Last updated: Feb. 22, 2023
Filing a return that is accurate and on time is the best way to avoid tax penalties and over-payment.
With that in mind, below is a list of key dates and tax numbers to help you with your tax return.
Canada’s tax filing and payment deadlines
* Since the standard April 30 tax deadline falls on a Sunday in 2023, the due date is the next business day – Monday May 1, 2023
**If you are paying tax by instalments, please read more here
Canada’s tax brackets
In a marginal tax rate system like Canada’s, individual taxpayer income is divided into tax brackets. These brackets determine the rate of tax applied to the taxable income that falls within that range.
Oftentimes, people believe that if they move up a tax bracket, they’ll have to pay the higher rate on their entire income. In reality, the first dollar you earn will be taxed at the rate for the lowest tax bracket, and your last dollar earned will be taxed at the rate of the highest bracket for your total taxable income.
The taxable income you earn in between the lowest and your highest rate will be taxed at the appropriate rate(s) for that range.
Tax bracket thresholds
Every year, the Canada Revenue Agency (CRA) indexes both income tax and benefit amounts to inflation using the Consumer Price Index.
For 2023, the indexation increase rose to 6.3% from 2.4% in 2022. As a result, the tax brackets for 2023 have been increased as per below:
Canada’s income tax rates
Personal and self-employed income tax rates
If you operate your business as a sole-proprietor or are self-employed, any income you earn through your business is taxed at the personal rate. For 2022, personal income is taxed as follows:
- 15% on the first $50,197 of taxable income, plus
- 20.5% on the next $50,195 of taxable income (on the portion of taxable income over $$50,197 up to $100,392), plus
- 26% on the next $55,233 of taxable income (on the portion of taxable income over $100,392 up to $155,625), plus
- 29% on the next $66,083 of taxable income (on the portion of taxable income over $155,625 up to $221,708), plus
- 33% of taxable income over $221,708
For 2022 incorporated business tax rates, please read our blog
Basic personal amounts
The basic personal amount (BPA) is a non-refundable tax credit, available to all individual taxpayers which provides:
- a full federal income tax reduction to individuals with taxable income below the BPA.
- a partial federal income tax reduction to taxpayers with income over the BPA.
Key numbers for Canadians
Key numbers for Canadians 65 years and older
Key numbers for Canadians with children or dependents
Free Download: Year-End Tax Planning Strategies for Your Small Business
Many small business owners wait until spring to start thinking about their taxes, but this simple act of waiting could cost them thousands.
Fall is actually the best time to start think about your taxes. It allows you to get organized and assess what actions you can take before the end of the tax year to lower your future business or corporate income taxes.
Consider this toolkit your roadmap to help you get organized, reduce your tax burden, and keep more money in your pocket.
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