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Business and Tax.com
As a Canadian resident, you have to
report your income from all sources, both inside and outside Canada.
The federal personal income tax rates for 2003 is:
The Ontario personal income tax rates for 2003 is:
federal/Ontario personal income tax rates for 2002
The personal tax credits for 2003 is:
There are many different RRSP investment alternatives available to you. You
The amount you can deduct for 2001 RRSP contributions is based on your 2001 RRSP deduction limit, which appears on your latest Notice of Assessment or Notice of Reassessment for your 2000 return.
The HBP is a program that allows you to withdraw up to $20,000 from your registered retirement savings plans
(RRSPs) to buy or build a qualifying home for yourself or a related disable
person. If you buy the qualifying home together with your spouse or other
individuals, each of you can withdraw up to $20,000. If you withdraw an amount from
a RRSP, you may not be able to deduct all or part of the contributions
made during the 89-day period just before your withdrawal under the HBP.
Some RRSPs, such as locked-in or group
RRSPs, do not allow you to withdraw funds from them.
You can only withdraw funds from an RRSP under which you (the participant) are the annuitant.
If you contributed to your spouse's RRSP, your spouse is the annuitant of the
RRSP, even if you have
There are certain conditions for participating the HBP:
Canada Child Tax Benefit
The CCTB combines a basic benefit with the National Child Benefit Supplement (NCBS) for lower-income families.
Basic benefit (July 2001 - June 2002):
The benefit will be reduced if your family net income is more than $32,000. The reduction is 2.5% of the amount of family net income that is more than $32,000 for a one-child family, and 5% for families with two or more children.
National Child Benefit Supplement (NCBS) (July 2001 - June 2002):
The NCBS will be reduced if your family
net income is more than $21,744. The reduction is 12.2% of the amount of
family net income that is more than $21,744 for a one-child family; 22.5% for a family with two children;
and 32.1% for families with three or more children.
If you are eligible, you should apply for the benefit even if you think you will not be entitled to receive it based on your current family net income. CCRA automatically recalculates your entitlement every July after it receives your tax information. If your family net income changes and you have already applied for the benefit, you will not need to remember to apply again.
To apply for the CCTB, you have to complete Form RC66, Canada Child Tax Benefit Application. In addition, depending on your immigration and residency status, you may have to complete the schedule called Status in Canada.
To continue to be eligible for the CCTB, you have to continue to be a resident of Canada for income tax purposes. If, after you apply, your spouse or common-law partner stays outside Canada or becomes a non-resident of Canada, he or she will have to complete Form CTB9, Canada Child Tax Benefit - Statement of World Income.
Payment of CCTB stops automatically when the child turns age 18. The last payment will be for the month of his or her birthday.
You can apply for the GST credit if, at the end of the taxation year:
If you qualify, GST payments will be made four times a year, in July and October of the current year, and January and April of the next year. However, if your total credit for the year is less than $100, all of it will be paid in July of the current year. If you apply, Canada Customs and Revenue Agency (CCRA) will let you know in July of the current year the amount to which you are entitled, if any, and how the credit was calculated. If you move, you should tell CCRA, or your payments may be interrupted.
In the 1995 federal budget, the federal government announced a new foreign property reporting requirement. Canadian resident individuals, corporations, trusts and certain partnerships who own specified foreign property, with an aggregate cost in excess of C$100,000, at any time in the year, will be required to report information about these properties to Revenue Canada
Specified foreign property includes
any interest in tangible or intangible property situated outside Canada,
(including real estate, bank accounts, shares and debt) and any right to
acquire such property. Specifically excluded, however, are personal-use
properties, such as cottages, houses, condominiums and yachts; property
that is used exclusively in carrying on an active business; certain
As a result of various concerns
raised by the private sector, there have been a number of delays and
modifications to this reporting requirement.
The first reporting date for interests in foreign property with a
cost in excess of $100,000 was extended to April 30, 1999, and this foreign
information would only be required for 1998 and subsequent years.
The new reporting form (T1135,
Foreign Income Verification) uses a "check-the-box" format for
foreign asset disclosure, and simply requires affected taxpayers to check
the boxes that accurately correspond to type, location and range of
investment levels and indicate the amount of income from the reported
Transactions with foreign trusts (
Form T1141E/T11412) and interests in foreign affiliates (Form T1134A/T1134B)
also have to be reported.
The penalty for failure to file or
for late filing is generally $500 per month for up to 24 months. It
was planned that more severe penalties apply in the case of intentional
non-filing for more than 24 months or where there has been willful omission
or misrepresentation of information, amounting to gross negligence. In such
cases, the penalty is computed as 5% of the cost amount of the assets not
reported or misrepresented, with a minimum penalty of $24,000 for omissions
and misrepresentations. But such plan will be frozen for further consultation.