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The marginal tax rate is the amount of tax on your next dollar of taxable income. Canada’s income tax system is a progressive tax system. Different tax rates are applied on different levels of income.
The first-time home buyers’ tax credit (HBTC) is a non-refundable tax credit introduced in 2009 for the first-time home buyers who acquire a qualifying home after January 27, 2009, that is – closing after this date.
Tax planning involves arranging one’s financial affairs to reduce the tax liabilities. There are three basic goals of tax planning:
In terms of the effective tax rates, Canadians can divide their income into three categories: ordinary income, capital gains, and dividends.
The General Anti-Avoidance Rule (GAAR) was introduced as part of the 1988 tax reforms to the Income Tax Act by enacting section 245. This provision allows the Canada Revenue Agency to redetermine the tax consequences of a transaction(s) entered into by a taxpayer in an effort to deny the tax benefit(s) otherwise enjoyed by the…
In Canada, capital gains have always received preferential treatment in that they are not 100% taxable. Here is a summary of the history of percentage of capital gains which were subject to tax: