Term
| Progressive or graduated tax |
|
Definition
| A tax system in which tax rates increase for higher incomes. |
|
|
Term
|
Definition
| Income ranges in which the same marginal tax rates apply. |
|
|
Term
|
Definition
| Amounts that reduce a tax liability. |
|
|
Term
|
Definition
| Amounts that reduce taxable income. |
|
|
Term
|
Definition
|
|
Term
|
Definition
| Taxes paid / taxable income. |
|
|
Term
|
Definition
| The percentage of the last dollar you earn that goes toward taxes, i.e. if you earn $70,000 or more it would be 26%. |
|
|
Term
|
Definition
| Income on which the payment of taxes is postponed until some future date. RRSP and RRP are tax deferred. |
|
|
Term
|
Definition
| An asset you own, except for certain business assets, including stocks, bonds, real estate, or collectibles. |
|
|
Term
|
Definition
| What you make or lose after selling a capital asset. It is taxed at 50%. |
|
|
Term
| Taxable gains / allowable capital losses. |
|
Definition
| The amount of capital gain/loss that is included/deducted from your income. *Allowable capital losses can only be used to reduce taxable capital gains. |
|
|
Term
|
Definition
| The movement into higher tax brackets because of inflation increasing wages. |
|
|
Term
| Canada Pension Plan (CPP) |
|
Definition
| A federal program that provides retirement benefits based on years worked, amount paid into the plan, and retirement age. Employee pays 4.3%, employer pays 4.3%. |
|
|
Term
| Employment Insurance (EI) |
|
Definition
| The federal government's insurance program to provide limited-term benefits to those workers that have lost their jobs. Employee pays 2.25%, employer pays 3.15%. |
|
|
Term
| Employment and business income |
|
Definition
| Income that comes from working for someone else or for yourself. |
|
|
Term
|
Definition
| Income that comes from owning property such as rental buildings, bonds, and stocks. |
|
|
Term
|
Definition
| The sum of all your income from all sources. |
|
|
Term
|
Definition
| Total income less allowable deductions. Deductions include gifts, inheritances, child support, income tax refunds, lottery winnings, retirement payments, and moving and alimony payment. |
|
|
Term
| Registered pension plan (RPP) |
|
Definition
| a retirement plan offered by your employer where you each contribute a percentage of your salary to the plan. Contributions are tax deductible. |
|
|
Term
| Registered Retirement Savings Plan (RRSP) |
|
Definition
| A retirement plan that is independent from a RRP. You control how much you contribute - it can be up to 18% of the previous years income or $13,500 whichever is lower - and where the money is invested. |
|
|
Term
| Childcare expenses deductables |
|
Definition
| For children under 7, a max of $7,000. For children 7 - 16, a max of $4,000. For children with mental/physical disabilities, a max of $10,000. It includes boarding school fees, sports schools, and/or camps. |
|
|
Term
| Moving expenses deductibles |
|
Definition
| If you move 40 or more kilometers away for a new job or business, the costs are deductible. This includes shipping fees, travel costs for you and your family, hotel & meal costs, real estate fees, and legal fees. |
|
|
Term
|
Definition
| A tax credit that reduces income. |
|
|
Term
|
Definition
| A tax credit that recognizes the increased cost of marriage. |
|
|
Term
| Equivalent to spouse tax credit |
|
Definition
| A tax credit that is available for single parents whose children are under 18. |
|
|
Term
|
Definition
| A tax credit for those 65 or older. An attempt by government to recognize that the cost of living increases with age. |
|
|
Term
| Student-related tax credit |
|
Definition
| A tuition and education tax credit. 1)the tuition amount paid qualifies as a tax credit, 2) full-time students can claim 16% on $400 each month, and part-time students can claim 16% on $120 each month. And 3) the interest on a student loan is a tax credit. |
|
|
Term
| Charitable donation tax credit |
|
Definition
| The governments attempt to promote and reward donations to charities. For donations of more than $200, you get a 29% tax credit. Also, spouses can combine donation amounts to benefit from this extra tax credit. |
|
|
Term
|
Definition
| An attachment to an income tax return, on which you provide additional information regarding income and deductions. |
|
|
