Pension deductions in Canada will increase from 2023
Starting Jan. 1, 2023, Canadian taxpayers will contribute more of their income to the state.
Under the new Canada Revenue Service plan, those earning more than $66,000 CAD a year will have to pay more of their earnings to build up retirement benefits. The monthly amount will increase by $21.22 CAD per month, which would increase annual deductions by $254.65 CAD.
This growth is related to the increase in average wages across Canada.
Regular payment of taxes is the responsibility of all residents of Canada: those who work in the country and earn income. Income taxes are assessed differently in each of the provinces, and the final amount depends on the amount earned.
Let's compare deductions to the pension fund:
- in 2022, employees of public companies would contribute a maximum of $3,500 CAD, and the self-employed would contribute $6,999 CAD;
- In 2023, the first category's deductions will increase to $3,754 CAD, and for the second, to $7,508 CAD.
This is the maximum amount of deductions to the tax authority of the country.
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