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Interest rates for the fourth calendar quarter
11-14-2016
The Canada Revenue Agency (CRA) today announced the prescribed annual interest rates that will apply to any amounts owed to the CRA and to any amounts the CRA owes to individuals and corporations. These rates will be in effect from October 1, 2016 to December 31, 2016.
There have been no changes to the prescribed interest rates since last quarter, except for the interest rate for corporate taxpayers’ pertinent loans or indebtedness.
Income tax
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The interest rate charged on overdue taxes, Canada Pension Plan contributions, and employment insurance premiums will be 5%.
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The interest rate to be paid on corporate taxpayer overpayments will be 1%.
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The interest rate to be paid on non-corporate taxpayer overpayments will be 3%.
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The interest rate used to calculate taxable benefits for employees and shareholders from interest-free and low-interest loans will be 1%.
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Change: The interest rate for corporate taxpayers’ pertinent loans or indebtedness will be 4.49%.
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CPP contribution rates, maximums and exemptions
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CPP contribution rates, maximums and exemptions
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Year
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Maximum annual pensionable earnings
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Basic exemption amount
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Maximum contributory earnings
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Employee and employer contribution rate (%)
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Maximum annual employee and employer contribution
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Maximum annual self-employed contribution
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2017
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$55,300
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$3,500
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$51,800
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4.95
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$2,564.10
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$5,128.20
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2016
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$54,900
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$3,500
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$51,400
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4.95
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$2,544.30
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$5,088.60
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2015
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$53,600
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$3,500
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$50,100
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4.95
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$2,479.95
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$4,959.90
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2014
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$52,500
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$3,500
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$49,000
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4.95
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$2,425.50
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$4,851.00
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2013
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$51,100
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$3,500
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$47,600
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4.95
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$2,356.20
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$4,712.40
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EI premium rates and maximums
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Federal EI premium rates and maximums
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Year
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Maximum annual
insurable earnings
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Rate (%)
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Maximum annual
employee premium
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Maximum annual
employer premium
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2017
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$51,300
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1.63
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$836.19
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$1,170.67
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2016
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$50,800
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1.88
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$955.04
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$1,337.06
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2015
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$49,500
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1.88
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$930.60
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$1,302.84
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2014
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$48,600
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1.88
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$913.68
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$1,279.15
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2013
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$47,400
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1.88
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$891.12
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$1,247.57
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Federal Rates
The basic rate of Part I tax is 38% of your taxable income, 28% after federal tax abatement.
After the general tax reduction, the net tax rate is 15%.
For Canadian-controlled private corporations claiming the small business deduction, the net tax rate is 11%. This rate will decrease to:
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10.5% effective January 1, 2016
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10% effective January 1, 2017
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9.5% effective January 1, 2018
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9% effective January 1, 2019
Federal tax rates for 2016
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15% on the first $45,282 of taxable income, +
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20.5% on the next $45,281 of taxable income (on the portion of taxable income over $45,282 up to $90,563), +
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26% on the next $49,825 of taxable income (on the portion of taxable income over $90,563 up to $140,388), +
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29% on the next $59,612 of taxable income (on the portion of taxable income over $140,388 up to $200,000), +
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33% of taxable income over $200,000.
Footnotes: Footnotes: This column is presented as a general source of information only and is not intended as a solicitation for business. Mohammed Yasin, CPA,CGA, is the principal of M. Yasin & Co. Inc., Certified General Accountants and has offices in Vancouver & Surrey,B.C.
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