The Canada Revenue Agency (CRA) advises people to prepare early and know their benefits as tax season approaches. These perks can lower taxable income or save taxes.
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These are the three benefits to consider while filing taxes in 2024
1. Higher Basic Personal Amount: The BPA hike is a major tax adjustment. Canadian taxpayers will receive a 4.1% tax rise in 2023 with a BPA of $15,000. Federal income taxes are waived for those earning less than this threshold, but those earning more can deduct the BPA.
2. First-Time Home Buyers’ Tax Credit (HBTC): The recipients can receive $10,000 in tax relief in 2023. Credit might contribute to a $1,500 tax credit or rebate. Couples can divide the HBTC, and disabled people may qualify if eligible for the Disability Tax Credit.
3. Maximising RRSP Contributions: RRSP contributions expire on February 29, 2024, so maximize them to reduce taxable income. The 2023 RRSP contribution ceiling is 18% of earned income, up to $30,780. Contributions made in the first 60 days of 2024 are tax-deductible for 2023. The article highlights the benefits of holding dividend equities in an RRSP, citing Canadian Western Bank’s 4.36% payout.
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Tax Benefits: Early Preparation and Credit Awareness
Since taxes are filed annually, the piece stresses early preparation and tax credit understanding. It recognizes the stress and labor of tax filing but encourages people to enjoy it.
The CRA’s advisory emphasizes tax benefits and urges early tax season preparation. Understanding and obtaining tax credits can reduce tax payments and simplify filing.
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