VANCOUVER, British Columbia, Jan. 31, 2019 (GLOBE NEWSWIRE) -- The tax season doesn’t just mean filing your income tax return, but also preparing for the next one. Getting a head start can help you better prepare for the year and reduce the taxes you may owe. Here are some of changes you should be aware of for 2019.
Share benefits with your partner
Expected to launch on March 17, 2019, the parental sharing benefit will provide an additional five weeks of benefits when both parents share these benefits, or an additional eight weeks for those who choose the extended parental benefit option. This incentive is intended to encourage both parents to take some leave when welcoming a new child.
Contribute more to CPP and less to EI
As of January 1, 2019, our Canada Pension Plan (CPP) contributions have gone up, and will continue to increase for the next four years. At the start of this year, CCP contributions increased from 4.95 per cent to 5.1 per cent on earnings between $3,500 and $57,400.
If you make an annual salary of $51,000, you can expect to pay an additional $71.25 in your 2019 CPP contributions. This amount will be matched by the employer. Note that CPP contributions will be increasing every year until 2023, when the rate will reach 5.95 per cent.
Partially offsetting increased CPP contributions will be a decrease in Employment Insurance premiums, which will drop from $1.66 to $1.62 per $100 of insurable earnings.
Pay half of your premium
Your B.C. Medical Services Plan (MSP) premiums will remain the same this year, after reducing by half in 2018, and will be fully eliminated by 2020. A new B.C. Employer Health Tax is now in effect to cover the costs of the MSP premiums.
Save more with your TFSA
Beginning January 1, 2019, you can contribute up to $6,000 to your Tax-Free Savings Account (TFSA). If you’ve never contributed to a TFSA, your lifetime contribution is up to $63,500.
Claim your speculation and vacancy tax exemption
Don’t forget to complete your annual declaration for the speculation and vacancy tax if you live in Metro Vancouver, Kelowna, West Kelowna, parts of the Fraser Valley, the Capital Regional District, Nanaimo, or Lantzville. If you share the property with your partner, both of you must complete the declaration by March 31, 2019.
Not registering your household as exempt will result in an additional tax bill charged to you this summer, based on the assessed value of your home.
Be sure to visit CPABC’s RRSP and Tax Tips at rrspandtaxtips.com in February 2019 for updated tips on income tax filing for the 2018 tax year.
NOTE TO JOURNALISTS: CPAs are available for interview.
Please credit Chartered Professional Accountants of British Columbia (CPABC) for use of the content and include the following disclaimer: Tax rules relating to these RRSP tips are complex. This is not intended as tax advice, and you should not make tax decisions based solely on the information presented in these tips. You should seek the advice of a chartered professional accountant before implementing a tax plan or taking a tax filing position.
About CPA British Columbia
The Chartered Professional Accountants of British Columbia (CPABC) is the training, governing, and regulatory body for over 36,000 CPA members and 5,000 CPA students and candidates. CPABC carries out its primary mission to protect the public by enforcing the highest professional and ethical standards and contributing to the advancement of public policy. CPAs are recognized internationally for bringing superior financial expertise, strategic thinking, business insight, and leadership to organizations.