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5 Tax Changes in 2020 All Canadians Should Be Aware Of

In 2019, Canadians saw a slew of tax changes coming into effect, and it’s no different for 2020. While there may still be time until you have to file your taxes, keeping up to date with any tax changes and working with a Calgary tax accountant can help save you money and time.

Tax laws often undergo changes, which can be difficult and complex to keep up with. By working with a tax accountant, you can ensure that your business complies with tax laws. At Isaac Achal Professional Corporation (IAPC), our team of highly experienced and knowledgeable tax accountants make sure to stay on top of any current tax changes to ensure:

  • Fewer errors when preparing a client’s tax return
  • Fewer rejected returns due to such errors
  • Ultimate client satisfaction

At IAPC, not only can our tax accountants save you time and money, but we work with a network of professionals to help you with issues such as insurance needs, wills and estate goals, financial planning goals, tax assessment, and more.

Choose IAPC For All Your Financial Needs

With over 15 years of combined industry experience, our team of highly qualified tax accountants can perform a range of services for our clients in Calgary and Chestermere, including tax assessment, bookkeeping, and auditing, to meet all your financial needs.

Our team of chartered professional accountants take pride in providing you with fast and efficient services and a tailored approach to manage all your financial matters.

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5 Tax Changes You Should Be Aware Of in 2020

Tax laws change from one year to the next - sometimes dramatically - and if you are not up to speed on these latest changes, you could end up losing a lot of money. Working with a qualified and experienced tax accountant is one of the best ways to stay informed of such changes and such a professional can help save you a lot of time, money, and frustration.

Whether you’re working with a tax accountant or not, it never hurts to plan ahead, so here are some of the tax changes in 2020 that you should be aware of:

  1. Federal and provincial income tax brackets are increasing to keep up with inflation. The 2020 federal brackets will be: 0 to $48,535 of income (15%), above $48,535 to $97,069 (20.5%), above $97,069 to $150,473 (26%), above $150,473 to $214,368 (29%), with anything above that being taxed at 33%.
  2. Employment insurance premiums are decreasing from 1.62% in 2019 to 1.58% in 2020. This represents a reduction of 30 cents from the 2016 rate of $1.88, meaning that a worker who earns $48,000 annually in 2020 will pay $144 less in EI premiums compared to several years ago.
  3. Maximum pensionable earnings, the amount used by the government to calculate Canada’s Pension Plan contributions for the year is going up to $58,700 in 2020, up from the 2019 amount of $57,400. Similarly, the employer and employee contribution rates for 2020 will be going up to 5.25%, up from 5.1% in 2019.
  4. The Canada Child Benefit will continue to be indexed to inflation, as was the case last year. This means that in 2020, the maximum a parent can receive is $6,639 for children under the age of 6 (this has gone up from $6,496 in 2019) and $5,602 for children ages 6-17 years (up from $5,481 in 2019).
  5. Gradual increase to the BPA. The government announced that it is moving forward with its proposal to increase the BPA gradually to $15,000 by 2023. This means that in 2020, the new BPA will be $13,229. It will rise to $13,808 in 2021 and $14,398 in 2022. This increased BPA will translate to lower taxes for close to 20 million Canadians and once fully implemented in 2023, it may save individuals nearly $300 in additional taxes beyond the inflation-adjustments annually.

Struggling to Keep Up With 2020’s Tax Changes? We Can Help!

Keeping up with the constant tax changes every year can be hard! To gain some clarity on the above tax changes, or to find out how we can help you with all your financial needs, contact us at(403) 605-6887 or fill in our online contact form.

For any questions for Corporations including payroll, tax preparation and advice, reach out today!

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