Glimpse of Tax Free Income in Canada
Every citizen of the country who earns money beyond a certain limit has to pay taxes. In fact, there is a saying in the country according to which, death and taxes are certain more than anything else here.
Sometimes, the taxes amount to be so high that we sit back and think if we are paying most of our earnings into taxes or not.
Some of the following kinds of incomes are considered to be tax free:
- Child Tax benefit payment is a tax free monthly payment made to support the eligible families in raising their children. This covers the entire cost of bringing up children who are below 18 years of age. The programs under this category are
National Child Benefit: this is a joint inactive of Federal, Provincial and Territorial Government. The program aims to ensure that children of the country are brought in a healthy manner.
Child Disability Benefit: This program is to support the families who are rising up a child who is qualified to receive disability grants and he is below 18 years of age. A child is termed as disable when he has severe physical or mental impairments.
- Tax Free Savings Account: when you put money into any such account, you will not get any deduction right away, but, you will certainly not be charged any tax when you withdraw your money.
- Registered Retirement Savings Plan: Under this plan you get a deduction for the amount you contribute to such an account. But, you must remember, that the earnings are not taxable as long as you don’t withdraw the money.
- Gifts and Inheritances: When you receive a gift or inheritance from any of your relatives, you must think of not spending it right away. If you be wise enough to put it in a high interest paying account and wait for the right time to withdraw or use the same, you will not be liable for paying any taxes.
- Insurances: You may get a tax deduction on the premiums you pay on Life Insurances or even permanent insurances.
To save the major chunk of your money, you will have to explore the options around you and find out the ways of saving upon some amount here and some amount there.