2023 Tax Season In Canada: Your Guide To Credits, Benefits, Changes, Deadlines & Penalties

And much more!

Senior Editor
The flag of Canada with an office building in the background. Right: A sign marking the Canada Revenue Agency headquarters in Ottawa, Ontario.

The flag of Canada with an office building in the background. Right: A sign marking the Canada Revenue Agency headquarters in Ottawa, Ontario.

It's time to calculate taxes in Canada. As taxpayers begin to navigate the tricky web of information out there, they'll have multiple factors to consider to ensure their tax return is complete and that they're maximizing their deductions and opportunities to earn those sweet refundable tax credits. It's even trickier for Quebecers, who, unlike most Canadians, have to file two separate returns.

Here's a guide to tax season in Canada, including how much income tax you can expect to pay at the federal and provincial levels, some of the biggest credits and benefits available to you, the filing deadline and the penalties for missing it.

What is the Canada 2022 tax deadline?

The Canada tax filing deadline is usually on April 30. But since that date falls on a Sunday in 2023, taxpayers get a one-day extension, to Monday, May 1, 2023.

What is the provincial tax rate for the 2022 tax year in my province?

Each province has its own income tax brackets and rates on top of a federal income tax.

Tax brackets are ranges of income that each have their own tax rate, represented by a percentage. The system is marginal, meaning taxpayers pay a different rate for each segment of their taxable income. Tax rates increase for higher levels of income.

In Ontario for the 2022 tax year, for example, taxpayers will have forked up 5.05% of their first $46,226 of taxable income; 9.15% of any additional income between $46,226 and $92,454; 11.16% of anything between $92,454 and $150,000; 12.16% of taxable income between $150,000 and $220,000; and 13.16% of anything else above $220,000.

Here's a complete breakdown of the income tax brackets and rates in every Canadian province for the 2022 tax year.

What are the Quebec income tax brackets and rates?

The Quebec 2022 income tax brackets and rates are as follows:

  • 15% on the first $46,295 of taxable income,
  • 20% on additional income between $46,295 and $92,580,
  • 24% on additional income between $92,580 and $112,655,
  • and 25.75% on any income over $112,655.

What are the Canada income tax brackets and rates?

The Canada federal 2022 income tax brackets and rates are as follows:

  • 20.5% on income between $50,197 and $100,392,
  • 26% on additional income between $100,392 and $155,625,
  • 29% on additional income between $155,625 and $221,708,
  • and 33% on any income above $221,708.

How can I reduce my Canada tax bill or increase my tax refund?

There are several tax credits and benefits that could reduce or offset Canadians' overall tax bill.

Major programs include the Canada Child Benefit (CCB) for families; the GST/HST Credit, which gives back some of the money low-income households pay in federal sales tax; the Canada Workers Benefit, financial support for low-income workers; and the Canada Housing Benefit, which gives some extra money to low-income renters.

Taxpayers may also be able to claim certain medical or moving expenses, and up to $10,000 for the purchase of a qualifying home.

One major Quebec-specific program is the Solidarity Tax Credit, an additional, refundable credit for low-income individuals and families.

Is there a tax credit for working from home in Canada?

Yes. Thanks to a measure that dates back to the beginning of the COVID-19 pandemic, taxpayers in Canada can claim up to $500 for working from home. There are two different methods for claiming the work-from-home tax credit, depending on taxpayers' situations.

Here's a breakdown of Canada's work-from-home tax credit.

Are there any changes to Quebec taxes this year?

Yes. Revenu Québec has published a list of changes affecting 2022 taxes. They include a change to the application process for the tax credit for childcare expenses, a doubling of the tax credit for the purchase of eligible homes, and changes to the list of eligible expenses for the medical expense tax credit.

Here's Revenu Québec's complete list of principal changes affecting the 2022 tax year.

What updates has the CRA announced for the 2022 tax year?

Changes relevant to the 2022 tax year at the federal level in Canada include adjustments to income tax brackets and benefits to account for inflation, and increases to expense or contribution limits for certain tax credits and tax-exempt savings accounts.

Here's the CRA's full breakdown of changes for the 2022 tax year in Canada.

How do you file taxes in Quebec?

Quebecers have to file two tax returns, one for federal taxes with the Canada Revenue Agency (CRA) and another for provincial taxes with Revenu Québec. That dual filing scheme dates to the 1950s and persists — despite its tediousness and repeated calls for consolidation — due to disagreements about the balance of power between the federal and provincial governments.

Here's the history of the two-tax-return system in Quebec and how it could finally come to an end.

How do RRSPs and TFSAs affect your taxes?

Registered Retirement Savings Plans (RRSPs) and Tax-Free Savings Accounts (TFSAs) are "savings vehicles" that allow residents of Canada to set aside some money without paying some of the taxes to those sums, and the interest their earn, would otherwise be subject.

Here's a breakdown of how RRSPs and TFSAs work.

What are the consequences for missing the tax filing deadline?

Late Canada federal tax return filers will incur a financial penalty equal to 5% of an unpaid balance plus an additional 1% for each month that passes without a filed return, up to 12 months.

What are some common tax scams in Canada?

The CRA is warning of several tax scams in Canada this year. They include texts from senders claiming to represent the CRA and offering tax credits, asking to verify personal information or threatening legal action. The goal of all of these texts is to lure recipients into sharing financial information or scare them into making a payment.

Here's the CRA's list of potential tax scams and advice for avoiding them.

Thomas MacDonald
Senior Editor
Thomas MacDonald is a Senior Editor for MTL Blog focused on Montreal public transit and is based in Montreal, Quebec.
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