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Corporate tax
| Tax rate for resident companies |
The federal general corporate rate is 21% plus a 1.12% surcharge, with provincial rates bringing the effective tax rate to approximately 32%-38%.
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| Tax rate on long-term capital gains |
Taxable capital gains are included in taxable income and taxed at normal rates.
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| System governing groups of companies and dividends paid by subsidiaries to their parent companies |
Dividends are subjected to a restraint at source at the rate of 15% of their gross amount (5% if the actual beneficiary is a company other than a society, which directly possesses at least 10% of the rights to vote of the company which pays dividends),
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| Tax rate on branches |
The rate of branch profits tax is 25% which may be reduced depending on the tax residence of the corporation and the terms of any tax conventions between Canada and its country of residence.
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Income tax
| Fiscal year |
The fiscal year begins on January 1, and ends on December 31, of the same year.
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| Income tax rate |
The federal tax rate is progressive from 16% to 29% in 2003 and shared out into 4 brackets :
| Lower than 31,677 $ | 16% | | 31,677 $ - 63,354 $ | 22% | | 63,354 $ - 103.000 $ | 26% | | Beyond 103.000 $ | 29% |
The provincial income tax is calculated in percentage of the federal basic tax for all the provinces, except Quebec, Ontario and Alberta which perceive their taxes according to their own rules.
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| Tax deductions or other allowances |
There are several types of reductions or dejections in Canada: removal expenses, living allowances, investments etc.
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VAT rates
| Standard rates |
There is a Goods and Services sales tax (GST) which rate varies depending on the states between 6 and 14%.
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| Reduced rates |
4,5%
Exemptions are provided for basic foods, health care and education.
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