Dear friends,

I get almost 25% of my total earned money deducted under various tax titles / EI , etc.Does it mean that at the time of annual tax return submission, i will not have to pay any tax / money on the income thus earned. Thanks

Donot worry Hasni !
If you are getting almost 25% of your total earned money out of your paycheque and you are in a low income bracket (say your gross earnings is not more than $ 600 per week), you will get a refund for sure. You will not be paying more. I assure you that.

The reason why they are deducting more is that you might not signed the standard deduction form in which around $ 15,000 / annum of your earning are removed before tax is applied to it. Now when you file the tax for this year, they will consider this.

As I said before, always ensure that your total gross income is around $ 35,000 to $ 40,000 per annum. Then only you will get full benefits for your entire family at the maximum levels (like CCTB, Child benefit, HST credit, Ontario fitness credit and the like).

When you file the end tax, see that you contribute some of your taxable earnings toward RRSP so that your tax burden will still come down. It will not be refund to you, but atleast it is deferred income tax amount. In the future, if you earn well, you donot care about tax. If in the future, you donot earn well, withdrawal from RRSP will not attract any tax for you.

Murali

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I am a Gents and not a Ladies.

Quote:

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Originally posted by tamilkuravan


always ensure that your total gross income is around $ 35,000 to $ 40,000 per annum.

Murali

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Dear TK,

Please explain the following:

A. The reason why they are deducting more is that you might not signed the standard deduction form in which around $ 15,000 / annum of your earning are removed before tax is applied to it. Now when you file the tax for this year, they will consider this.

B. When you file the end tax, see that you contribute some of your taxable earnings toward RRSP so that your tax burden will still come down. It will not be refund to you, but atleast it is deferred income tax amount. In the future, if you earn well, you donot care about tax. If in the future, you donot earn well, withdrawal from RRSP will not attract any tax for you.

Hasni,
I donot know your salary but I am expecting that it is only around $ 12- $ 13 an hour. In that case 25% deduction is too much. You should only be getting 18-20% deduction.
Your company HR would give you a form to sign to get this standard deduction. Looks like she has not done it.

Apart from this, my comments are self explanatory. If you still did not understand it, please google along those lines and find out. Only when you know some basic things, will you be able to find out for yourself, if something is amiss.

You give us only limited things for us to understand. So our comments are also generic. You should be able to put 1+1 yourself or give us all info.. incl your salary details, deduction details etc..

Murali

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I am a Gents and not a Ladies.

Thanks for explaining TK. I am working in a company through recruiting agency and i get pay cheque from the agency. I am paid @ 18 C$ per hour, though overtime done is times five. My deductions include FED tax, EI and CP.

Hello Hasni,

You will receive a t4 form at the end of the year. This will give a total of all payment made to you including overtime, EI/CPP etc. CPP and EI are paid by employer and employee - till a cap is reached. Taxation is paid based on salary per month calculated on an annual basis - so percentage of amount may differ each month based on number of hours worked and overtime earned (which is at 1.5 times regular rate).

Usually, a higher tax is collected - and you will end up receiving a refund when you file tax. This is received directly into your account after a few weeks or can be collected immediately from H&R block (or whoever files your tax - if the provide such a service) after deducting a small fee.

You can go online and check any salary calculator for your province. The cra site also gives you the CPP/EI contribution details. Check income tax slabs. Educate yourself. If you are going to live here and work here - get your facts right from the correct sources first. Anything you don't understand thereafter can be clarified here.

Hope that helps.