2019 Personal Tax Changes in Canada Announced By Federal Budge

Apr 1, 2019 – Toronto, Canada – Now is the time for filing your 2018 income tax return, however, as a proactive accounting and tax firm Woodbridge On Accounting we keep our clients ahead of the game by providing them valuable updates in the beginning of the current year (2019) so that they can plan their taxes before they are due. 

Canada Workers Benefit:

Effective January 1, 2019, Working Income Tax Benefit (WITB) was replaced by more generous Canada Workers Benefit (CWB). This change will result in more benefit to low-income working taxpayers of Canada. Canadians will start receiving these enhanced benefits under the new CWB in early 2020, when they will file their 2019 tax returns. 

Deduction of employee contribution to the enhanced portion of CPP and QPP:

Normally employee contribution to CPP is allowed as a non-refundable tax credit, however, with the commencement of enhanced CPP and QPP contribution from January 1, 2019 the employees contribution to enhanced portion of CPP and QPP will be allowed as a tax deduction. Tax deduction is more tax advantageous than a non-refundable tax credit. Non-refundable tax credit is limited to 15% as a federal tax credit and 5.05% as a provincial tax credit (in Ontario) and is not refundable if the non-refundable tax credits exceed the federal or provincial tax whereas tax deduction can result in higher tax saving depending upon your marginal tax rate on your taxable income. These savings will reflect when the Canadians will file their 2019 income tax return. 

Dividend Tax Credit:

The taxation of non-eligible dividends will be adjusted to reflect the reduction in small business tax rate. 

Climate Action Incentive:

As part of the Government of Canada’s climate change plan, residents of New Brunswick, Ontario, Manitoba and Saskatchewan will receive a new tax credit called the Climate Action Incentive when they file their 2018 tax return. Anyone living in these provinces will be charged a federal carbon tax beginning in April 2019 – it’s called a “fuel charge.” This will be added to the cost of the gas when filling up at the pumps or added to the home heating bills. So, what does this really mean when it comes to filing tax return? The average family of four will receive an incentive of $609 in Saskatchewan, $339 in Manitoba, $307 in Ontario and $256 in New Brunswick. People who live in more rural areas will get 10% more than those in cities to account for the fact that they likely use more energy and they don’t have as many public transportation options to reduce their fuel consumption.

If you would like more information on these updates and changes or have any tax question, please call Ish Jindal, CPA, CGA or visit https://www.woodbridgeonaccounting.ca/contact_us.html

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Company Name: Ish Jindal CPA Professional Corporation
Contact Person: Ish Jindal CPA, CGA
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Phone: (416) 414-3100
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City: Concord
State: ON
Country: Canada
Website: https://www.woodbridgeonaccounting.ca