Question 1

What are the Canadian federal tax brackets for 2025?

Accepted Answer

Canadian federal tax brackets for 2025 are: 15% on income up to $55,867, 20.5% on income from $55,867 to $111,733, 26% on income from $111,733 to $173,205, 29% on income from $173,205 to $246,752, and 33% on income above $246,752. These brackets are indexed annually for inflation.

Question 2

How is CPP calculated in Canada for 2025?

Accepted Answer

Canada Pension Plan (CPP) contributions for 2025 are calculated at 5.95% of pensionable earnings between the basic exemption ($3,500) and the Year's Maximum Pensionable Earnings (YMPE) of approximately $68,500. The maximum CPP contribution for employees is approximately $3,867.50 per year.

Question 3

How do provincial taxes work in Canada?

Accepted Answer

In Canada, you pay both federal and provincial income taxes. Each province sets its own tax brackets and rates. For example, Ontario has rates from 5.05% to 13.16%, Alberta has a flat 10% rate on lower brackets going up to 15%, and Quebec has the highest rates at 14% to 25.75%. Provincial taxes are calculated on your taxable income after the federal calculation.

Question 4

What is the basic personal amount in Canada for 2025?

Accepted Answer

The federal Basic Personal Amount (BPA) for 2025 is approximately $15,705. This is the amount you can earn before paying federal income tax. The BPA is reduced for higher earners: it starts decreasing when income exceeds approximately $173,205 and reaches a minimum of $14,156 for income above $246,752.

Question 5

How much is EI (Employment Insurance) in Canada for 2025?

Accepted Answer

Employment Insurance (EI) premiums for 2025 are 1.64% of insurable earnings up to the Maximum Insurable Earnings (MIE) of approximately $63,200. The maximum annual EI premium for employees is approximately $1,036.48. Quebec residents pay into the Quebec Parental Insurance Plan (QPIP) instead at different rates.

🇨🇦 Canada Tax Calculator 2025 - Federal & Provincial Taxes

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🇨🇦 Canada Tax Calculator 2025 - Federal & Provincial Taxes

Calculate Your Canadian Tax Liability

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