Canada

Canada's individual tax summary reflects all 2024 federal, provincial, and territorial budgets. The summary is based on enacted and proposed legislation and assumes that the proposed legislation will become law. Generally, budget proposals and draft legislation are enacted into law, even with a minority federal government, which is currently the case. For more details of the proposed new individual tax measures noted in the summary, see our Tax Insights on the 2024 federal budget at www.pwc.com/ca/budget.

Capital gains inclusion rate

Draft legislative proposals increase the capital gains inclusion rate from one half to two thirds for the portion of capital gains realised by individuals after 24 June 2024 that exceeds an annual 250,000 Canadian dollars (CAD) threshold. See Capital gains in the Income determination section and our Tax Insights 'Finance releases draft legislation to increase the capital gains inclusion rate' (28 August 2024 update) at www.pwc.com/ca/taxinsights for more information.

Canadian Entrepreneurs' Incentive

Draft legislative proposals introduce the Canadian Entrepreneurs' Incentive, which will reduce the taxes on capital gains from the disposition of certain shares of a small business corporation owned directly by an eligible individual. See Canadian Entrepreneurs' Incentive in the Income determination section for more information.

Alternative minimum tax for high-income individuals

For taxation years that begin after 2023, recently enacted legislation increases the alternative minimum tax rate and exemption and broaden its calculation base. See Alternative Minimum Tax (AMT) in the Taxes on personal income section and our Tax Insights ‘Changes to the alternative minimum tax are enacted: How will it affect individuals and trusts starting 2024?' at www.pwc.com/ca/taxinsights for more information.

Reporting requirements for trusts

New tax return filing and information reporting requirements for trusts have come into effect for taxation years that end after 30 December 2023. The new rules require trustees to gather and report significantly more information; the filing deadline for a trust with a 31 December 2023 taxation year-end was 2 April 2024. However, for the 2023 and 2024 taxation years, the Canada Revenue Agency (CRA) does not require 'bare trust' arrangements to file this return, unless the CRA makes a direct request for it. Draft legislative proposals (i) reduce the number of trusts, including bare trust arrangements, that would need to file a trust return (and report certain additional information), and (ii) defer the start of the revised bare trust filing requirement until the 2025 taxation year. See Reporting requirements for trusts in the Other issues section and our Tax Insights 'Finance proposes to reduce the scope of the enhanced trust reporting rules' (1 November 2024 update) at www.pwc.com/ca/taxinsights for more information.