioned earlier, the federal payment is administered by the CRA to eligible Canadians under the CCB, GST/HST, and CWB programs.
So to be eligible for the federal payment, an individual must meet the requirements of any of the above programs.
However, each of the above programs has different requirements, but it’s not surprising to qualify for all of them.
Here are the common requirements for the CCB, GST/HST, and CWB programs:
Though all three of the programs included in this deposit category are for those with medium-low-income, other factors also contribute to eligibility. These differ slightly for each program. To maximize your benefits, understanding how to qualify is important.
To be eligible for the Canada Child Benefit, the household must meet the following criteria:
When you file your income taxes for the year, you are automatically enrolled in this program. The government has centralized payments via direct deposit, so you can track these in your CRA portal.
Every taxpayer is technically eligible for this benefit by virtue of paying taxes. However, the actual amount of the benefit deposit varies based on the following criteria:
The Canada Revenue Agency calculates your eligibility regularly, so if you have a change in circumstances, inform them promptly to avoid payment issues.
Because this benefit differs from the other two due to its taxable status, the criteria are unique. You must:
Those with spouses or common-law arrangements have an extra eligibility burden, where you must:
If the household supports dependents, they must:
DISQUALIFYING FACTORS:
Provided you meet the above requirements, and don’t have one of the disqualifying traits, then you can easily access this benefit.
When a child is younger than six, you can get up to $6,765. This amount drops to a maximum of $5,708 per year until the child reaches the age of majority. There are other benefits in the same category as the CCB, including child disability benefits. Though it is technically a provincial/territorial benefit, the funding moves through the federal program and can show up as CCB or Fed.
As with the other programs, it’s designed for medium-low-income households. Accordingly, the exact amount you receive varies based on your earnings for the previous years., Your household size also gets taken into account. For the current benefit period (July 2023 – June 2024), the maximum GST/HST credit is up to:
The program has two components, the basic amount and the disability payment. Single individuals without children are eligible for as much as $24,573 if they live in any of these provinces or territories:
Conversely, if you live in one of the following areas, you have different eligibility:
Depending on the amount you can receive, you will either get a quarterly payment or a lump sum amount.
The amount of Canadian Fed deposit you get depends on how many programs you qualify for and your situation.
Since the Fed deposit comprises three programs, you should expect to receive each deposit on different dates.
However, GST/HST and CWB advance payments are made quarterly. But you can choose to receive a one lump-sum CWB payment during tax periods.
That said, the table below shows the different dates for CCB, GST/HST, and CWB advance payment for 2024:
| Canada Child Benefits (CCB) | GST/HST Tax Credit Payments | Canada Workers Benefit (CWB) |
| January 19, 2024 | January 5, 2024 | January 12, 2024 |
| February 20, 2024 | April 5, 2024 | April 12, 2024 |
| March 20, 2024 | July 5, 2024 | July 12, 2024 |
| April 19, 2024 | October 4, 2024 | October 12, 2024 |
| May 17, 2024 | ||
| June 20, 2024 | ||
| July 19, 2024 | ||
| August 20, 2024 | ||
| September 20, 2024 | ||
| October 18, 2024 | ||
| November 20, 2024 | ||
| December 13, 2024 |
If you want to avoid trouble in the long run, you should ascertain the purpose of the Canada Fed bank deposit immediately after receiving it.
Occasionally, the federal government makes wrong deposits. Although it’s not your fault, you may put yourself in serious trouble if you fail to inform them about the wrong deposits.
Thus, to validate the purpose of the Fed deposit, log in to your CRA My Account. This is where you will find all notices concerning your eligible credits and payment dates.
However, you may go to the message area to check whether the CRA has sent you any message regarding the Fed deposit.
If you have not received any notice or message regarding the Fed deposit and are not qualified for either CCB, GST/HST, or CWB credit, reach out to the CRA immediately.
Moreover, you’re free to spend the Fed deposit if you meet the requirements for the CCB, GST/HST, or CWB credit and find a notification or a message about the deposit on your CRA My Account.
There are multiple government deposits; for ease of budget tracking for both the government and the recipient, there are different codes. If you qualify for the Fed deposit, you likely will encounter one of the following bank deposits as well:
Short for the Canada Refund Income Tax (Canada RIT) is issued by Revenue Canada to those who receive a tax return. It arrives somewhere between one to six weeks after you file your annual income tax return. If the government reassesses your tax return, you may receive this credit at a random time. Check your online portal to make sure you are entitled to it. Since the credit is tax-free, it neither adds to your tax bracket nor do you have to pay tax on it.
For residents of Alberta and Ontario, you can qualify for this benefit. It is income-based, where the amount is calculated when you file your taxes. If it doesn’t show up as a Canada Pro deposit, will likely show up as one of two statement codes:
Families with children under age 18 years of age who are eligible for the CCB and Disability Tax Credit (DTC) may qualify for additional monthly Canada Fed payments.
The maximum CDB is paid per child when your adjusted family net income is $69,395 or less.
Now you have a clear picture of what the Canada Fed payment on your bank account entails.
Also, you know why it’s essential to confirm the purpose of the deposit on your CRA My Account before spending it.
Ensure that you’re really eligible for this deposit, else those few hundreds or thousands of dollars may put you into a costly problem. Getting an unexpected payment that’s rightfully yours? Wonderful. Not actually being entitled to that amount. Less so. The key takeaway about any type of deposit is that you must check that it is rightfully yours. When the money is in your account, it’s your responsibility. This could mean anything from getting an overpayment, spending it, then having to repay it to simply paying taxes on the benefit.
There are plenty of government assistance programs available for Canadians to get financial support. As long as you qualify, most of the application comes when you file your taxes. Provided you are prudent about record-keeping and tax savings, you can use these Canada Fed deposits to strengthen your finances. Furthermore, other federal government deposits such as Canada RIT and Canada Pro can add up to building your long-term financial security.
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If you have more questions about the Canada Fed deposit, give a call to CRA at 1800-959-8281. For other information, contact the Filing Taxes team of professional accountants today. Schedule an NTR engagement appointment with us and take the first step towards proper management of your finances.
Disclaimer: The information provided on this page is intended to provide general information. The information does not consider your personal situation and is not intended to be used without consultation from accounting and financial professionals. Salman Rundhawa and Filing Taxes will not be held liable for any problems that arise from the usage of the information provided on this page.
As the tax season approaches, it is critical to recognize the key files you will get from the Canada Revenue Agency (CRA) following the filing of your tax return. The Notice of Assessment (NOA) and the T1 General are two of the maximum important documents. The NOA gives the quantity of tax which you owe or the refund you will get hold of based totally at the info that you have provided for your tax return. Meanwhile, to calculate your tax liability T1 general is the primary document. In this article, we will discuss an overview of both the NOA and T1 General, which includes their purpose, difference, and their importance.
A note from Canada Revenue Agency (CRA) is acquired after the submission of the Tax go back. This is known as a Notice of Assessment (NOA) which covers the tax amount required to be paid or any refund amount you're eligible to get hold of. The NOA summarizes your tax go back information, i.e. Your income, deductions and credits in conjunction with any amendments made by CRA. It is a confirmation by CRA that the tax return has been received and processed accurately. OA can utilize as evidence of tax return status for applications for loans or mortgages. NOA can be obtained on the CRA’s my account service online or by requesting a physical copy to be sent by post.
In Canada, the T1 General is the primary document used for filing personal income tax returns. This form is quite extensive and requires individuals to provide detailed information on all their earnings, expenses, and credits for the year. Along with the main form, the T1 General includes schedules and additional forms for reporting business income, capital gains, and rental income. You can obtain a copy of the T1 General from the CRA website, or you can file your tax return electronically through approved tax software. The CRA will use the information on the T1 General to calculate your tax liability and determine if you owe any money or are eligible for a refund.
There are three ways in which you can obtain a Notice of Assessment:
Let’s take each one in turn:
Just go to the Canada Revenue Agency’s website and use the “My Account” service. The My Account service now allows taxpayers to view and manage most tax information online, including the Notice of Assessment. Once the CRA has looked at your T1 General, it will send you a Notice of Assessment. This is where you can find it.
If you already have an account with the CRA, all you have to do is sign in. If you don’t, you can make an account and follow the easy steps on the site. On the government website, your NOA is under the tab called “tax returns.”
In the “My Account” section, you can also check to see if your NOA is ready and make changes to your information.
For example, if you move, you should update your contact information or change your bank information for direct deposit.
If you’d rather do things the old-fashioned way, you can still get your Notice of Assessment through the regular mail.
To do this, call the CRA at 1.800.959.8281 and ask them to send you a copy to your home address.
Downloading the MyCRA App is a simple way to get this important piece of information for your mortgage qualifications.
You can change your personal information and other parts of your profile, just like you can with an online account on the CRA website. You can also check your tax balance, statements, and mail from the CRA.
The MyCRA app is now available for businesses and individuals.
The MyCRA app is now a standalone app that can be downloaded from the Google Play Store or Apple App Store. It was only accessible through web browser before.
2- T1 General
On the CRA website, you can find your T1 General for this year and the last 11 years.
Your T1 General should be given to you by the person who sends in your tax return as soon as the return is done. You can find your T1 General if you do your own taxes using software like TurboTax or UFile.
If you can’t find your return, you’ll need to ask for a copy from the agency or person who filled out your return.
The Notice of Assessment (NOA) and T1 General are important documents used to file personal income tax returns in Canada. The NOA is a critical document that gives the status of a tax return and alerts to any potential problems. It includes the date the tax return was checked, as well as details about any refunds or credits due. The T1 General is essentially the same document, but it is not an official document
If you’re having trouble collecting the documents for your mortgage application, you’re not alone! It can be difficult to keep track of document names and where you can go to find each one, especially if you’re a first-time homebuyer who has never had to access them before.
We hope you’ve found this outline about Notice of Assessment (NOA) and T1 General useful.
Taxpayers needing more information on these topics and other income documents can contact the Filing Taxes team of professional accountants today at 416-479-8532. Start their journey towards owning a home. Schedule an NTR engagement appointment with us and take the first step towards proper management of your finances.
Disclaimer: The information provided on this page is intended to provide general information. The information does not consider your personal situation and is not intended to be used without consultation from accounting and financial professionals. Salman Rundhawa and Filing Taxes will not be held liable for any problems that arise from the usage of the information provided on this page.
When facing debt, many Canadians think that cashing out their investments to pay out their debt is a good idea. Unfortunately, the truth is that cashing out the funds in your RRSP to cover your debts is not ideal.
Here’s why:
If you’re struggling with debt, your best option is to consult an expert accountant. He will review your financial situation and help you come up with a plan to deal with your debts.
Withdrawing money from your RRSP may seem like a quick fix for your debt problem but doing so may hurt your financial situation in the long run. Filing for a consumer proposal or bankruptcy can eliminate your debt without affecting most of your long-term investments.
Filing for a consumer proposal or for bankruptcy to eliminate your debt also helps you rebuild your credit score. This can open up more financial opportunities for you in the future, whereas using your RRSP funds to cover your debt only damages your financial situation in the long run.
Selling some of your assets may help you solve your debt problem. If you own something of value that you no longer need, such as an older car or an unused property, it makes sense to sell it and use the funds to pay off your debt.
The same goes for most investment accounts other than an RRSP as well. Using those assets to pay off your debt may be a good idea because the interest rate on your debt may be higher than your accounts’ return on investment.
But if you rely on those assets for your job or financial security, it may be better to keep them. Your RRSP is a guarantee that you will live comfortably when you’re older, so you shouldn’t risk your future financial security for a temporary problem like debt.
Plus, the funds you withdraw out of your RRSP are taxable, so you will have to withdraw a larger sum than what you really need.
Whenever you withdraw from your RRSP, you have to include the sum you take out in your income and pay tax on it at your marginal tax rate. Because the money in your RRSP is fully taxable.
Your RRSP is a long-term investment that works in the same way for everyone. You contribute to the RRSP while you’re of working age and are included in a high tax bracket, and you should take the money out when you’re retired and are included in a low tax bracket.
The RRSP was specially designed to enable Canadian citizens to live comfortably in their old age. But if you want to tap into your RRSP funds while you’re still working and in a high tax bracket, you have to give a large part of that sum to the state.
You can tap into your RRSP funds to pay for your first home. You can withdraw up to $35,000 from your RRSP and use it as a down payment for your first home thanks to the Home Buyers’ Plan. Once you do so, you get a maximum of 15 years to pay back the sum, starting two years after you made the withdrawal.
You can also use your RRSP funds to finance your education. The Lifelong Learning Plan allows you to withdraw funds from your RRSP to pay off your school taxes or any other fees related to your education. This plan allows you to withdraw a maximum of $10,000 per year for a total of $20,000. Once you do so, you get a maximum of 10 years to repay the sum you withdrew.
You shouldn’t use your RRSP to pay your debts. If you’re struggling with debt or are behind on your bill payments, there are other options that can help.
Filing a consumer proposal or bankruptcy can help you get out of debt without affecting your RRSP. According to section 67 of the Bankruptcy & Insolvency Act, all the contributions to your RRSP except for those you made in the last 12 months are protected if you file a consumer proposal or personal bankruptcy.
Filing Taxes takes a personal approach to debt solutions. We take the time to study and understand your financial situation and provide you with debt relief options that will benefit you the most. For advice and assistance with tax planning, a CRA tax dispute, or other tax issues, get in touch with Filing Taxes today to see how we can help. Experts at Filing Taxes will be happy to assist business owners in this pursuit. To speak with an experienced accountant, contact Filing Taxes either at 416-479-8532 or [email protected]. Schedule an NTR engagement appointment with us and take the first step towards proper management of your finances.
Disclaimer: The information provided on this page is intended to provide general information. The information does not consider your personal situation and is not intended to be used without consultation from accounting and financial professionals. Salman Rundhawa and Filing Taxes will not be held liable for any problems that arise from the usage of the information provided on this page.
The main objective of income tax planning for individuals as well as families is to plan one’s finances in the most tax-optimized manner.
Many Canadians do not give much thought to how they can reduce their taxes until it’s time to file their tax returns each spring. By then, many tax-saving opportunities for the year may be lost. Filing your tax return is essentially once-a-year accounting to the government to settle up your taxes owing or refund due for the previous year —it is the tax planning steps that you take throughout each year that can save the most money at tax time and in the years to come.
Tax planning for individuals and families is an ongoing process to reduce the overall taxes owed by the family. It is usually the cumulative result of different tax planning strategies. The following tax planning techniques should be considered in consultation with experienced Canadian tax accountants:
Contributing to your Registered Retirement Savings Plan (RRSP) is a great way to invest, save for retirement and earn some tax savings along the way. You can make continued cash contributions to your RRSP or build an investment portfolio with the money that you contribute. Investment options include Guaranteed Investment Certificates (GICs), mutual funds, real estate investment trusts, and exchange-traded funds. You can put funds to your RRSP up to the allowable limit determined by the unused contributions from the previous year and your income earned in the current year.
A Canadian taxpayer’s income tax bracket and therefore the income tax liability depends on the absolute amount of the taxpayer’s income because the higher the income the higher the income tax bracket and the percentage of income tax paid. Income splitting is a tax planning strategy whereby one taxpayer transfers a portion of his/her own income to another taxpayer who is taxed at a lower tax rate. Income splitting is a practice used to reduce the overall tax bracket of a household.
Contributions to a Tax-Free Savings Account (TFSA) are not tax-deductible, but the income or capital gains earned from any investments in the TFSA are tax-free at withdrawal. A Canadian taxpayer’s Tax-Free Savings Account contribution room depends on the TFSA dollar limit, any unused TFSA contribution room from the previous year, and any withdrawals made from the TFSA in the previous year. This means that if one did not contribute anything for 2021, then in 2022, one can contribute using the unused contribution room from 2021. However, one can only contribute up the allotted contribution room every year. The earnings generated in the account and the increase in its value will not reduce the TFSA contribution room in the following year. But any excessive contribution will be subject to a tax that is equal to 1% of the excess contribution.
A Registered Education Savings Plan (RESP) is a registered contract between an individual (the subscriber) and a person or organization (the promoter). In the contract, the subscriber also has to name the beneficiaries who will be entitled to the education assistance funds from the RESP. The general arrangement is that the subscriber makes contributions to the RESP, and income earned in the account is tax-free so long as the money stays in the account before distribution to the beneficiaries. There are no immediate tax savings as RESP contributions cannot be deducted from your income on your T1 income tax and benefit return. In addition, you cannot deduct the interest you paid on money you borrowed to contribute to an RESP. The federal government will also match the contribution of the subscriber, according to the income of the subscriber, up to a maximum of $500 per year, per child. At maturity, when the beneficiaries are enrolled in an educational institution, money will be paid in the form of educational assistance payments to the beneficiaries. Beneficiaries have to include the educational assistance payments (which include the matching contribution from the government) in their income for the year in which they receive them from the promoter. However, they do not have to include the subscriber’s contribution portion of the payment that they receive in their income. The contribution may also be returned to the subscriber tax-free. Contributing to an RESP is a good way to earn tax-free income and save for the tuition costs of dependent children.
Canadian income tax shelters are always being sold for the current taxation year. Be sure you understand the risks, both business and tax, before making any decision to invest in a tax-sheltered investment or charitable donation gifting arrangement.
You can take advantage of Canada Child Benefit (CCB), which is non-taxable. You can capitalize on the Canada Child Benefit, offered by CRA (Canada Revenue Agency) as a single parent or having shared custody of the child. You must file your income tax return annually with your spouse or common-law partner to claim for it. Amounts are paid to the eligible families by the CRA for children under the age of 18.
Tax planning allows the taxpayer to use various tax exemptions, deductions, and benefits to minimize their tax liability. Thus it is a cumulative result of various income tax planning techniques. All the above-mentioned tax planning techniques should be considered only after consultation with our expert income tax planning tax professionals.
If you need any advice on tax-saving strategies from an expert tax accountant in Toronto, Mississauga, Oakville, and Hamilton feel free to reach out to Filing Taxes at 416-479-8532. Schedule an NTR engagement appointment with us and take the first step towards proper management of your finances.
Disclaimer: The information provided on this page is intended to provide general information. The information does not consider your personal situation and is not intended to be used without consultation from accounting and financial professionals. Salman Rundhawa and Filing Taxes will not be held liable for any problems that arise from the usage of the information provided on this page.
No one wants to pay more taxes than they have to, that is why many Canadian taxpayers might choose to alleviate some of the tax burdens through a practice called “Income Splitting”.
Income sprinkling – sometimes referred to as “income splitting” – is a strategy that can be used by high-income owners of private corporations to divert their income to family members with lower personal tax rates.
In simple words, income splitting is the transferring of income from a high-income family member to a lower-income family member to minimize the overall tax paid by the family. Since the Canadian tax system has graduated tax brackets, by having the income taxed in the lower-income earner’s hands, the overall household’s tax liability can be reduced.
At the federal level, you can continue to split income with your spouse or common-law partner, regardless of your age, as long as the retirement income is eligible. To qualify to split income, you and your spouse or common-law partner must reside in Canada and live together. The couple must live together for at least one year and not have been separated for more than 90 days at the end of the tax year. However, you can live apart if the reason is related to work, school, or medical necessity.
Income splitting is an electable action that you opt-in every year you file your taxes.
Recent changes to income tax rules expand the application of the Tax on Split Income (TOSI). Previously, TOSI only applied to split income of individuals under 18 years old. Now, TOSI applies the highest personal marginal tax rate (currently 33%) to any split income, regardless of age. This means income splitting with adult children or spouses is now subject to TOSI.
The goal of expanding TOSI is to limit income tax benefits when the recipient has not substantially contributed to a family business. The federal government has reduced corporate tax planning options, but some remain to mitigate tax liability. Taxpayers should understand the new TOSI rules and consult a tax professional about permissible income splitting and tax reduction strategies.
The TOSI rules will potentially apply if business owners or their family members earn the income types mentioned below:
Although income splitting is greatly restricted as a result of the expanded TOSI rules, some exceptions still allow individuals to benefit from income splitting with immediate family members (parents, child, or sibling, not an aunt, uncle, nephew, or nieces).
The first exception relates to the contribution of the family member to the business. If the family member receiving the income is over 18 years of age and is engaged in the business on a regular, continuous, and substantial basis, the TOSI rule may not apply.
Being engaged on a “regular, continuous, and substantial basis” is demonstrated when the respective family member hits the threshold of having worked in the business for an average of at least 20 hours per week in the current tax year, or in five previous tax years. The five years need not be in succession. Satisfying these requirements, any dividends received by a family member will not be subject to TOSI.
Providing evidence of sufficient engagement in the business may be challenging. However, obtaining all the possible information will help demonstrate the sufficient involvement of a family member in the business.
To claim an exclusion from TOSI for the shares held by a family member, the individual must be at least 25 years of age and hold shares that represent at least 10% of the corporation (in votes and value), and 90% of the corporation’s income must be earned from a provision of services. This exclusion is applicable if the shares held by the individual must not be shares of a professional corporation for example law or accounting firms, or dentistry and physician clinics.
If a family member is 25 years of age or older, it is possible to pay him/her a reasonable amount of income in the form of dividends representing a reasonable return on their contribution to the business, which would be excluded from TOSI. However, CRA does not guide what it deems reasonable. The reasonable test considers contributions to the business through a combination of the work performed by the individual in the business, the property contributed by the individual to the business and, the risks that the individual has taken concerning the business.
All these measures are subjective to how CRA will assess them as no clear definition of reasonable return is provided.
If the professional owner is over the age of 65 years and split income with a spouse or common-law partner regardless of the age of the spouse or common-law partner, the TOSI rules will not apply. This exemption is available only to the spouse or common-law partner, no other family member qualifies for it.
When your marginal tax rate differs significantly from those of your family members, it’s worth considering some income splitting strategies. Despite the expanded TOSI rules, there are strategies available to Canadians to work out a tax cut. Often, the difficulty lies in knowing which strategies would work best for you, here Filing Taxes plays a role to advise and help you.
The TOSI rules are extraordinarily complex, and many nuances are not discussed in this article. It is advisable to seek guidance from a tax expert about your specific business situation to determine how the TOSI rules will impact your business. If you have any questions, feel free to reach out to Filing Taxes at 416-479-8532. Schedule an NTR engagement appointment with us and take the first step towards proper management of your finances.
Disclaimer: The information provided on this page is intended to provide general information. The information does not consider your personal situation and is not intended to be used without consultation from accounting and financial professionals. Salman Rundhawa and Filing Taxes will not be held liable for any problems that arise from the usage of the information provided on this page.
Due to the pandemic, home office expenses have become the hot topic in taxation. Many people were required to work from home, and others started side gigs to make ends meet. Read on to find out what you can claim as home office expenses if you’re an employee or self-employed.
To claim your working from home expenses you must:
You can claim a deduction for the additional running expenses you incur because of working from home.
Running expenses are expenses that relate to the use of facilities within your home and include:
If you're a sole trader or business owner and your home is your principal place of business.
Whether you are claiming home office expenses as an employee or as a self-employed person, the basic eligibility criteria are the same. To claim these expenses, your workspace at home must meet one of the following conditions:
The workspace is where you mainly (more than 50% of the time) do your work.
You use the workspace only to earn your employment income. You also have to use it on a regular and continuous basis for meeting clients, customers, or other people in the course of your employment duties.
All expenses must be prorated based on the area that your home office represents relative to your entire home. For example, if your home office represents 10% of the total square footage of your home, you can only claim 10% of the eligible expenses.
As a rule, a self-employed individual can claim more expenses than an employee. For example, employees cannot claim expenses related to homeownership, such as mortgage interest and depreciation, but self-employed individuals can claim them. Computer accessories (monitor, mouse, keyboard, headset, etc.) and furniture (desk, chair) are other expenses that employees cannot claim.
There are also differences between salaried and commission employees. For example, a commission employee can claim home insurance and property taxes, but a salaried employee cannot.
Below is a handy table that compares the expenses you can claim as an employee or a self-employed individual.
| Expense | Salaried Employee | Commission Employee | Self-employed |
| Heat | Yes | Yes | Yes |
| Electricity | Yes | Yes | Yes |
| Insurance | No | Yes | Yes |
| Maintenance | Yes | Yes | Yes |
| Mortgage interest | No | No | Yes |
| Property taxes | No | Yes | Yes |
| Rent | Yes | Yes | Yes |
| Depreciation | No | No | Yes |
| Internet access fees | Yes | Yes | Yes |
| Cell phone fees | Yes | Yes | Yes |
| Computer accessories* | No | No | Yes |
| Furniture* | No | No | Yes |
* For self-employed individuals, these expenses would be claimed under depreciation.
If you are looking for a professional Tax Accountant who can lead you through the process of claiming business expenses on your tax return, then feel free to reach out to Filing Taxes at 416-479-8532. Schedule your tax preparation appointment with us and take the first step towards proper management of your finances. Our professional personal tax accountants will make sure to get you the maximum tax refund on your personal tax return.
Disclaimer: The information provided on this page is intended to provide general information. The information does not consider your personal situation and is not intended to be used without consultation from accounting and financial professionals. Salman Rundhawa and Filing Taxes will not be held liable for any problems that arise from the usage of the information provided on this page.
Tax Season is upon us, so you may be tempted to save yourself a few dollars by doing your own taxes. Tax returns may seem straightforward, but they can be complicated and stressful to the untrained eye. Luckily, Filing Taxes is here for your help. Let’s begin with “What is Line 10100 on My Tax Return?”
One of the few tax lines that most Canadians will have on their tax return is line 10100. In case you're wondering what exactly it is, you've come to the right place.
Simply put, Line 10100 captures the employment income on your Canadian tax returns. Employment income is usually shown in box 14 of the T4 tax slips you received from your employer(s).
Salaries, commissions, wages, gratuities, bonuses, and tips are a few examples of employment income that could be reported on box 14. Your employment income is reported on box 14 of your T4 slips, and the total of your box 14 amounts from all T4 slips makes up your line 10100. Although line 10100 is your employment income, it doesn't always represent your total income. This amount is found lower on your return on line 15000.
When you have an employer (or employers), they will provide you with a T4 slip during tax season. This slip will state your income to place into line 10100 on your tax return.
If you have not received a T4 slip from your employer, you may want to speak to them directly. All employers are required to submit T4 slips to their employees by the end of February. Since line 10100 depends on T4 slips, it is important to contact your employer about missing slips. If your employer fails to send the forms, even after contacting them, you can log in to CRA My Account and view slips from previous tax years.
Locating line 10100 can be a tad confusing, especially if it is your first time filing your tax return. The entry is often used to verify CRA logins and is a vital part of the annual return. If you have completed filling the return and looking back to find line 10100, it is located on the third page of your T1 General Form. You can pull up your T1 from CRA My Account and print it or complete online filling. Line 10100 appears in Step 2 on Page 3 of your T1 – Income Tax and Benefit Return. It is also the first line of Step 2 you will encounter on provincial and territorial income return forms and designated as the "Total Income" section of the T1.
The figures in Box 14 of your T4 slips are what goes into line 10100. Box 14 captures all your employment income across all your jobs and includes salary, wages, bonuses, and so on. If you receive any of these amounts from your employer and they’re included in box 14 of the T4 slips, they count as employment income used in calculating amounts for line 10100.
Not all employment income is included in the T4 slip, which you need to calculate line 10100 entries. For instance, income earned from another country, net research grants, veteran benefits, clergy housing allowance, royalties, and wage-loss replacement don't appear on your T4. Line 10400 is known as Other Employment Income and includes some insurance plans and workplace payment plans. Other non T4 entries that you should add to line 10400 include income from supplemental unemployment benefits, employee profit-sharing plans, and medical premium benefits, as well as tips not included on your T4 slip.
Why is it important to calculate the amount that goes to line 10100, or why is it even necessary to know the amount? Here are a few reasons:
Employment income is the biggest tax line item for most Canadians.
It is used to verify CRA logins and you may be asked to confirm the amount if you call CRA on the phone
Additionally, it is used to calculate how much Canada employment amount, line 31260, you can claim on your tax returns.
The amount in Line 10100 only contains employment income. If you have income from other sources, then your total income would differ from this amount.
Line 15000, found at the end of Step 2 of the T1 – Income Tax and Benefit Return, is the tax line that captures income from all sources.
Yes. As of 2020, tax forms have been revised. Several different revisions have been made, one of them is related to the numbers and lines. Lines that used to contain only 3-4 digits now contain 5 digits. Line 101, for example, has now been changed to Line 10100.
Why the changes? Perhaps to harmonize the numbering system or to make it easier to add new tax lines in the future.
Hopefully, you now have a better understanding of what line 10100 on your tax returns means and where to find the amount.
Our experienced and professional team at Filing Taxes is here to set you on the right path considering your personal business situation. Feel free to reach out to Filing Taxes at 416-479-8532. Schedule an NTR engagement appointment with us and take the first step towards proper management of your finances.
Disclaimer: The information provided on this page is intended to provide general information. The information does not consider your personal situation and is not intended to be used without consultation from accounting and financial professionals. Salman Rundhawa and Filing Taxes will not be held liable for any problems that arise from the usage of the information provided on this page.
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