Moving to Canada comes with the responsibility of understanding how taxes work in your new country. Whether you’re here permanently, for work, or for studies, dealing with taxes is inevitable. We break down what you need to know, in a guide for newcomers to understand Canadian taxes.
The Basics of Canadian Taxes
Taxes are collected by the federal, provincial/territorial, and municipal governments of Canada. These taxes fund various government programs and services, including infrastructure, education, healthcare, and social welfare.
Income Tax in Canada
Residents of Canada must pay income tax on their earnings. This is managed by the Canada Revenue Agency (CRA). If you’re employed, taxes are automatically deducted from your salary throughout the year. If you’re self-employed, you must pay your income tax in a lump sum or in installments. Each year, you must submit an Income Tax and Benefit Return to report your income and tax payments to the government.
Tax Filing Deadlines
Residents of British Columbia, for example, must file their income tax forms with the federal government by April 30th each year. Even if you have no income in Canada, you must still report any income earned outside the country. Additionally, if you’re self-employed or own a business, you have until June 15th to file your income tax form, but any taxes owing must still be paid by April 30th. You can submit your tax forms by mail, phone, or online.
Deductions and Credits
As a Canadian taxpayer, you may be eligible for deductions and credits that can reduce your tax bill or increase your refund. Keeping records of your expenses is crucial for claiming these benefits.
Provincial or Territorial Taxes
In addition to federal taxes, you’ll also need to pay provincial or territorial taxes. Each province has its own tax rules, so it’s essential to understand what applies to you.
Getting Help with Taxes
Navigating taxes as a newcomer can be complex. Fortunately, there are services like Personal Tax Advisors that specialize in assisting new Canadians with their tax filings. Additionally, there are various free resources available to help you understand and manage your taxes effectively.
Understanding and managing your taxes is an important aspect of settling into your new life in Canada. By familiarizing yourself with the tax system and seeking assistance when needed, you can ensure compliance and make the most of available benefits and credits.
The Canadian Revenue Agency
Learn about your taxes – Develop an understanding of how the Canadian tax system works. Take this online course to learn about personal income taxes in Canada.
Learn about tax benefits and credits through webinars and recordings
The Surrey Libraries
- Learn about income tax clinics and some of the tax programs that you may benefit from.
- It is worth filing income tax, especially for lower income people. You can only get these benefits if you qualify and file income tax yearly.
DIVERSECity
- DIVERSEcity Income Tax Clinic offers free income tax clinics from March to April annually.
- A DIVERSEcity volunteer, trained by the Canada Revenue Agency can help you prepare and file your return.
Progressive Intercultural Community Services (PICS) Society
- Through the Community Volunteer Income Tax Program (CVITP), PICS host free tax clinic where volunteers complete tax returns for people with a modest income and a simple tax situation.
- Book an appointment to receive help with your taxes.
Sunshine Coast Resource Centre
- The Sunshine Coast Resource Centre is a host organization for the Community Volunteer Income Tax Program (CVITP) in collaboration with Canada Revenue Agency (CRA).
- CVITP is available all year, free of charge to everyone who meets the eligibility criteria.
BC211
- 211 offers information on organizations that offer free or low cost tax help.
- 211 offers many free, confidential services in over 240 languages and dialects. Dial or text 211 anytime to search the online directory.
NewToBC
- The NewToBC site offers an assortment of Settlement Information for Newcomers, including information on taxes for new Canadians.
- You can ask your local library about tax clinics in your community as well.
Understanding and managing taxes in Canada is an essential part of settling into your new life in the country. Whether you’re here permanently, temporarily, for work, or for studies, being aware of your tax obligations is crucial. By staying informed and proactive about your taxes, you can effectively manage your finances and focus on enjoying your new life in Canada.