Tax Around the World: Canada January 3, 2006
In Canada, both the federal and provincial governments impose income taxes on individuals. Income taxes throughout Canada taxes are progressive with the wealthy paying a higher percentage than the poor. Canadian income taxes are still less progressive than those of many nations, as there are only four tax brackets compared to the six that USA has.
2006 Canada Federal Tax Brackets
| Marginal Rate |
Individual |
| 15% | 0 - 36,378 |
| 22% | 36,379 - 72,756 |
| 26% | 72,757 - 118,285 |
| 29% | over 118,286 |
Provincial income tax is not included in these brackets. Although there are ten provinces, I’ll give four examples, British Columbia, Ontario, Quebec, and Alberta provincial taxes:
2006 Canadian Provincial Tax Brackets
| Province | Tax Rates and Brackets |
| British Columbia (Top federal + province income tax: 43.7%) |
6.05% ($0 - 33,755) 9.15% (33,756 - 67,511 11.7% (67,512 - 77,511 13.7% (77,512 - 94,121 14.7% (94,122 and over) |
| Ontario (46.41%) |
6.05% ($0 - 34,758) 9.15% (34,759 - 69,516) 11.16% (69,517 and over) |
| Quebec (48.22%) |
16.0% ($0 - 28,710) 20.0% (28,711 - 57,430) 24.0% (57,431 and over) |
| Alberta (39.0%) |
10.0% All income |
Income not taxed
It is interesting to note what is not taxed in Canada. The following list is not comprehensive:
- gifts and inheritances;
- lottery winnings;
- winnings from betting or gambling for simple recreation or enjoyment;
- strike pay;
- compensation paid by a province or territory to a victim of a criminal act or a motor vehicle accident (Quebec has changed rules in 2004 and, legally, this may be taxed or may not–Courts have yet to rule);
- certain civil and military service pensions;
- war disability pensions;
- RCMP pensions or compensation paid in respect of injury, disability, or death (Quebec has changed rules in 2004 and, legally, this may be taxed or may not–Courts have yet to rule);
- income of First Nations, if situated on a reserve;
- profit from the sale of a taxpayer’s principal residence;
- provincial child tax credits or benefits and Québec family allowances;
- the goods and services tax or harmonized sales tax credit (GST/HST credit); and
- the Canada Child Tax Benefit.
Source:
Taxation in Canada - Wikipedia
- Posted in : Tax Brackets Around the World
- Author : Kyle
Comments»
I am starting a new job, my salary will go from $40000 to $110000 in Fort Mcmurray Alberta. I was wondering what my tax bracket would be if it is even worth it for me will my tax bracket go up to 40%?
Thanks so much,
Pam Jones
If you earn 40,000 a year , after tax you will get 27200. (40,000x 68%). If you make 110,000, after tax you will have 110,000×64%=70,400. So it is worth going for it.
I am a Prof. Dr.Eng.Scientist resaercher ,visitor to Canada ,invited as a visitor to work in a research center ,in a research of high value to Canada,I will have amount of money , 5000 CND /month to cover the expenses of living. I work for a year .Should I pay TAXES,and how much ?
Thank you
I am a US citizen and am pondering a position in Montreal at 120k with 20 - 40k bonus. Any insight on my tax consequences as a US Citizen? Much appreciated.