Both the federal and provincial governments have imposed income taxes on individuals and self-employed persons, and these are the most significant sources of revenue for those levels of government accounting for over 40% of tax revenue. The federal government charges the bulk of income taxes with the provinces charging a somewhat lower percentage, except in Quebec. Income taxes throughout Canada are progressive with the high income residents paying a higher percentage than the low income residents.
Where income is earned in the form of a capital gain, only half of the gain is included in income for tax purposes; the other half is not taxed.
Federal and provincial income tax rates are shown at the Canada Revenue Agency's website.
Personal income tax can be deferred in a Registered Retirement Savings Plan (RRSP) which may include mutual funds and other financial instruments that are intended to help individuals save for their retirement and Tax Free Savings Accounts (TFSA) is another tool for financial planning and save the earned interest tax-free.
Tax Insight professionals understanding these aspects perfectly utilize our industry expertise to prepare your taxes in compliance with Income Tax Act and Regulations while positively strive to minimize your obligations thus optimizing your after tax dollars.
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