Canada Income Tax Rates for 2014
Canada Income Tax Brackets
|Tax Bracket (yearly earnings)||Tax Rate (%)|
|$0 - $40,970||15.00%|
|$40,970 - $81,941||22.00%|
|$81,941 - $127,021||26.00%|
|$127,021 and up||29.00%|
Canada has a bracketed income tax system with four income tax brackets, ranging from a low of 15.00% for those earning under $40,970 to a high of 29.00% for those earning more then $127,021 a year.
How does the Canada Income Tax compare to the rest of the world?
Canada has one of the lowest income taxes in the world, charging a maximum income tax of 29.00%. Countries with similar tax brackets include Mexico with a maximum tax bracket of 30.00%, Finland with a maximum tax bracket of 30.00% and Poland with a maximum tax bracket of 32.00%. Keep in mind that our ranking measures only nationwide income taxes, and does not account for local income taxes at state, province, or municipal levels.
|Maximum Income Tax||Income Tax Allowance||World Tax Rank|
|29.00%||$1,557 ($1,342 USD)||26th of 34|
What is the Canada Income Tax?
Canada's personal income tax is a bracketed income tax that must be paid yearly by all citizens to the government of Canada. Failure to pay, or underpayment of, the Canada income tax can result in high fees, fines, or jail time.
In addition to Canada's income tax, other taxes may apply to wages or profits earned, including social services, medical care, and capital gains taxes.
Canada Income Tax Allowance
Canada provides most taxpayers with an income tax allowance of $1,557, which can be kept as a tax-free personal allowance. Canada's tax credit is a basic wastable tax credit, non-tapered, available to all (single) taxpayers without dependents.
A tax credit is a fixed amount of money that may be kept by taxpayers without paying any income taxes. Generally, a tax credit is subtracted from your gross income before your taxable income is calculated.
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