Personal Income Tax Measures in Federal Budget of 2011
Highlights of Personal Income Tax Measures in Federal Budget of 2011. This is very important information for families, self employed, sole proprietors and partnership businesses.
These tax incentives will cost the federal government about $35 million in 2010-11 and rising to $168 million in 2012.
Non-refundable Tax Credits ( Important to know, that you do not get any tax refund for these credits. These tax credits only can reduce your existing tax bill and give you a bigger share of tax refund).
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Obama Tax Cut Deal Will Cost U.S. For The Long Run
The Bush tax cut has been extended for two more years and it is now called the Obama Tax Deal.
Bush tax cut has been effective since 2002 when the U.S. economy was doing rather good. But since then, with housing market collapse and unemployment of millions of people, the economy has been spiraling downward.
It does not make any logical sense to me to claim that extending the Bush cut will create jobs for American People.
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Canada Revenue Agency Income Tax: CRA Income Tax payroll tax Tax Tax Rate US Tax
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How Much Tax Do You Pay on $50 Million Jackpot Winning?
After a $50 million Jackpot was won in Vancouver, people are curious as to how much tax do you pay for that Lotto winning?
The winners should thank their luck that they have won the Jackpot in Canada.
If they had won the Lotto in USA, they would have to pay 38% or more of their winning to IRS.
Since they have won it in Vancouver and are not U.S. citizens, their Tax liability to the Canada Revenue Agency is, “0”.
Lotto or any other lottery winning is not taxable in Canada.
As per Canadian Income Tax Act “Income from a source” of employment, business or investment is taxable income. Since lottery winning is not a regular source of income, not a single penny of the winning is Taxable under Canadian Income Tax Act.
Unfortunately it is a different situation for U.S. citizens or lottery winning in USA.
If you are a U.S. citizen, it does not matter where in the world you win a lottery; you must report and pay income tax on your lottery winning.
If you are not a U.S. citizen and you win lottery/gambling in U.S.A. 30% to 38% of your winning will be taken out and sent to IRS, before you are given the winning proceeds. You must file a Non-Resident Income Tax Return, to get the tax deducted at source back. How much you will get back, depends your foreign residential status and any tax treaty agreement between the USA and your country of residence.
Canada Revenue Agency Income Tax: CRA payroll tax Tax Rate
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Annual Contribution to CPP is Raised to $185 a Month
The CRA has increased the maximum pensionable earnings to $48,300. There is a CPP exemption on earnings up to $3,500. You do not pay any CPP if your annual earning is $3,500. The current CPP rate is 4.95% for both the employer and employee.
Since the CPP premium rate is unchanged, and the pensionable earnings went up, net CPP is up for both employees and employer. Maximum CPP premium will be $2,217.60 for employees and $4,435.20 for the self employed annually.
From Jan 1, 2011 EI premium is going up also.
So, expect to see a smaller pay cheque if your earnings remains the same in 2011.
Home Buyers Are Ignorant about HST in British Columbia and Ontario
I wrote about this myths about HST is causing a havoc in real estate market where HST was introduced in July 2009.
Home buyers are ignorant about HST and also real estate experts have failed to send the message about the net effect of HST to the prospective home buyers.
A recent study confirms my conclusion about HST and Real Estate market.