In most countries there are different types of taxes and levies that must be paid. There are often many variations that exist in states, countries and provinces all around the world. Taxes in Canada are no exception, as there are several sorts that exist that must be followed.

The primary concern of most citizens when it comes to taxes is the federal income tax that is levied by the national government. In Canada, the Canadian Revenue Agency (CRA) is the governing tax body for the nation. Most provinces also have their own tax agencies as well.

Canadian income tax consists of the majority of the annual revenues of the Government of Canada, and of the governments of the Provinces of Canada. Canadian federal income taxes, both personal and corporate are levied under the provisions of the Income Tax Act. Provincial and territorial income taxes are levied under various provincial statutes.

The Canadian income tax system is a self-assessment regime. Taxpayers assess their tax liability by filing a return with the Canadian Revenue Agency (CRA) by the required filing deadline. CRA will then assess the return based on the return filed and on information it has obtained from employers and financial companies, correcting it for obvious errors. A taxpayer who disagrees with CRA’s assessment of a particular return may appeal the assessment. The appeal process starts when a taxpayer formally objects to the CRA assessment. The objection must explain, in writing, the reasons for the appeal along with all the related facts. The objection is then reviewed by the appeals branch of CRA. An appealed assessment may be confirmed, vacated or varied by the CRA. If the assessment is confirmed or varied, the taxpayer may appeal the decision to the Tax Court of Canada and then to the Federal Court of Appeal.

Canada levies personal income tax on the worldwide income of individuals’ resident in Canada and on certain types of Canadian-source income earned by non-resident individuals. The amount of income tax that an individual must pay is based on the amount of their taxable income (income earned less allowed expenses) for the tax year.

If you are a nonresident of Canada and you render services in the country then you are entitled to pay income tax on the income that is generated by you by providing the services in the country under the provisions of the Canadian taxation of non-residents policy. There are regular continuous services that one might render and there are also some services that are rendered for a short span of time. If you are a consultant, or a lecturer providing your services then you will have to pay your taxes and will have to file your returns for the income earned in Canada. For people who are involved in the movie industry, they will have to refer to the Film Advisory Services to identify the tax credit that is available to them before filing the returns.

The Canadian taxation of non-residents considered 15% tax deduction at the source to be a rough estimate of the nonresident tax liability of the person. If you are covered by treaty protection or can show that your expenses are bound to be more you can apply for a waiver or tax reduction request to the concerned department.

Canadian income tax is considered to be the highest grosser of the annual revenues that is received by the Government of Canada. The tax is collected by the federal government on behalf of the Canadian provinces and territories (except Quebec) and the income tax system of Canada is administered by the CRA or Canadian Revenue Agency. Anyone who is working in Canada will have to pay Canadian income tax. The various federal tax rates levied are 15%, 22%, 26% and 29% depending on the value of the taxable income. The taxation year in Canada is from January to December and the Canadian tax return has to be filed by April 30th of the following year for salaried individuals and for self employed individuals the final date for receiving tax returns is June 15th.

Tax Filing for Canadian Residents

Canadian Income tax is levied on the worldwide income of Canadian residents. For non residents there are certain types of income that is earned from Canadian sources that are taxable. The Canadian residents will have to use the T1 Tax and Benefit Return and it is the same for individuals and sled employed individuals. The amount of tax that will have to be paid by the individual depends on the value of their taxable income. The taxable income is calculated by reducing the allowed expenses from the gross income received. There are different ways in which the Canadian tax for personal income is collected.

• Deduction at source – The tax is deducted from the pay of the individual and is paid to the CRA by the employer or the income source

• Installment payments – The tax payer will pay the estimated taxes during the year in various installments without waiting till the end of the year to settle the tax

• Payment on filing – The tax is paid when the income tax return is filed by the individual

• Arrears payment – The tax is paid after the tax return has been filed.

Federal Tax Rates

The Federal Tax Rates For The Year 2013 Is As Follows

• Tax rate of 15% is levied on the first $43,561 of the taxable income

• Tax rate of 22% is levied on the next $43,562 of the taxable income

• Tax rate of 26% is levied on the next $47,931 of the taxable income

• Tax rate of 29% is levied on taxable income above $135,054

This is the federal tax rate that is applicable for all territories and provinces of Canada except Quebec and the provincial or territorial tax rates will differ from one another.

Filing of Canadian Tax Return

There are three ways to file your Canadian tax return and they are

• NETFILE

• EFILE

• MAIL

NETFILE is the considered to be a process that is fast and easy and involves using the internet to file your returns online. One has to ensure that the returns are prepared using the web applications or commercial tax preparation software that has been certified by the CRA for the return to be accepted. EFILE is done with the help of electronic filing service providers who are registered with the CRA. The necessary documents are taken to the service provider who will fill in the details and file the return on your behalf. The tax return paper can also send across to the CRA using mail and the mail will have to be send to the CRA office that is responsible for tax services in your province or territory.

What Is Income Tax?

Income tax is the tax that is levied on the money that people earn and has to be paid to the national government. The term income is something that is looked at a different context in taxation and depending on the country; this context is also bound to change. There are a lot of different types of income tax systems that are being used all around the world and the way income is taxed is a lot different from one country to another. In some countries, only personal income is taken in the purview of income tax, and in some countries profit that is made by a company owned by the person is also taken into consideration for income tax. Income tax is something that you can’t avoid and therefore it is better to hire a tax expert to help you with income tax.

Canadian Income Tax

• Canadian income tax is considered to be the major contributor to the revenue of the Government of Canada.

• The collection of personal income tax is considerably higher than the collection of corporate income tax.

• The federal government of Canada collects the personal income tax on behalf of all the territories and provinces in Canada except Quebec.

• The corporate income tax is not collected in Alberta and Quebec territories by the federal government.

• The federal income tax system comes under the administration of the Canada Revenue Agency (CRA)

• Personal and corporate Canadian income tax that falls under federal income taxes are levied under the provisions of the Income Tax act.

• The territorial and provincial income tax are levied under the provincial statutes that are present in the different territories.

• The Canadian income tax system is based on a self-assessment model.

• The tax liability is assessed by people and then it is filed as a return to the CRA.

• The CRA then will assess the return filed and correct them if any errors are found.

Why Hire a Canadian Tax Expert to Help You with Taxes

Taxation is a complex process and it involves a lot of knowhow on the policies and rules that exist in any taxation policy. If you are looking to file your income tax return with the CRA and do not want any issues to come out of it, you can look at hiring a Canadian tax expert to help you file your income tax return. A Canadian tax expert will be well versed in income tax provisions and will be able to file your income tax returns a lot faster and also without obvious mistakes.

What to Be Aware of While Hiring a Tax Expert?

If you are planning on hiring a Canadian tax expert to help you in filing your income tax returns, there are a few things that you must look at before you do so. Always hire tax experts who have a good reputation as they will ensure that you will not have any issues related to income tax after filing your returns. Reputed tax experts will have the expertise and the much needed experience to get the income tax return filed correctly and on time. Cost of hiring a tax expert should not deter you as you may be able to save a lot more through tax planning advice that a tax expert will give you.

What Is Taxation All About?

Taxation is something that is prevalent in all countries and it is the revenue generator for governments to carry out infrastructure projects, development projects and projects that will help in developing the country. To generate revenue, there are taxes that are levied upon the citizens and the companies in a country based on their income and profits. Taxes are basically of two types and they are direct and indirect taxes. Direct tax is the tax that you pay directly to the government, for example income tax and indirect taxes are those that you will pay for the products and services you buy or utilize. The indirect tax amount is included in the cost of the product or service and this tax will paid to the government by the company or the service provider. There is a lot more when it comes to taxation but the nuances of taxes are best explained by tax experts.

Canadian Income Tax

• In Canada, income tax generates most of the annual revenues that are earned by the Government of Canada.

• Personal income tax collected is much more than the corporate income tax collected in Canada.

• Canadian income tax is levied under the provisions of the Income Tax Act of Canada and the tax collection is administered by the Canada Revenue Agency (CRA).

• As in many countries, the income tax system in Canada is based on self-assessment. The taxpayers of Canada assess their income themselves and identify their tax liability. Then the same is filed as an income tax return with the CRA.

• The CRA then analyses the return filed and will correct it if any obvious errors are found.

There are ways to save income tax in Canada, but for clear information on that you might want to consider the option of hiring a Canadian income tax expert to help you with it.

Canada-US Tax Treaty

• There is a Canada-US tax treaty that has been signed by the two countries with respect to Taxes that are levied on income and capital.

• The Canada – US tax treaty was first signed in September 1980 and there have been a few amendments to it over the years.

• Amendments were made to the Canada-US tax treaty in 1983, 1984, 1995 and 1997 to ensure that both governments were not subjected their citizens to double taxation and to prevent citizens from tax evasion.

Why Utilize the Services of a Canadian Income Tax Expert?

Though the income tax calculations in Canada seem to look simple, there are a lot of small intricate adjustments that can be done while filing your Canadian income tax. To help you in knowing where you can save on taxes, get the services of a Canadian income tax expert who will have good knowledge and experience of Income tax laws in Canada. If you do not have the time to prepare the tax return on your own, a Canadian income tax expert will get it done for you correctly and also in less time. Above all the tax expert can help you by saving you on what you pay as taxes not just for the current year, but also help you with tax planning for the years to come.