Changes for 2021 Income Tax Season
February 10th, 2022
Posted in: Tax
Inflation has been the big financial story for the last couple of months, and it plays a big role in the changes we’re going to see for 2021’s income tax season.
From the CRA website
Deadline Dates
Mar. 1, 2022 – deadline to contribute to Registered Retirement Savings Plan (RRSP), Pooled Registered Pension Plan (PRPP), or Specified Pension Plan (SPP).
Apr. 30, 2022 – deadline for tax filing.
Apr. 30, 2022 – deadline to pay taxes.
Jun. 15, 2022 – deadline for self-employed taxes.
Basic Personal Amount (BPA) Tax Credit
BPA for 2022 has been increased to $14,398.
If you earn $221,708 or more, your BPA will be $12,719.
Canada Pension Plan (CPP) Rate
CPP rate for employees for 2022 is 5.70% (10.9% total when combined with employer rate).
Maximum contributions by employers and employees is $3499.80.
Self-employed people have maximum contribution amount of $6999.60.
Maximum pensionable earnings is $64,900.
Employment Insurance (EI) Premiums
EI premiums will remain at 1.58% for employees, up to a maximum contribution of $952.74.
Maximum insurable earnings are $60,300.
Maximum EI Premium payable by employers is $1333.84.
TFSA Limit
Remains the same at $6000.
RRSP Contribution Limit
RRSP limit for 2022 is $29,210 (also limited to 18% of your 2021 earned income).
Canada Child Benefit (CCB)
“The Canada Child Benefit (CCB) amount for the first half of 2022 is:
Maximum of $6,833/child/year under age 6 and up to $5,765 per child from age 6-17.
For the second half of 2022, it is:
Maximum of $6,997/child/year under age 6 and up to $5,903 for those aged 6-17.”
- Per SavvyNewCanadians.com
Canada Recovery Benefit (CRB), Canada Recovery Caregiving Benefit (CRCB), Canada Recovery Sickness Benefit (CRSB)
Reminder: any of these benefits received in 2021 are taxable.
You should receive at T4A from Canada Revenue Agency (CRA) and enter the payments on your 2021 Income Tax return.
These benefits may have had tax withheld at the source, but you might owe additional taxes on them.
Work From Home
Flat rate of $2 for home office expense deduction for every day worked at home due to the pandemic continues for 2021 income tax year.
Maximum claim increased from $400 to $500 for 2021 and 2022 tax years.
Here’s a video doing a nice overview of taxation in Canada.
Now is a good time to start thinking about getting your income taxes done for the 2021 tax year. We would love to help you get everything organized, and do some tax-planning as well.
Contact Shaw & Associates Chartered Accountants for accounting help you can count on. One complimentary meeting with us will put you and your business on a more profitable and positive path.