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Last updated: June 09 2021
Payroll Changes Effective July 2021
Walter Harder, DFA-Tax Services Specialist, DFA-Bookkeeping Services Specialist, RWM
Semi-annual payroll changes are implemented when announcements are made after January 1 that affect payroll deductions for income tax and statutory deductions. This year, no federal tax changes have been announced that affect payroll and only one province has announced a change that will affect provincial tax calculations.
So which province has the highest marginal tax rates? You may be surprised
In May 2021, the New Brunswick government announced that, effective January 1, 2021, the rate applicable to the lowest provincial bracket (income below $43,835 will be reduced from 9.68% to 9.4%. Since income tax was withheld in the months of January to July at the 9.68% rate, income tax will be withheld at a rate of 9.12% for July to December, bringing the average rate for the year 9.40%.
Thus, lower-income residents of New Brunswick will see a small increase in their take-home pay. For example, an employee earning $770 per week would receive about $4.32 per week as of July 1.
But, others in the Maritimes don’t fair as well. Nova Scotians for example now have the highest marginal tax rates at the upper end, as shown below from EverGreen Explanatory Notes:
|
NS |
Up to $8,481 $8,482 to $13,808 $13,809 to $29,950 $29,591 to $49,020 $49,021 to $59,180 $59,181 to $93,000 $93,001 to $98,040 $98,041 to $150,000 $150,001 to $151,978 $151,979 to $216,511 Over $216,511 |
0% 8.79% 23.79% 29.95% 35.45% 37.17% 38.00% 43.50% 47.00% 50.22% 54.00% |
0% 4.39 11.90% 14.98% 17.73% 18.59% 19.00% 21.75% 23.50% 25.11% 27.00% |
0% 6.67% 13.54% 20.62% 26.94% 28.92% 28.78% 36.20% 40.23% 43.93% 48.28% |
0% -0.11% -0.11% 8.39% 17.73% 18.35% 19.50% 27.09% 31.92% 36.36% 41.58% |
ADDITIONAL EDUCATIONAL RESOURCES: Knowledge Bureau Advanced Payroll Course.
Returning students: Please see Certificate Course Content highlights below and be sure to register by June 30 to take advantage of your VIP Grad Status discounts if you are a returning student.
New students: sign up for the Enhanced Certificate Program for volume discounts. We suggest the Basic Bookkeeping in a Digital World plus the Advanced Payroll Course if you want a good head start on your professional development this summer.
KBR Readers Bonus: receive an extra $50 tuition bonus when you register by June 30.
Advanced Payroll course highlights:
An incorrect approach to the technical side of payroll poses a risk to both employers and their employees: it can cost them money, cause them to incur penalties with the Canada Revenue Agency or worse face legal ramifications. Advanced Payroll will help you become a more astute compliance manager that prepares accurate payroll, who understands the necessary requirements of an employer, federally and provincially, and who can meet the demands of an evolving digital workforce.
