What’s New for 2017 Tax Returns:

Federal Tax

Personal tax rate:

  • Lowest bracket: $11,635 to $45,916
  • Next bracket: $45,916 to $91,831
  • Then, $91,831 to $142,353
  • $142,353 to $202,800
  • A new high-income tax bracket for taxable earnings above $202,800. The top rate an individual in Ontario can expect to pay, combining both Federal and Provincial taxes is 53.31 %

Donations:

High income individuals taxed at the new 33% rate, will be eligible for a higher (33% up from 29%) donation tax credit to the extent their income exceeds $200,000. For instance, if a taxpayer contributed $10,200 to charity and had income for the year under $200,000 their donation credit would be the same as it was in previous years. If, however, they earned $205,000 and donated the same $10,200 then the first $200 would receive a 15% tax credit and the next $5,000 of the donation would be credited as it was in the past (29%) but the last $5,000 would receive the higher tax credit – because their earnings were $5,000 above the $200,000 threshold. Of course if the taxable earnings were $210,000 or higher than the full amount would be eligible for the higher credit (less the first $200 which receive a lower – 15% credit)