Provincial Tax Round Up 2024

With all the news around the release of the April 16 federal budget in the busiest weeks of tax season, you may have missed what’s happened in provincial taxes for 2024.  Here’s a provincial tax round up to help you make sense of client queries you might get about relocations in 2024 as relates to personal tax changes.  Which is the best province to move to, from a tax filing point of view?  Personal tax budget highlights include:

British Columbia: February 22, 2024

• New British Columbia Family Benefit Bonus, enhancing the BC Family Benefit by 25%.
• Increase to the Climate Action Tax Credit effective July 1, 2024.
• Training Tax Credits extended until the end of 2025.
• New Home Flipping tax for 2025 .

Nunavut: February 26, 2024

There were no new tax measures introduced by the territory of Nunavut in the 2024-2025 budget.

Alberta: February 29, 2024

• New personal tax bracket introduced over the next two years (8% on the first $60,000 in 2025, 9% in 2026, back to 8% in 2027).
• Tax bracket and credit amounts indexed to 4.2%.

Nova Scotia: February 29, 2024

Effective January 1, 2025. Nova Scotia will implement indexation to the provincial personal income tax system, subject to annual adjustment. The following non-refundable tax credits will also be indexed:

• Basic personal amount
• Spouse or common-law partner amount.
• Amount for an eligible dependant.
• Age amount
• Amount for inform dependants aged 18 or older.

More Opportunity for Skilled Trades and Occupations Tax Refund (MOST) program has been expanded to include nurses under the age of 30, working in an eligible nursing position and a valid license. 

Prince Edward Island: February 29, 2024

The following tax changes have been proposed during the February 29, 2024 budget for Prince Edward Island:

• 2025 provincial tax rates will decrease for first four brackets and increase for the last.
• PEI Children’s benefit introduced for 2025.  Will be administered by the CRA.
• Tax rebates for builders: including rebates of HST and property taxes.
• Coordinated Vaping Tax with Federal Government.

Yukon: March 7, 2024

There were no new tax measures introduced by the territory of Yukon in the 2024-2025 budget.

Quebec: March 12, 2024

There were no changes to personal or corporate rates or the small business deduction in this budget. However, there were changes announced to the refundable tax credit that supports allowances to families with disabled children after June of 2024. 

Changes were also announced to ensure that starting January 1, 2025, seniors aged 65 or over with disabilities, will  no longer be subject to a retirement pension reduction.

Newfoundland and Labrador: March 20, 2024

There were no new tax provisions or increases introduced, however the Newfoundland and Labrador budget did table a reduction in Small Business Tax from 3% to 2.5% - effective January 2024.

New Brunswick: March 19, 2024

The following tax related changes were introduced in the March 19, 2024 budget in New Brunswick:

• A new non-refundable personal income tax credits for eligible volunteer firefighters and search and rescue volunteers, effective for the 2024 taxation year. This introduces a claim of up to $5,000 under Bill 27.
• Low-Income Senior’s Affordability Supplement benefit of $200 available April 1, 2024.
• Low income Senior’s Benefit increase proposed for 2025 taxation year, to $600 from $400.

Saskatchewan, March 22, 2024

The 2024 budget did not introduce any new direct personal tax changes.

Ontario: March 26, 2024

March 26, 2024 Ontario provincial budget promised several taxation system reviews and some tax relief for motorists and wine tasters.  Specifically,  a review of Ontario’s tax system was initiated in the 2023 Budget, but since consultations with experts, economists and business leaders continue without conclusions. 

Manitoba: April 2, 2024

Manitoba is planning to claw back the Basic Personal Amount, starting with tax year 2025.  The BPA is estimated to be $16,206 and the clawback will be based on net income,  Line 23600 of the federal T1.  The clawback amount will be 8.1 cents per dollar for every dollar over $200,000; with the full basic amount clawed back when net income reaches $400,000.  If fully clawed back, the provision will cost those taxpayers approximately $1750 more  (10.8% x $16,206). 

Depending on the final calculations (not presented with the Budget), this calculation, based on net income, could also increase taxes for high earners who qualify for the Northern Residents Deduction, or for those with one-time transactions like the sale of a farm or business which normally qualify for the capital gains exemption.  It may also affect retired business owners who generate a larger portion of retirement income from private dividends.

Stay tuned for a discussion on changes to Marginal Tax Rates, as affected by the new capital gains inclusion proposals next time in Knowledge Bureau Report and in the May 22, 2024 CE Savvy Summits