I hope that 2024 has treated you well. There have been a few changes during the year.
Please read through this letter and the attached income and deductions checklist; use it to assemble your information for me. If you had a proprietorship (self-employed income) or rental income, additional checklists are created just for you. If you need either one, just let me know, and I’ll send it to you.
You can also download them here.
E-file Opens: February 24th (first date to file)
First 60 Days for RRSP: ends March 3rd
Standard Filing Date: April 30th
Interest Start Date: April 30th
(interest date for proprietorships owing tax or CPP)
Filing Date (self-employed): June 16th (June 15th is a Sunday)
Personal tax brackets (Provincial and Federal), personal exemption and other tax credits (age, dependent, etc.) have been adjusted for inflation.
For example, the federal personal credit has been adjusted for inflation to $16,129 for 2025. (an increase of $424.00 over 2024).
OAS clawback starts at $93,454 (90,997- 2024). Age credit clawback starts at $ 45,522 ($ 44,325 – 2024)
The tax-free savings accounts (TFSAs) additional contribution room for 2025 is $ 7,000. If you have not made any TFSA contributions to date, your total contribution room would be $102,000. (and qualified for the account in the first year available) If you have made TFSA contributions in the past, please contact me to find out your current limit. Any withdrawals made in 2024 will increase your 2025 limit.
The FSHA, similar to the RRSP, enters its third year. The maximum amount deductible this year is $8,000. CRA has limited the carryforward to the maximum of one year of unused contributions (i.e. $8,000). If you opened your FSHA in 2023, but made no contributions, your maximum for this year would be $16,000. The lifetime limit is $40,000.
Contributions are deductible, similar to RRSP. The account's value increase is treated similarly to TFSA (non-taxable). If used for a home purchase, there is no tax impact for the withdrawal or any repayment requirements. If not withdrawn for home purchase within 15 years, it can be rolled into RRSP without impact to RRSP room available.
In the 2024 Budget the Government of Canada proposed an increase to the inclusion rate of Capital Gains over $250,000 to 2/3 (~67%) up from 1/2 (50%). While this legislation hasn’t past CRA is taking direction from the “Ways and Means” (budget) this tax year.
https://www.canada.ca/en/department-finance/news/2024/06/capital-gains-inclusion-rate.html
The CPP maximum earnings increases to $73,100 ($68,500 2024). The rate remains the same at 5.95%. The maximum contribution $4,031.10 each for employer and employee ($3,867.50 2024).
The additional CPP contributions for those earning $81,000 or more ($73,200 2024) will remain at 4% and the maximum contribution will be $396.00 each for employer and employee.
CRA has decreased the interest rate on outstanding balances to 8% starting January 2025.
Several major changes to alternative minimum tax will affect tax planning, it will affect taxpayers with income above $ 173,205 in 2024. If you meet this income threshold, donating securities to charity, charity donations, capital gains, qualifying small business shares gains, carrying charges, and moving and childcare costs could be less effective in reducing taxes payable.
This calculation under the current or new program does not apply in the year of death, so high income in this period does not trigger the tax. Give me a call if you would like additional details.
Bare Trusts, were everyone is a Canadian Citizen, are not required to file either the UHT or Trust Returns this year. (This is usually when children are on title for financial planning or parents on title for financing).
Laven Accounting Ltd.
Copyright © 2025 Laven Accounting Ltd. - All Rights Reserved.
Powered by GoDaddy
We use cookies to analyze website traffic and optimize your website experience. By accepting our use of cookies, your data will be aggregated with all other user data.