Why do I need to file my taxes?
Filing your taxes is a requirement for all Canadians. If you don’t, you’ll lose access to payments you may be eligible for such as social programs, HST rebates, climate rebate, child benefit payments, age pension, until your tax returns are filed and up-to-date. Most of these programs start in July (after income taxes have been reported for April 30).
Where do I find all the slips I need to file my taxes?
One of the hardest things these days is locating your tax documents. (Very few are mailed through Canada Post) and you need to chase the tax documents through Log Ons for work (T4) Service Canada (T4E), Banks (T5+ RRSP) Investment Accts (T3, T5 RRSP). But there is an easier way. Create a “My Account” through Revenue Canada and get a copy of all tax documents with your Social Insurance Number.
Overview of Changes for Tax Year 2024
Home Buyers’ Plan (HBP) withdrawals The HBP withdrawal limit has increased from $35,000 to $60,000 for withdrawals made after April 16, 2024. In addition, temporary repayment relief was introduced to defer the start of the 15-year repayment period by an additional three years for participants making a first withdrawal between January 1, 2022, and December 31, 2025. Accordingly, the 15-year repayment period will start in the fifth year following the year that the first withdrawal was made.
Other Highlights
- Maximum Vehicle cost allowed increased to $37,000 + HST.
- Maximum monthly lease costs allowed increased to $1,050.00
- The OAS Pension clawback starts when net income is over $90,997 at a rate of 15%
- GIS Guaranteed Income Supplement must be less than $22,056 for a single person and under $29,136 for a married person.
- First Home Savings Account (FHSA) Annual limit is $8,000 to a maximum of $40,000. Individuals are allowed to with draw from a FHSA and RRSP HBP for the same home purchase.
- Max RESP limit is $50,000
- RDSP Contributions end when taxpayer turns 59.
- If Income taxes payable exceed $3,000 you must pay tax instalments, if you do not pay the tax instalments on time you will be charged interest.
- Carbon Tax Rebates: You’ve probably received your Ontario Carbon Tax rebate, This is not claimed on your personal income tax return, however any businesses receiving the Carbon Tax Rebate must claim this as other income.
- The capital gains rate changes from 50.0% to 66.6% originally scheduled for 2024 tax year, has been delayed until Jan 1, 2026. The new capital gains rate in the future would apply to any capital gains earned over $250,000.
Payroll Changes for 2025
- There is a second CPP deduction on your T4 (Box 16A) For Gross income over $73,200 you pay an added $188.00 into CPP. For 2025 the second CPP moves to $81,200 with a maximum of $396.00
- EI will decrease to 1.64% of gross earnings – 2024 rate was 1.66%