Tax in Canada - Deadlines, Credits and How to File

This outlines answers answers to the top questions about taxes in Canada. Learn about the Canada tax deadline, how to file taxes, BC Sales Tax Credit, BC Renters Tax credit, City of Vancouver Property tax and more.

Canada Tax Deadline

• The tax filing deadline 2024 Canada is April 30, 2025.
• The self-employed tax deadline is June 15, 2025.

Late filing could result in penalties and interest charges if you miss the Canada tax deadline, so it’s best to submit on time.

When Does the Tax Year Start and End in Canada?

The tax year in Canada runs from January 1 to December 31 each year. This means that any income earned within this period must be reported when you file your taxes the following year.

How to File Taxes in Canada

Most people file their taxes online, Wealthsimple Tax is the highest recommended tool.

• Use an online tax tool like Wealthsimple - Recommended again and again.
• Use Netfile – If you're filing your own return, Netfile-certified tax software lets you submit your return directly to the Canada Revenue Agency (CRA).
• Hire an accountant – If you have investments, multiple income sources, or self-employment income, an accountant can help optimize your return. I am looking for one, so if you have one, please hit me up at jaycee@movingtovancouver.ca!
• File on paper – You can mail your tax return, but it takes much longer to process, I recommend doing it online.

File your taxes and get your details here: CRA My Account

Do Newcomers to Canada Need to File Taxes?

Yes. Even if you didn’t earn income in Canada, filing a return can help you qualify for government benefits and credits.

Who needs to file:

• New permanent residents
• International students
• Temporary foreign workers
• Refugees

Reasons to file:

Even if you made no money, you may qualify for:

• GST/HST credit (a tax-free payment to help with living costs)
• Canada Child Benefit (CCB) if you have children
• Provincial tax credits like the BC Renters Tax Credit

How to File Taxes as a Newcomer

You will need:

• Social Insurance Number (SIN) – If you don’t have one yet, you can file with an Individual Tax Number (ITN).
• Your immigration date – You will need to report when you became a Canadian resident.
• Any foreign income earned before moving to Canada – This may need to be reported, but you will not pay tax on it.
• Bank account details – For direct deposit of refunds and benefits.
• Key tax documents – T4 slips (employment income), T5 slips (interest income), rent receipts (if applicable).

Ways to file:

• Use online tax software like Wealthsimple Tax (free)
• Hire an accountant for complex situations
• Paper file using Form RC151 for newcomers. You might have to file by paper first.

If you moved to Canada partway through the year, you only pay tax on income earned after arriving.

Tax Benefits for Newcomers

Even if you do not owe taxes, you may qualify for government credits and benefits.

GST/HST Credit (Tax-Free Payments)

• Quarterly payments from the government
• Up to $496 per year if you qualify
• You must file taxes to receive this

BC Renters Tax Credit

There is more on this in the detailed sections below

• Up to $400 for renters in BC
• Available if you earn $63,000 or less

Canada Child Benefit (CCB)

• Tax-free payments for parents
• $7,787 per year ($648.91 per month) for each eligible child under the age of 6
• $6,570 per year ($547.50 per month) for each eligible child aged 6 to 17

Medical Expense Tax Credit

• If you paid for private health insurance, you may get a refund
• Eligible expenses include dental care, prescription glasses, and fertility treatments
• You can claim medical expenses if they exceed 3% of net income or $2,759 (whichever is lower).

Public Transit Tax Credit (Only in BC and Ontario)

• Some transit passes qualify for a tax break

First-Time Home Buyers Credit

• Up to $1,500 back if you buy your first home in Canada

Are Moving Expenses Tax Deductible?

If you moved to Canada for work, to run a business, or to attend full-time post-secondary school, you may be able to deduct moving expenses on your tax return.

Who qualifies?

You must meet both of these conditions:

1. You moved at least 40 km closer to your new work, business, or school.
2. Your new home is your primary residence.

What moving expenses can you deduct?

• Travel costs – Plane tickets, train or bus fares, mileage, meals, and lodging.
• Moving & storage costs – Hiring movers, truck rental, packing, and storage for up to 30 days.
• Lease cancellation fees – If you had to break your lease.
• Utility connection/disconnection fees – Costs for setting up utilities at your new home.
• Real estate & legal fees – If you sold your home before moving.
• Costs to maintain an empty home – Up to $5,000 in property taxes, mortgage interest, and utilities while waiting for it to sell.

How to claim moving expenses

• Use Form T1-M (Moving Expenses Deduction) to calculate your claim.
• Report the total on Line 21900 of your tax return.
• Keep all receipts and documentation in case CRA requests proof.

If your moving expenses exceed your income in the new location, you can carry forward unused expenses to future tax years.

For full details, visit: CRA Moving Expenses Guide

Do Newcomers Pay Taxes on Foreign Income?

It depends.

• You do not pay Canadian tax on income earned before moving to Canada.
• You may have to pay tax on foreign income earned after becoming a Canadian resident.

If you still earn money from your home country (rental income, freelance work, etc.), you might need to report it. Canada has tax treaties with many countries to prevent double taxation.

If you have a bank account abroad, CRA may ask you to report it on Form T1135 (if it holds more than $100,000 CAD).

Capital Gains Tax Canada

If you sell an asset, like stocks or real estate, for more than you paid, the profit is considered a capital gain, and you’ll pay tax on a portion of it.

Capital Gains Tax Rates

• 50% of your capital gain is taxable.
• Your tax rate depends on your marginal tax bracket.
• If you're in a 20% tax bracket, you pay 10% on your capital gains.
• If you're in a 33% tax bracket, you pay 16.5% on your capital gains.
• The maximum capital gains tax rate in BC is 26.75%.

Source: Canada Revenue Agency Capital Gains – 2024

Realized vs. Unrealized Gains

• Realized capital gain occurs when you sell an investment for a profit.
• Unrealized capital gain happens when your investment increases in value, but you haven’t sold it yet. You’re only taxed when you sell.

What are Capital Losses

• A capital loss happens when you sell an asset for less than you paid.
• You can use capital losses to offset capital gains in the current year, the past three years, or carry them forward indefinitely.

How to Reduce Capital Gains Tax

• Primary Residence Exemption: No tax on capital gains when selling your main home.
• Offset Gains with Losses: Use capital losses to lower taxable gains.
• Tax-Sheltered Accounts: Investments in RRSPs or TFSAs are exempt from capital gains tax while inside these accounts.
• Donate Investments: Donating appreciated stocks to charity avoids capital gains tax and provides a tax credit.

Capital Gains Tax Example

Here’s how much tax you’d owe on capital gains based on different incomes and locations:

BC Sales Tax Credit

The BC Sales Tax Credit is a rebate that helps lower-income residents in BC offset the cost of provincial sales tax. If you qualify, it will be applied automatically when you file your income tax return. You can still receive this credit even if you have no taxable income.

How much is the BC Sales Tax Credit?

The maximum amount you can receive is:

• $75 for an individual
• $75 for a spouse or common-law partner

Your credit is reduced by 2% of any net income above $15,000 for individuals or $18,000 for families. Once your income reaches $18,750 (individual) or $25,500 (household), you no longer qualify.

Eligibility:

• Individuals earning under $18,750 may qualify.
• Partners or families earning under $25,500 may qualify.

Example Calculation:

Casey and Taylor have a combined household income of $24,000. They qualify for the BC Sales Tax Credit, but their credit amount is reduced due to their income level.

• Maximum Credit: $75 per person = $150 total
• Income Above Threshold: $24,000 - $18,000 = $6,000
• 2% Reduction: $6,000 × 2% = $120
• Final Credit: $150 - $120 = $30 total credit

If the calculated credit is negative, it means no credit is available.

Who qualifies for the BC Sales Tax Credit?

You may be eligible if you:

• Are 19 years or older
• Have a spouse or common-law partner
• Are a parent
• Have not been in prison for more than 6 months in the tax year

How to claim the BC Sales Tax Credit

The credit is automatically calculated when you file your tax return. Most tax software, like TurboTax and Wealthsimple Tax, will apply it for you. To manually check eligibility, use Form 5010-TC BC479 to calculate your credit amount before submitting your return.

BC Renters Tax Credit

If you're renting in BC, you may be eligible for the BC Renters Tax Credit to help offset housing costs.

How much is the BC Renters Tax Credit?

• Up to $400 for individuals and families earning $63,000 or less
• A reduced amount is available for incomes between $63,000 and $83,000
• The credit is phased out at $83,000

Your income does not affect the amount of rent you can claim—the credit is based on your adjusted income, not rent paid.

Source: B.C. renter's tax credit

Who qualifies for the BC Renters Tax Credit?

To be eligible, you must:

• Have lived in a rental unit in BC for at least 6 months in the year
• Be a BC resident on December 31 of the tax year
• Be 19 years or older, a parent, or cohabiting with a spouse or common-law partner

How to claim the BC Renters Tax Credit

You can claim the credit on Form BC479 when filing your T1 Income Tax and Benefit Return. You’ll need:

• Total rent paid during the year
• Number of months rented
• Rental address
• Landlord’s name

The Canada Revenue Agency (CRA) may request proof of rent, so it’s a good idea to keep rent receipts.

Claim your renters tax credit when you file your taxes here: CRA My Account

City of Vancouver Property Tax

If you own property in Vancouver, you must pay annual property taxes to the City of Vancouver. Payments are usually due in early July each year.

Property Tax Due Dates

• Advance taxes: February 4, 2025
• Main taxes: July 3, 2025
• Home Owner Grant: July 3, 2025 (can be claimed once the main tax notice is received)

Residential Property Tax Rates

You pay the following dollar amounts in tax for every $1,000 of your property's taxable value.

Pay your property taxes here: City of Vancouver Property Tax Portal

What is Line 15000 on a Tax Return?

Line 15000 (previously Line 150) is your total income before deductions. It includes employment income, rental income, capital gains, and other sources before credits are applied.

First Home Savings Account (FHSA)

The secret is, you don’t need to be planning on buying a house to get the tax deductions of saving in an FHSA.

What is an FHSA?

The First Home Savings Account (FHSA) lets you contribute up to $8,000 per year (up to a lifetime limit of $40,000) towards a down payment. Your contributions are tax-deductible, and any investment growth or withdrawals used for a first home purchase are tax-free.

Who qualifies for an FHSA?

• You must be a resident of Canada
• Be at least 18 years old
• Be a first-time homebuyer, meaning you haven’t owned a home (or lived in a partner’s home) in the past 4 years

Why open one?

• Contributions lower your taxable income, like an RRSP
• Withdrawals are completely tax-free when used to buy your first home
• If you don’t end up buying a home, you can transfer the balance into your RRSP without affecting your RRSP contribution room

How to open an FHSA

Most major banks and investment platforms offer FHSAs. Wealthsimple, Questrade, and big banks like RBC and TD all have options. Make sure to designate the account as an FHSA when opening.

💡 Tip: If you're eligible, open one even if you’re not sure when you’ll buy—just to start building contribution room.

Registered Retirement Savings Plan (RRSP)

The RRSP is one of the most powerful ways to save on taxes while building wealth for retirement—or even buying your first home or going back to school. Ask your employer if they have RRSP matching or an RRSP plan, to maximize the benefit even more.

What is an RRSP?

An RRSP is a tax-deferred retirement account. Contributions are tax-deductible, and any investment growth is tax-free until withdrawal. You pay tax later when you withdraw funds—ideally when your income is lower.

RRSP Contribution Limit

You can contribute up to 18% of your earned income from the previous year, up to an annual maximum. For the 2024 tax year, the max is $31,560. Unused contribution room carries forward indefinitely.

RRSP Benefits:

• Reduces your taxable income now
• Lets you grow investments tax-free until retirement
• Can be used for two key programs:
• Home Buyers’ Plan (HBP): Withdraw up to $35,000 to buy your first home (must be repaid over 15 years)
• Lifelong Learning Plan (LLP): Withdraw up to $10,000 per year for education (must be repaid over 10 years)

Sources

I got all this information from scouring the internet and mainly from:

Canada Revenue Agency Canada Revenue Agency (CRA)

Also, tips from my financial advisor

Next steps

For all details around Canada Pension Plan, Old Age Security and Employment Insurance you can sign up for a My Services Canada account:

You’ll need a job to start saving! Find a job: