2016 Tax Season Update #2
April 8, 2017 – Personal Income Tax
How much do we each pay for our health care in Ontario?
Health care has been in the news lately south of the border. Our health care in Ontario is paid through our personal tax system. The Ontario Health Premium is included on our pay stubs as part of income tax withheld, but did you know how much? The premium ranges from $0 if your taxable income is $20,000 or less, to $900 if your taxable income is more than $200,600.
A family would pay the premiums based on their own individual taxable incomes, so this also means that family members with little or no income (such as stay at home spouse, children, or other dependants) do not pay the premium.
Not bad, eh?
Don’t Forget to Report the Sale of Your Principal Residence on Your Tax Return!
Given the average price of a home in the Greater Toronto Area is $916,567, this new requirement to report the sale of your principal residence and exemption on your personal tax return for 2016 will be a huge tax grab if we are not careful.
Generalizing that there is no capital gains tax on the sale of your home is inaccurate. If your family happens to own another principal residence, such as a cottage, there will be capital gains tax on one of them, either the home or the cottage. The capital gains tax can be minimized with a formula used for the principal residence exemption. However, CRA will not allow the principal residence exemption if the sale is not reported on your tax return! You can ask CRA if you can amend the return, but a penalty may apply:
The penalty is the lesser of the following amounts:
- $8,000 or
- $100 for each complete month from the due date of your tax return to the date your request was made to amend the return
Notice to Reader
Dean Constand CPA publishes this blog for information purposes only. Feel free to distribute to colleagues and friends. Although the material has been carefully prepared, it is not a substitute for professional advice.