Economical QuickBooks Setup and Support for Canadian Businesses

Canadian income tax is built up in layers. You total your income for the year, subtract the deductions you qualify for to arrive at taxable income, then apply the federal brackets and your province's brackets to that figure. Each bracket rate applies only to the income sitting inside it, so earning more never retaxes the dollars below. Non-refundable credits, starting with the basic personal amount, come off the tax afterwards. Look up the CRA bracket table for the tax year you are filing.

For the 2026 tax year, federal rates are 14% on the first $58,523 of taxable income, 20.5% from there to $117,045, 26% to $181,440, 29% to $258,482, and 33% above that. Each rate applies only to the income inside its own band, so moving into a higher bracket does not raise the tax on the income below it. Provincial or territorial tax is added on top.

Multiply the pre-tax price by the rate for the province of supply. On a $100 purchase in 2026 that is $13.00 in Ontario (13%), $14.00 in Nova Scotia (14%), and $15.00 in New Brunswick, Newfoundland and Labrador or Prince Edward Island (15%). In the non-participating provinces and the three territories only the 5% GST applies, so $5.00, plus any provincial sales tax billed separately.

A write-off is simply a deductible expense. You subtract it from the income it helped earn, so the saving equals the expense multiplied by your marginal tax rate, not the full amount spent. To qualify, the cost must be incurred to earn business or employment income, be reasonable in amount, and be backed by a receipt. Purely personal costs never qualify, and mixed-use items such as a vehicle or a home office are split by business-use proportion.

No. The federal adoption expense credit is non-refundable, so it reduces tax you owe and cannot by itself create a refund. If your tax payable is already nil, the credit produces nothing. Eligible expenses are claimed in the tax year the adoption is finalised, and two adoptive parents can split one claim up to the annual maximum. Some provinces offer a separate credit of their own. The CRA's adoption expenses page lists what qualifies and the current limit.

HST in Newfoundland and Labrador is 15% in 2026: the 5% federal GST plus a 10% provincial component. It increased from 13% to 15% on 1 July 2016 and has stayed there. Sellers charge it on most goods and services supplied into the province, including businesses based outside it. Basic groceries are zero-rated and long-term residential rent is exempt, so neither carries the 15%.

If you are registered for GST/HST, record expenses net of the tax and claim the tax portion as an input tax credit on your GST/HST return. Deducting it as an expense as well would claim the same amount twice. If you are not registered, the tax you paid is simply part of the cost and is deducted with it. Keep supplier invoices showing the tax and the supplier's registration number, because the CRA can ask for them.

Yes. Wine, beer and spirits are taxable, so GST/HST applies at the rate for the province, 13% in Ontario. Alcohol also carries federal excise duty and, in most provinces, a provincial markup or liquor levy, which are built into the shelf price before sales tax is calculated. In Quebec, QST at 9.975% applies on the pre-GST price alongside a specific alcohol levy. Restaurant and bar alcohol is taxable the same way.

Telecommunications services are taxable, so the bill carries 5% GST plus whatever provincial tax applies where the service is supplied: 7% PST in British Columbia, 6% in Saskatchewan, or the provincial part folded into HST at 13% in Ontario and 14% in Nova Scotia since 1 April 2025. Alberta and the territories see only the 5% GST. A business can recover the GST or HST portion as an input tax credit; PST is not recoverable.

The TFSA dollar limit is $7,000 for 2026, and it was also $7,000 for 2025 and 2024. The limit is indexed to inflation and rounded to the nearest $500, so it can rise in later years. You need to be 18 or older with a valid social insurance number, and room accumulates for each year from the year you turn 18 in which you are resident in Canada, whether or not you file a return or open an account — years in which you were not a resident of Canada add no room.

Unpaid property tax is not normally reported to Canadian credit bureaus, so paying it late does not usually show up in your score on its own. The risk is different: a municipality can add interest, register the arrears against title and eventually start a tax sale, and if you borrow to clear the bill that loan does affect your credit. Check your municipality's tax collection page for its arrears process.

Double taxation is lawful, and relief comes through credits and treaties rather than exemption. A Canadian resident taxed abroad on foreign income normally claims a foreign tax credit, while Canada's tax treaties cap withholding and decide which country taxes first. Inside Canada, corporate profits paid out as dividends carry a gross-up and dividend tax credit so the combined burden approximates a single level of tax. US LLCs are a common trap, since Canada usually treats one as a corporation.