November 2016
Looking back at 2016 & forward to 2017
Mariya Honcharova, CPA, CA, & Sankalp (Sunny) Jaggi, CPA, CA, MTax, CFF are tax managers in the Toronto office of Collins Barrow.
Federal Highlights
Canada Child Benefit – The Canada Child Tax Benefit (CCTB) and Universal Child Care Benefit (UCCB) were replaced with the Canada Child Benefit. The Canada Child Benefit will provide a maximum benefit of $6,400 per child under the age of 6 and $5,400 per child between ages 6 and 17. The amount of the benefit will be based on combined family net income reported in the previous taxation year. The amounts received under the Canada Child Benefit are not taxable. Children’s Fitness and Arts Tax Credit – For the 2016 taxation year, the children’s fitness and arts tax credit maximum eligible amount will be reduced from $1,000 to $500 and $500 to $250 respectively. Both credits will be eliminated for the 2017 and subsequent taxation years. Income Splitting for couples with children – This measure previously introduced by the Harper government has been eliminated by the Trudeau government. Teachers and Early Childhood Educator School Supply Tax Credit – Starting with the 2016 taxation year, eligible educators may claim a 15 per cent refundable tax credit on eligible expenditures up to a maximum of $1,000.
Provincial Highlights
Small business rate and thresholds – The threshold in Manitoba increased from $425,000 to $450,000 on January 1, 2016 and to $500,000 starting in 2017. Alberta’s 2016 budget decreased the small business income tax rate from 3 per cent to 2 per cent effective January 1, 2017. New Brunswick decreased its small business tax rate from 4 per cent to 3.5 per cent effective April 1, 2016. Personal income tax – For 2016, the federal marginal tax rate on income between $45,283 and $90,563 was reduced from 22 per cent to 20.5 per cent while the top marginal tax rate increased from 29 per cent to 33 per cent for income in excess of $200,000. The British Columbia top marginal personal tax rate decreased from 16.8 per cent to 14.7 per cent on income over $106,543. The Alberta marginal tax rate on income between $125,001 and $150,000 increased from 10.5 per cent to 12 per cent, on income between $150,001 and $200,000 increased from 10.75 per cent to 13 per cent, on income between $200,001 and $300,000 increased from 11 per cent to 14 per cent and on income in excess of $300,000 increased from 11.25 per cent to 15 per cent. New Brunswick’s 2016 budget eliminated the top marginal personal income tax rate of 25.75 per cent and lowered the rate on income in excess of $150,000 from 21 per cent to 20.3 per cent. Newfoundland and Labrador’s 2016 budget introduced an increase to all personal income tax rates.
Other topics include:
International highlights; Entrepreneurs; Personal tax matters; United States matters; International matters; Key tax dates
Collins Barrow periodically publishes Tax Alert, Flashes, Bulletins and Planners for its clients and associates. They are designed to highlight and summarize the continually changing tax and business scene across Canada. While the various tax publications suggest general planning ideas, we recommend professional advice always be sought before taking specific planning steps.

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