{"id":17998,"date":"2025-02-24T09:11:30","date_gmt":"2025-02-24T09:11:30","guid":{"rendered":"https:\/\/torontotribune.ca\/index.php\/2025\/02\/24\/tax-season-2025-what-canadians-need-to-know-before-filing-national\/"},"modified":"2025-02-24T09:11:30","modified_gmt":"2025-02-24T09:11:30","slug":"tax-season-2025-what-canadians-need-to-know-before-filing-national","status":"publish","type":"post","link":"https:\/\/torontotribune.ca\/index.php\/2025\/02\/24\/tax-season-2025-what-canadians-need-to-know-before-filing-national\/","title":{"rendered":"Tax season 2025: What Canadians need to know before filing – National"},"content":{"rendered":"


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Canada\u2019s tax season is now officially open \u2013 and there a few key changes<\/a> that could affect Canadian pocketbooks.<\/p>\n

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Starting Monday, Canadians can file their income tax and benefit returns online.<\/p>\n

\u201cConsidering all of the financial stress the Canadians are feeling right now, this might be a good year to take a bit of a closer look at your taxes to make sure that you are claiming every single tax credit that\u2019s available to you,\u201d said Clay Jarvis, a financial expert with NerdWallet Canada.<\/p>\n

The Canada Revenue Agency said it received more than 33 million returns last year and issued more than 19 million refunds \u2013 an average of $2,294.<\/p>\n

The deadline for most individuals to file and pay any taxes owed is April 30 after which they may face penalties and interest.<\/p>\n

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Self-employed Canadians have until June 16 to file their tax return, but any money owed should be paid before April 30 to avoid interest, according to the CRA<\/p>\n

Getting on top of your taxes early can pay off, especially if your tax situation is a bit more complicated, Jarvis said.<\/p>\n

\u201cI think sooner is always better when it comes to your taxes,\u201d he said.<\/p>\n

This will not only let people get a quicker refund, but also give more time to reach out to the CRA for help or track down receipts, Jarvis said<\/p>\n

\u201cGiving yourself a longer runway is going to make it a less stressful process and \u2026 you\u2019re going to get your money a lot faster,\u201d he said.<\/p>\n

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The federal income tax brackets are increasing by 2.7 per cent to account for inflation. That comes after a 4.7 per cent increase in 2024.<\/p>\n

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For 2025, federal tax is 15 per cent for earnings up to $57,375; 20.5 per cent between $57,375.01 and $114,750; and 26 per cent between $114,750.01 and $177,882.<\/p>\n

The tax rate is 29 per cent for earnings between $177,882.01 and $253,414, while anything more than that is taxed at 33 per cent.<\/p>\n

In addition, provinces and territories use their own personal income levels to calculate tax rates.<\/p>\n

The contribution limit for the registered retirement savings plan (RRSP) has increased to $32,490 for the 2025 tax year, up from $31,560 the year before.<\/p>\n

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Maximum pensionable earnings and contributions have also gone up.<\/p>\n

The Year\u2019s Maximum Pensionable Earnings (YMPE) for 2025 will be $71,300 \u2014 up from $68,500 the previous year.<\/p>\n

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The maximum contribution for employee and employer Canada Pension Plan has increased to $4,034.10 each\u2014up from $3,867.50 in 2024. But the contribution rate for 2025 remains unchanged at 5.95 per cent.<\/p>\n

The\u00a0self-employed\u00a0CPP contribution rate remains at 11.90 per cent, and the maximum contribution will be $8,068.20\u2014up from $7,735.00 in 2024,\u00a0according to the CRA.<\/a><\/p>\n

After two consecutives increases<\/a>, the contribution room for the tax-free savings account (TFSA)\u00a0will remain unchanged at $7,000.<\/p>\n

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For the 2025 tax year, the basic personal amount (BPA) \u2014 on which you do not pay federal income tax \u2014 ranges from $14,538 to $16,129, depending on your overall income.<\/p>\n

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That\u2019s up from 2024 figures, which range from $14,256 to $15,705. Those with lower incomes have a higher basic personal tax credit.<\/p>\n

As for Employment Insurance (EI), the maximum insurable earnings have increased to $65,700 \u2013 up from 63,200.<\/p>\n

For 2025, the maximum annual EI premium that an employee will pay is 1,077.48 \u2013 increasing from 1,049.12 in 2024.<\/p>\n

The maximum weekly EI benefit rate has also risen from $668 to $695 per week.<\/p>\n

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For the 2025 tax season, the CRA has made some updates to its website.<\/p>\n

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The federal tax agency said last month<\/a>\u00a0that it has \u201csimplified its sign-in process, making it easier to access the My Account, My Business Account, and Represent a Client portals with a single sign in.\u201d<\/p>\n

CRA account holders can now access all services in My Account, My Business Account, and Represent a Client\u00a0with one click as opposed to signing in separately, which was the case before.<\/p>\n

CRA has also rolled out a new document verification service and an online chat function that let\u2019s My Account users talk to a CRA agent if they run into any issues.<\/p>\n

\u201c<\/strong>If you\u2019re going to do your taxes yourself, I think you should always be looking into whatever digital services are there, either from the CRA or a CRA-approved tax filing service,\u201d Jarvis said.<\/p>\n