Need to know on Personal tax for 2015 and 2016
- Capital Cost Allowance is limited to the first $30,000 of the automobiles cost, plus applicable GST/HST/PST (not including amounts that will be refunded through input tax credits).
- Interest on financing of automobiles is limited to $10 per day.
- Deductible leasing costs are limited to $800 per month.
- Operating Cost Benefit = $0.27 per kilometer.
- Deductible Rates = $0.55 for first 5,000 kilometers, $0.49 for additional kilometers.
- The lesser of $24,930 and 18% of 2014 Earned Income
- Reduced by the 2014 Pension Adjustment and any 2015 Past Service Pension Adjustment
- One of these deferrals could be contribution to RRSP. If you contributed to your RRSP or your spousal account in 2015 and the first 2 months in 2016, you are not required to count this for 2015-year tax deduction, and defer it for your future year, if you are expecting that return will be higher; and
- Another deduction that need to be considered is capital cost allowance (CCA). This option is good for self-employed, who bought some assets and they are reducing your tax by depreciation. CCA is a discretionary deduction and could be used in the future years. CCA might reduce your taxes if you are earning income by renting property, or from employment, etc.
Stock options employees with annual earnings of more than $100,000 would be affected.
CCPC – will be closer look if those corporations are not used to reduce personal income tax.
Changes for families:
- Income splitting for families will be cancelled, beginning 2016, resulting in increasing of tax bill for families with children under 18
- Universal Child Care Benefit (UCCB), Canada Child Tax Benefit (CCTB) and National Child Benefit (NCB) would be replaced by Canada Child Benefit, starting July 1, and will be tax free and will be declining as parent’s income goes up.
People with income greater than $200,000 will experience reduction in tax benefit.
For students – tax credits for education ($720) and textbooks ($117) will be cancelled
For Seniors – Old Age Security and Guaranteed Income Supplement will be eligible at age of 65
For Teachers and early childhood educators – new refundable tax credit for buying school supplies
RRSP – will be more flexible and accommodate needs of individuals who relocating to a new place, had a marital breakdown, death of spouse, or living with older family member.
EI premiums will decline from $1.88 to $1.65 per $100 of insurable earnings.
CPP payments would be increased by 1.2% for those already receiving benefits.
GST on capital investments would be removed