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Income Tax/CCRA

2015/2016 tax brackets, combined British Columbia and Federal rates:

2015 Taxable Income Tax Rate 2016 Taxable Income Tax Rate
first $37,869 20.06% first $38,210 20.06%
over $37,869 up to $44,701 22.70% over $38,211 up to $45,282 22.70%
over $44,701 up to $75,740 29.70% over $45,282 up to $76,421 28.20%
over $75,740 up to $86,958 32.50% over $76,421 up to $87,741 31.00%
over $86,958 up to $89,401 34.29% over $87,741 up to $90,563 32.79%
over $89,401 up to $105,592 38.29% over $90,563 up to $106,543 38.29%
over $105,592 up to $138,586 40.70% over $106,543 up to $140,388 40.70%
over $136,586 up to $151,050 43.70% over $140,388 up to $200,000 43.70%
over $151,050 45.80% over $200,000 47.70%
BC Basic Personal Amount Tax Rate BC Basic Personal Amount Tax Rate
$9,938 5.06% $10,027 5.06%
Federal Basic Personal Amount Tax Rate Federal Basic Personal Amount Tax Rate
$11,327 15.00% $11,474 15.00%

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Canada Pension Plan

The maximum pensionable CPP earnings level for 2016 has increased to $54,900. Contributors who earn more than the $54,900 ceiling on pensionable earnings in the year 2015 are not required or allowed to contribute more to the CPP.

Employee contribution rates for the year 2014 remain at 4.95% and the basic exemption remains at $3,500. The maximum employee contribution to the plan in 2015 is $2,544.30

Self-employed maximum contributions increase to $5,088.60.

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Employment Insurance

The maximum EI earnings for 2016 have increased to $50,800. Contributors who earn more than the $50,800 ceiling on insurable earnings in the year 2016 are not required to contribute more to EI.

Employee contribution rates for the year 2015 remain at 1.88%. The maximum employee contribution to the plan in 2016 is $955.04, up from $930.60 in 2015.

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RRSP

How much can you contribute?

The historical limits and increases for registered retirement savings plans (RRSPs) and Defined Contribution (also known as Money Purchase) Registered Pension Plans (RPPs) are as follows:

Year RRSP Defined Contribution RPP
2009 $21,000 $22,000
2010 $22,000 $22,450
2011 $22,450 $22,970
2012 $22,970 $23,820
2013 $23,820 $24,270
2014 $24,270 $24,930
2015 $24,930 $25,370
2016 $25,370 $26,010
2017 $26,010 indexed

Note: The RPP limits are based on current-year earnings; RRSP limits are based on prior-year earnings. RRSP contribution amounts are 18% of earned income to the maximum limits above.

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Permitted CCRA Withdrawals from an RRSP

  • Home Buyers’ Plan (HBP)
    1. Limits: $25,000 per participant
    2. Eligibility: ‘First time home owners’
    3. Repayment: Within a period of no more than 15 years following the withdrawal
  • Lifelong Learning Plan (LLP)
    1. Limits: $10,000 per year to a maximum of $20,000 over four years
    2. Eligibility: either you or your partner must be enrolled in a qualifying educational program, minimum of three months duration
    3. Repayment: Within a period of no more than 10 years following the withdrawal

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TFSA (Tax-Free Savings Account)

  • Limits: Under proposed legislation, starting January 1, 2016, the annual TFSA dollar limit for 2016 will decrease from $10,000 to $5,500 and will be subject to indexation.
  • Any unused contribution room can be carried forward. There is no lifetime limit on total contributions.
  • TFSA contribution room is tracked by CRA and reported on your Notice of Assessment. An income tax return MUST be filed each year to qualify for your annual amount. Even in years without report income a tax return should be filed to qualify for your annual TFSA contribution entitlement.
  • Contributions can be made by made by Canadian residents aged 18 and over.
  • Contributions can also be made by a spouse or common-law partner, with no applicable attribution rules to either spouse.

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RESP (Registered Educational Savings Plan)

  • Limits: No annual limits; Lifetime contribution limit of $50,000
  • CESG (Canadian Education Savings Grant) will contribute 20% on the first $2,500 of annual RESP contributions per beneficiary; lifetime maximum of $7,200
  • An RESP terminates after year 35 of inception

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