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Individual - Sample personal income tax calculation
Last reviewed - 15 December 2023This sample calculation applies to a calendar year ending 31 December 2023.
Assumptions
- Resident husband and wife living in Alberta; two children (under 18); one spouse earns all the income.
- Total remuneration of CAD 110,000.
- Capital gains of CAD 16,000.
- Foreign interest income of CAD 5,000, from which CAD 750 withholding has been deducted.
- Other interest income of CAD 6,000.
- All amounts are in Canadian dollars (CAD).
Tax computation
| CAD | CAD | |
| Net income | ||
| Salary | 110,000 | |
| Interest | 11,000 | |
| Taxable capital gain (one-half of actual gain) (1) | 8,000 | |
| Enhanced government pension plan deduction | (631) | |
| Net income/Taxable income | 128,369 | |
| Income tax (see the Taxes on personal income section): | ||
| Federal tax before credits | 24,572 | |
| Less - Personal credits: | ||
| Basic | 2,250 | |
| Spouse | 2,250 | (4,500) |
| Less - Other credits: | ||
| Employment tax credit | 205 | |
| Government pension plan and employment insurance plan contributions tax credit | 619 | (824) |
| Basic federal tax | 19,248 | |
| Less - Foreign tax credit | ||
| Lesser of 750 and (5,000 / 128,369) x 19,248 = 750 | (750) | |
| Federal income tax | 18,498 | |
| Provincial (Alberta) income tax (2) before credits | 12,837 | |
| Less - Personal credits: | ||
| Basic | (2,100) | |
| Spouse | (2,100) | |
| Government pension plan and employment insurance plan contributions tax credit | (413) | |
| Alberta tax | 8,224 | |
| Total income tax (3, 4) | 26,722 |
Notes
- Assuming the capital gains are not in respect of qualified farm property, qualified fishing property, or shares of a small business corporation, no capital gains deduction is available.
- In Alberta, the following rates are applied to taxable income in 2023.
Taxable income (CAD) Tax on first column (CAD) Tax on excess (%) Over Not over 0 142,292 0 10 142,292 170,751 14,229 12 170,751 227,668 17,644 13 227,668 341,502 25,043 14 341,502 40,980 15 - Personal tax credits and miscellaneous tax credits are subtracted from the result to determine Alberta tax. The 2023 Alberta personal tax credit for the government pension plan and employment insurance plan contributions is equal to 10% (maximum credit is CAD 413) of the lesser of the base (non-enhanced) amounts payable and the required base premiums for the year.
- The taxpayer does not have sufficient tax preference items to be liable for AMT.
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