Ontario Budget 2017

    Ontario Finance Minister Charles Sousa delivered the province’s 2017 budget on April 27, 2017. The province’s 2017 budget is balanced, with projected balanced budgets for 2018 and 2019.

    Corporate Income Tax Measures

    No changes to corporate taxes were announced.

    Corporate Income Tax Rates- As of January 1, 2017
    Ontario Combined Federal & Ont
    General 11.5% 26.5%
    M&P 10.0% 25.0%
    Small Business* 4.5% 15.0%
    *on first $500,000 of active business income

     

    • Review of tax planning strategies involving private corporations: Ontario intends to review tax planning strategies involving private corporations
      • Income splitting with family members
      • Passive investment portfolio inside a corporation
      • Converting regular business income to capital gains
    • Employer Health Tax Exemption: Changes to prevent the multiplication of Employer Health Tax exemption for CCPCs.
    • Small Business Deduction limit: Parallel changes made to the federal small business deduction by the same amount the federal business limit is reduced

    Personal Income Tax Measures

    No changes to personal taxes were announced.

    Personal Combined Federal/Provincial Top Marginal Rates
    2017
    Interest and regular income 53.53%
    Capital gains 26.76%
    Eligible dividends 39.34%
    Non-eligible dividends 45.30%

     

    • Caregiver Tax Credit: This new non-refundable 5.05% credit is available in respect of relatives who are infirm dependents, including adult children of the claimant or of the claimant’s spouse or common‐law partner
    • Ontario Seniors’ Public Transit Credit: Ontario Seniors’ Public Transit Tax Credit for all Ontarians aged 65 or older.
    • Property and land tax measures: Adjust the rules on land transfer tax including preventing qualifying purchasers from claiming their spouse’s interest for the first‐time homebuyers refund if the spouse is not a Canadian citizen or permanent resident of Canada.

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