It's what's left after tax that counts

What you can do now to lower your future tax bill.

Gail Bebee 12 June, 2015 | 5:00PM
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Each year at this time, the Canada Revenue Agency corresponds with millions of Canadians. The letters it sends -- known as notices of assessment -- contain the results of CRA's evaluation of 2014 income-tax returns. The arrival of your assessment notice is an excellent time to do some tax planning for the coming year. Acting now to arrange your finances in a more tax-efficient manner will mean a lower tax bill next April.

Estimating your marginal tax rate (the rate on your next dollar of income earned) in 2015 is a good place to start. Unless you expect major changes in income, your 2014 marginal rate is a reasonable proxy. It is based on your taxable income, which you can find on line 260 of your 2014 notice of assessment.

Your marginal tax rate depends on where you live because Canadians pay both federal and provincial/territorial income taxes, and the latter vary by jurisdiction. Canada has a progressive income-tax system, so tax rates rise with increasing income. The rate also depends on the type of income.

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About Author

Gail Bebee

Gail Bebee  Gail Bebee is an independent personal finance speaker, teacher and the author of No Hype--The Straight Goods on Investing Your Money. She can be reached at; her website is

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