Tax Measures

PERSONAL:

Good news:

  • Increasing the non-refundable tax credit on charitable donations exceeding $200 per year effective 2018.

Bad news

  • Replacing the Ontario Surtax with new tax rates and tax brackets. Slight increase for higher income earners (above $71,500) effective 2018. The top tax rate of 53.53% (Federal and Ontario combined) for those earning $220,000 still applies.

What will my personal tax bill be for 2018?

PERSONAL TAX TABLE

Self Employed Taxable Income

($000’s)

 

Estimated Taxes

Including Ontario Health Premium ($000’s)

 

20 2
30 4
40 6
50 8
60 11
70 14
80 17
90 20
100 24
150 46
200 70
300 123
400 176
500 230

*In addition to the above, add CPP (maximum $5,128.20) if you are self-employed.

CORPORATE/BUSINESS:

 Bad news:

  • Adopting federal government changes on the restrictions of income splitting with family members.
  • Adopting federal government changes on reduction of small business deduction limit.
  • Changing the Employer Health Tax which could increase tax liability for some employers. Details are not available at this time.

What will your corporate tax bill be for calendar year?

Taxable Income $ 2018 Combined Federal & Ontario Tax Rate (%) 2019 Combined Federal & Ontario Tax Rate (%)
0 – 500,000 13.50% Between 12.50% to 26.5%*
500,001+ 26.50% 26.50%

* Subject to reduction of small business deduction based on passive income earned.
**Applies to active business income of a CCPC (i.e. DPC/H/TSC). Investment income of a corporation would be taxed at 50.17% tax rate.

This summary was prepared by DCY Professional Corporation Chartered Professional Accountants who have been advising dentists/doctors for decades. Additional information can be obtained by phone (416) 510-8888, fax (416) 510-2699, or e-mail david@dcy.ca, basil@dcy.ca, eugene@dcy.ca, louise@dcy.ca.  Visit our website at: www.dcy.ca. This article is intended to present tax saving and planning ideas and is not intended to replace professional advice.