Feeds Topics Living Abroad Intending to immigrate to Canada? You should know about Canada's tax system

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    The Canada Revenue Agency (CRA) is responsible for enforcing tax laws on behalf of the federal government and most provinces and territories, as well as administering various social and economic benefit and incentive programmes funded by the tax system.

    Harmonized Sales Tax

    The Harmonized Sales Tax (HST) of 13% is added to the price of most products and services in Ontario. It comprises a federal Goods and Services Tax of 5% and a provincial sales tax of 8%. Some commodities and services, such as food, children’s clothing, and energy, may be taxed less or not at all.

    Personal income tax

    As an employee, income tax will be deducted from your paycheck by the federal and provincial governments to pay for public services. You will also see deductions for:

    • Canada Pension Plan (CPP)
    • Employment Insurance (EI)
    • Union dues (if you belong to
      a union)
    • Company pension plans (if
      you are entitled to one)
    • Other things you and your
      employer have agreed to.

    the Government of Canada for more information about paying
    income tax

    Business taxes

    The sort of business you operate determines how you record your business income, the taxes you pay, and many other aspects of your business. In Canada, the most common types of enterprises are sole proprietorship, partnership, and corporation. Learn about the impact your structure decision may have on your company:

    Tax on currency brought into Canada

    When you arrive in Canada, you will not be taxed on the money you bring with you.

    Your settlement worker will be able to provide you with information and referrals to help you understand the Canadian tax system once you arrive.

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