Tung Shanghera Accounting Solutions Bookkeeping taxes tax firm

Tung Shanghera Accounting Solutions
Key personal income tax changes for the 2016 year

Below are some of the key personal income tax changes that will be relevant for most individuals

  • The federal tax highest tax bracket (i.e. over $200,000) rate has increased from 29% to 33%
  • The federal tax second lowest tax bracket (i.e. $45,282 – $90,563) rate decreased from 22% to 20.5%

 

The revised federal tax rates are as follows:

Bracket $0 – $45,281 $45,282 – $90,562 $90,563 – $140,387 $140,388 – $199,999 > $200,000
Federal Rate 15% 20.5% 26% 29% 33%
  • The BC provincial 16.8% tax rate that applied on taxable income over $151,050 has been eliminated

 

The revised BC provincial tax rates are as follows:

Bracket $0 – $38,209 $38,210 – $76,420 $76,421 – $87,740 $87,741 – $106,542 $106,543
BC Rate 5.06% 7.7% 10.5% 12.29% 14.7%
  • The family tax cut tax credit is eliminated. In prior years, this allowed some families with children under 18 to reduce their tax bills by up to $2,000.
  • The Canada Child Benefit was introduced in July 2016. This is a non-taxable benefit which has replaced the Universal Child Care Benefit and the Canada Child Tax Benefit.
  • The Tax-free savings account (TFSA) contribution limit for 2016 decreased to $5,500 from $10,000
  • The fitness credit maximum for eligible dependents will decrease to $500 from $1,000 in 2015. Note that this credit will be fully eliminated after December 31, 2016
  • The art credit maximum for eligible dependents will decrease to $250 from $500 in 2015. Note that this credit will be fully eliminated after December 31, 2016

 

If you need any assistance with your personal tax filings, please contact us at admin@tsascpa.com

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