2024 Canadian Income Tax Rates - Are You Prepared?

Published: Aug 21, 2024 Duration: 00:04:59 Category: Education

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hi everyone my name is Simon Mich from optimized accountant and in this video we're going to be talking about the 2024 Canadian tax rates for income tax purposes and you may be moving to Canada from the United Kingdom or the United States and it's really essential that you understand how Canada and the taxes works so let's go through the details living in Canada you will be taxed on your worldwide income and gains so if you're in Canada you're resident there all of your income if it's in the United States or in the United Kingdom it will be subject to Canadian taxes if you living in Canada second of all income on real estate or business so you may actually be living in the United States you might be living in the United Kingdom even as a Canadian you might be living elsewhere but if you have business activities there in Canada or indeed real estate property in Canada you will still pay income tax to the Canadian tax Authority so please don't think that you're leaving the country and you're escaping taxes no no no no there is going to be tax on your activities still in Canada some key dates for you to think about uh the the fiscal year the tax year is a calendar year in Canada similar to the United States so it runs from the 1st of January to the 31st of December each year you have a bit longer than United States uh tax year which is normally the 15th of April in Canada you have until the 30th of April to submit your tax return now if you're self-employed it is you do have an extension to June for self-employment and one thing you do need to be in mind even if you do have an extension for self-employment you still have to pay your taxes by the 30th of April otherwise you are going to pick up late interest charges so even though your self-employed you could have an extension it's probably better just ignore that and get your tax return done submitted to the Canadian tax authorities by the 30th of April and pay your taxes at the same time some things to bear in mind is how much tax will you be paying and I'm good to do some separate videos comparing the United States uh to Canada and the United Kingdom to Canada as well but for now we be really simple so here 2024 you got a taxfree of $ 5,978 that's Canadian dollars which is amount of money you can earn without paying any taxes at all and then there are some scaled rates which are now showing on your screen so it does go up it is a progressive tax system very similar to the United Kingdom and the United States so your top tax rate up to 165,000 is actually 26% it gets worse so you do have a 29% tax Band for earnings of 235,000 $ 675 Canadian dollars 33% for above that amount now it doesn't stop there because you also have this provincial and territorial tax rates so if you're moving from the United States or the United Kingdom and you're mooving to different parts of Canada then you do need to be aware that they charge you an additional amount of tax as well as the federal rate which is what we've been just looking at so Alberta for instance has a top tax rate of 15% and cubec has 25% now it is possible therefore that you'll end up paying 50% tax so when people look at Canadian versus UK or Canadian versus US you think well actually we pay more taxes in in our countries you always need to look at your specific situation of where you're going to live in Canada and therefore you do have this rate if you're leaving Canada by the way and you don't have any ties to that particular provincial territorial area then you don't have to submit tax turns to that area anymore I do know that there are Canadians that still do the tax filing to their provincial State and then they get CH charged unnecessarily it's something you can't avoid but again if you think about moving to Canada bear in mind you've got a federal rate and a state tax which is in addition to the federal rate so you could as to say if you you live in cubec you could actually be paying more than 50% income tax to the Canadian tax authorities [Music]

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