An Overview Of Canadian Income Tax Policies

By Author: Ken Donaldson
Total Articles: 48
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In most countries there are different types of taxes and levies that must be paid. There are often many variations that exist in states, countries and provinces all around the world. Taxes in Canada are no exception, as there are several sorts that exist that must be followed.

The primary concern of most citizens when it comes to taxes is the federal income tax that is levied by the national government. In Canada, the Canadian Revenue Agency (CRA) is the governing tax body for the nation. Most provinces also have their own tax agencies as well.

Canadian income tax consists of the majority of the annual revenues of the Government of Canada, and of the governments of the Provinces of Canada. Canadian federal income taxes, both personal and corporate are levied under the provisions of the Income Tax Act. Provincial and territorial income taxes are levied under various provincial statutes.

The Canadian income tax system is a self-assessment regime. Taxpayers assess their tax liability by filing a return with the Canadian Revenue Agency (CRA) by the required filing deadline. CRA will then assess the return based ...
... on the return filed and on information it has obtained from employers and financial companies, correcting it for obvious errors. A taxpayer who disagrees with CRA’s assessment of a particular return may appeal the assessment. The appeal process starts when a taxpayer formally objects to the CRA assessment. The objection must explain, in writing, the reasons for the appeal along with all the related facts. The objection is then reviewed by the appeals branch of CRA. An appealed assessment may be confirmed, vacated or varied by the CRA. If the assessment is confirmed or varied, the taxpayer may appeal the decision to the Tax Court of Canada and then to the Federal Court of Appeal.

Canada levies personal income tax on the worldwide income of individuals’ resident in Canada and on certain types of Canadian-source income earned by non-resident individuals. The amount of income tax that an individual must pay is based on the amount of their taxable income (income earned less allowed expenses) for the tax year.

If you are a nonresident of Canada and you render services in the country then you are entitled to pay income tax on the income that is generated by you by providing the services in the country under the provisions of the Canadian taxation of non-residents policy. There are regular continuous services that one might render and there are also some services that are rendered for a short span of time. If you are a consultant, or a lecturer providing your services then you will have to pay your taxes and will have to file your returns for the income earned in Canada. For people who are involved in the movie industry, they will have to refer to the Film Advisory Services to identify the tax credit that is available to them before filing the returns.

The Canadian taxation of non-residents considered 15% tax deduction at the source to be a rough estimate of the nonresident tax liability of the person. If you are covered by treaty protection or can show that your expenses are bound to be more you can apply for a waiver or tax reduction request to the concerned department.

About Author:-
Ken Donaldson is a chartered accountant who practices as an independent tax consultant. He also author of Canadian taxation of non-residents, in this article he provides canadian income tax tips. For more information you can visit Taxca.com.