Best Practices

Pension Income Splitting For The 2024 Tax Year For most Canadian retirees, careful financial management is a necessity. Most live on an annual income which is less than that which they enjoyed during their working years, and opportunities to increase that income in any significant way are limited. As well, in recent years, inflation (especially […]

Reporting Online Income On The 2024 Tax Return The Canadian tax system casts a very wide net, in which each resident of Canada is taxable on all sources of income worldwide, with very few exceptions. In addition, Canada has what is known as a “self-assessing” system, in which Canadian residents voluntarily file an annual tax

How To Respond to A Tax Instalment Reminder While virtually every working Canadian pays income taxes, the process by which those taxes are collected throughout the year is largely invisible to the taxpayer. That’s certainly the case for employees, because income taxes (and other statutory deductions like Canada Pension Plan contributions and Employment Insurance premiums)

RRSPs, TFSAs, and FHSAs – making the annual choice For most taxpayers, the first few months of the year can seem to involve a seemingly unending series of bills and payment deadlines. During January and February, many Canadians are still trying to pay off the bills from holiday spending. The first income tax instalment payment

Employment Insurance premiums for 2025 The Employment Insurance premium rate for 2025 is set at 1.64%. Yearly maximum insurable earnings are increased to $65,700, making the maximum employee premium $1,077.48. As in previous years, employer premiums are 1.4 times the employee premium. The maximum employer premium for 2025 is therefore $1,508.47. The information presented is

Figuring out when you can afford to retire While almost everyone looks forward to retirement and an end to the day-to-day demands of working life, there’s also no question but that the decision to give up a regular paycheque is a stressful one. Particularly when the cost of life’s necessities – especially food and housing

Canada Pension Plan contributions for 2025 As of 2024, there are two contribution levels for the Canada Pension Plan (CPP). Income amounts and employee contribution percentages for 2025 for each contribution level are as follows. First tier contributions for 2025 are set at 5.95% of pensionable earnings between $3,500 and $71,300. Second tier contributions for

Federal individual tax credits for 2025 Tax credit amounts on which individual non-refundable federal tax credits for 2025 are based, and the actual tax credit claimable, will be as follows:   Credit Amount Tax Credit $16,129.00 $2,419.00 $16,129.00 $2,419.00 $16,129.00 $2,419.00 $45,522.00   $1,471.00  $221.00 $10,138.00  $1,521.00 $19,580.00 $2,937.00 $2,834.00   *For taxpayers having net

Federal individual tax rates and brackets for 2025 The indexing factor for federal tax credits and brackets for 2025 is 2.7%. The following federal tax rates and brackets will be in effect for individuals for the 2025 tax year. Income level                    Federal tax rate $16,129 – $57,375                   15.0%

Tax consequences of holiday gifts and celebrations It seems incongruous, in the season of holiday gifts and celebrations, to consider the possible tax implications and consequences of those traditions. But, in some circumstances, the unwelcome spectre of an income tax bill arising from such activities does intrude. Fortunately, there are never any tax consequences to