If this is your first time here, You may want to subscribe to ADJ via RSS. If you are reading this page via RSS reader, you can visit the main page here – Canada’s Personal Finance Blog.
Canada 2009 Budget
Canadian Finance Minister James M. Flaherty released the 2009 Federal Budget yesterday. Looks like after 11 years of surpluses, we will have a $33.7 billion deficit in the next fiscal year, reaching a total deficit of $80 billion in the next five years. Most probably, we will move back to positive territory after 2013 or 2014. This is how one of the best performing economies among G7 nations looks like.
Today, I am going to present some important highlights that will affect you directly:
- The basic personal amount, the spousal and common-law partner amount, and the eligible dependent amount will increase to $10,032 in 2009 (from $9,600 in 2008)
- The upper limit on the lowest personal income tax bracket (taxes income at 15%) will increase to $40,726 in 2009 (from $37,885 in 2008)
- The upper limit on the second personal income tax bracket (taxes income at 22%) will increase to $81,452 in 2009 (from $75,769 in 2008)
- A new Home Renovation tax Credit will be in place. It lasts one year and is worth up to $1,350 per household. This credit applies to expenditures in excess of $1,000 but not more than $10,000 at 15% from January 28, 2009 to February 1, 2010.
- Home Buyers’ Plan withdrawal limit increases to $25,000 (from $20,000)
- A new First Time Home Buyers’s Tax Credit is being introduced. This non refundable tax credit is equal to $5,000. To get the dollar value, multiply this by the lowest personal income tax rate. It works out to be 15% X $5,000 = up to $750.
- Age credit for seniors will increase by $1,000 to $6,408. The income level at which age credit is fully phased out increases to $75,032 (from $68,365)
These are just some highlights I have picked. For more information about this budget, visit Canada’s Economic Action Plan Budget 2009
Some hand-picked posts you may want to read: