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Income Tax/CRA

2023/2024 tax brackets, combined British Columbia and Federal rates:

 

2024 Taxable Income Tax Rate 2023 Taxable Income Tax Rate
first $47,937 20.06% First $45,654 20.06%
over $47,937 up to $55,867 22.70% over $45,654 up to $53,359 22.70%
over $55,867 up to $95,875 28.20% over $53,359 up to $91,310 28.20%
over $95,875 up to $110,076 31.00% over $91,310 up to $104,835 31.00%
over $110,076 up to $111,733 32.79% over $104,835 up to $106,717 32.79%
over $111,733 up to $133,664 38.29% over $106,717 up to $127,299 38.29%
over $133,664 up to $173,205 40.70% over $127,299 up to $165,430 40.70%
over $173,205 up to $181,232 44.08% over $165,430 up to $172,602 44.08%
over $181,232 up to $246,752 46.18% over $172,602 up to $235,675 46.18%
over $246,752 up to $252,752 49.80% over $235,675 up to $240,716 49.80%
over $252,752 53.5% over $240,716 53.5%
BC Basic Personal Amount Tax Rate BC Basic Personal Amount Tax Rate
$12,580 5.06% $11,981 5.06%

 

Federal Basic Personal Amount Tax Rate Federal Basic Personal Amount Tax Rate
$15,705 15% $15,000 15%

Canada Pension Plan

The maximum pensionable CPP earnings level for 2024 has increased by $1,900 to $68,500. Contributors who earn more than the $68,500 ceiling on pensionable earnings in the year 2024 are now required to pay more to the CPP.

The second level of CPP contributions begins in 2024. The CPP2 contribution rates for both employees and employers are set at 4.00%, with a maximum contribution limit of $188.00 each. For self-employed individuals, the CPP2 contribution rate is 8.00%, and the maximum self-employed contribution is capped at $376.00.

The basic exemption for 2024 remains at $3,500.

The basic employee and employer contribution rates for 2024 will remain at 5.95%, and the basic self-employed contribution rate will remain at 11.9% in 2024.

The maximum employer and employee contribution to the plan for 2024 will be $3,867.50 each and the maximum self-employed contribution will be $7,735.00. The maximums in 2023 were $3,754.45 and $7,508.90. (via Canada.ca) The increase in contribution amount is due to the continued implementation of the CPP enhancement.

Employment Insurance

The maximum EI earnings for 2024 have increased from $61,500 to $63,200. Contributors who earn more than the $63,200 ceiling on insurable earnings in the year 2024 are not required to contribute more to EI.

Employee contribution rates for the year 2024 will increase to 1.63% per $100. The maximum employee contribution to the plan in 2024 is now $1,049.12, up from $1,002.45 in 2023.

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
2025 $32,490 TBD
2024 $31,560 $32,490
2023 $30,780 $31,560
2022 $29,210 $30,780
2021 $27,830 $29,210

Permitted CCRA Withdrawals from an RRSP

Home Buyers’ Plan (HBP)

  • Limits: $35,000 per participant
  • Eligibility: ‘First time home owners’
  • Repayment: Within a period of no more than 15 years following the withdrawal

Lifelong Learning Plan (LLP)

  • Limits: $10,000 per year to a maximum of $20,000 over four years
  • Eligibility: either you or your partner must be enrolled in a qualifying educational program, minimum of three months duration
  • Repayment: Within a period of no more than 10 years following the withdrawal

TFSA (Tax-Free Savings Account)

  • Limits: $7,000 for 2024, a $500 increase from last year.
  • 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 reported 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.

FHSA (First Home Savings Account)

  • Limits: 8,000 contribution limit per year – Yearly contribution limit, and unused portions can carry forward to the following year. There’s a 1% penalty for every month you over-contribute until you correct the issue. $40,000 lifetime limit (Total contribution space over 15 years).
  • Like an RRSP, an FHSA reduces your taxable income — meaning a nice discount at tax time.
  • Like a TFSA, the growth in your investments (including dividends) can be withdrawn tax-free when used towards your first home, without any payback requirements.
  • If you don’t end up buying a home, you can transfer the money to your RRSP without affecting your RRSP contribution room.

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.