Tax Tidbits
Some quick points to consider…
- The government has proposed to reduce the tax rate on the lowest bracket to 14% (from 15%) effective July 1, 2025, resulting in reduced tax for many individuals. This change would be implemented as a 14.5% rate for 2025 and 14% for 2026 onwards. However, the rate for personal tax credits would likewise be reduced, resulting in lower tax credits. Employers were expected to implement this change on a best effort basis for the first pay of July 2025.
- Applications for the new Canada disability benefit are now open and can be made through an electronic application portal, by phone or in person at a Service Canada centre. This is an income-tested benefit intended for working-age people who are approved for the disability tax credit.
- CRA launched a new self-evaluation and learning toollink (SELT) to help taxpayers assess eligibility for penalties and interest relief due to financial hardship, circumstances beyond the taxpayer’s control, actions of CRA or other reasons.
- The government has reiterated that the Canada carbon rebate for small businesses should be tax-free, retroactive to the start of the program (available in AB, SK, MB, ON, NB, NS, PEI and NL). Draft legislation has been released. Once it receives Royal Assent, CRA will be authorized to process amended T2 corporation income tax returns for businesses that previously included the rebate in their taxable income.
