Employment Insurance is a federal program funded by employee and employer premiums that provides temporary income to eligible workers who lose their jobs or take certain leaves.
EI premiums are withheld from employees' insurable earnings up to an annual maximum, with the employer paying 1.4 times the employee's premium. EI funds regular benefits for job loss and special benefits such as maternity, parental, sickness and caregiving leave.
Most owners who control their corporation are generally not eligible for EI on their own employment and may be exempt from premiums, an important point in owner-manager payroll setup. Self-employed individuals can opt into EI special benefits voluntarily but not regular benefits.
An employee has EI premiums withheld up to the yearly maximum; the employer contributes 1.4 times that amount. If the employee is later laid off, they may claim EI regular benefits based on their insurable hours.
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HST combines the 5% federal GST with a provincial component in five participating provinces. For 2026 the combined rates are 13% in Ontario, 15% in New Brunswick, Newfoundland and Labrador, and Prince Edward Island, and 14% in Nova Scotia since 1 April 2025. Elsewhere you charge the 5% GST alone, or GST plus a separate provincial tax. The rate follows the province of supply, not where your business sits.
Current and prior-year forms and publications are free to download from canada.ca, and tax software builds most of them for you as you enter your information. You can also order a paper package by phone or pick one up at participating postal and service outlets during filing season. Which forms apply depends on your situation: a T1 with your slips for employment income, T2125 for self-employment, a T2 for a corporation, T1-ADJ to change a return already filed.
Filing is required once tax is owed, and also in several situations regardless of income, including selling property, repaying benefits, splitting pension income, or receiving a request to file from the CRA. Below the basic personal amount most people owe nothing, yet filing still pays: the Canada Child Benefit, the GST/HST credit and provincial credits are all calculated from a filed return. Check the basic personal amount for the year you are filing.
Canada taxes personal income in bands. Each bracket's rate applies only to the income inside that band, so earning your way into a higher bracket never re-taxes the income below it. Federal thresholds are indexed to inflation annually, and your province or territory applies its own set of brackets on top, which together give your combined marginal rate. Because the figures move every year, use the CRA rate table for the tax year you are filing rather than the current one.
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Reviewed and fact-checked by Udit Gupta
Ex Big 4 — Ernst & Young, Deloitte · International & cross-border tax specialist · CPA Canada (In-Depth Tax Program) · Chartered accountant, ICAI & MIA
Udit Gupta has over 15 years of experience helping corporations and business owners with corporate structuring, corporate tax filing, bookkeeping, payroll, GST/HST, cross-border tax and CRA representation. Big 4 trained at Ernst & Young and Deloitte, and qualified as a chartered accountant in India and again in Malaysia, he founded his accounting practice in 2014 to serve entrepreneurs, startups and non-resident business owners across Canada. View full member bio.
The Institute of Chartered Accountants of India — member 521458 · Malaysian Institute of Accountants — member CA 44667 · Ex Big 4: Ernst & Young, Deloitte · CPA Canada (In-Depth Tax Program), completed 19 Dec 2023 · In-Depth GST/HST Part I, 12 Jul 2022 · Part II, 5 Jul 2023
Editorial policy. Every page is researched against primary sources — the Income Tax Act, CRA publications and CPA Canada guidance — and every rate or threshold is stated with the tax year it applies to.
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