Personal income tax in Canada is a type of tax that the government imposes on income generated by individuals. Federal tax rates range from 15-33% depending on your income level.
All provinces also have a provincial tax which would be additional (for example Alberta’s ranges from 10-12%), however, many tax deductions are available to reduce your income amounts and thus reduce your taxable income. Taking advantage of these is crucial in saving you tax dollars.
For most individuals in Canada the personal tax year runs January to December.
There are many deductions available, but some of the most common include:
- Medical Expenses
- Childcare Costs
- RRSP Contributions
- Donations
Some specific deductions exist as well such as credit for a first-time home buyer. It is best to talk to an accounting professional about your situation to make sure you are maximizing your deductions.
To file your personal taxes in Canada, make sure you have all the tax slips that you might have received plus any details on other income you might have earned (i.e. rental income).
