Tax Rates

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Personal tax brackets increased for inflation with no change to marginal rates. The highest combined marginal tax bracket of 49.8% begins on income in excess of $210,371. For 2019, BC has the 7th lowest top marginal rate (2018 – 8th).

The maximum annual contribution limit is $26,500 for RRSP’s and $6,000 for TFSA’s.

The Lifetime Capital Gains Exemption is $866,912 (Deduction – $433,456) for qualified small business corporation shares and $1 million for qualified fishing or farming property.

Maximum CPP pensionable earnings are $57,400. The contribution rate increased to 5.1% (2018–4.95%) for maximum CPP contribution of $2,749. Maximum EI insurable earnings are $53,100 with a maximum premium of $860.

The maximum CPP retirement benefit is $13,855 ($1,155/month) and the CPP post-retirement benefit is $346 ($29/month) for contributions made after you receive retirement pension, contributions are mandatory until 65.

Maximum OAS payments for the year are $7,217 ($601/month). OAS claw back begins at net income of $77,580 and is eliminated once net income exceeds $125,696.

For investment income, tax on regular dividends is lower than tax on capital gains until income reaches $40,707, after which capital gains become the less expensive option. Eligible dividends are grossed-up 38% and receive a 20.73% tax credit, they have a negative tax rate until income exceeds $47,630. Small business dividends are grossed-up 15% and receive a 10.38% dividend tax credit.

2016 Personal and Corporate Tax Rates
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