GST/HST exemptions, end of short-term rental deductions and CPP hikes are among new 2024 measures to be made aware of. Here are some of the changes happening:
Eliminating short-term rental deductions
The federal government is now eliminating the tax break for short-term rentals like AirBnB by denying operators of short-term rentals any income tax deductions for expenses if they operate in provinces or municipalities that have banned short-term rentals.
The federal government announced it was taking the GST/HST off “professional services rendered by psychotherapists and counselling therapists.”
The federal government will also begin removing the GST from the construction of new rental apartments as it announced it was extending this initiative to new co-op rental housing.
CPP pension changes
This year, the federal government will start collecting a second level of CPP contributions.
Combined with the annual increase in CPP contributions, the added second level means an employee’s annual CPP payment will go up by $302 in 2024, increasing from a 2023 maximum of $3,754.45 to a 2024 maximum of $4,045.50.
Employers are required to match the contributions of their employees dollar-for-dollar, which means each employer will also see their per-employee CPP contributions jump by a maximum of $302.
Other notable tax changes for 2024
On April 1, 2024 the price on carbon goes up from $65 a tonne to $80 a tonne in provinces where the federal backstop applies.
On April 1, provinces and territories using the federal backstop will see gas charges rise to 17 cents a litre from the 2023 rate of 14 cents a litre, while the propane fuel charge will increase to 12 cents a litre from 10 cents.
Income taxes, EI premiums and TFSAs
Beginning Jan. 1, federal income tax bracket thresholds in Canada will rise 4.7 per cent across all brackets, compared to a 2023 rise of 6.3 per cent. Basic personal exemption amounts have also been adjusted to account for inflation.
The annual tax free savings account contribution also rises from $6,500 in 2023 to $7,000 in 2024.
The maximum insurable earnings ceiling for EI rises to $63,200 starting Jan. 1, up from $61,500 in 2023, which means that people only pay the $1.66 per $100 earned on the first $63,500 they earn.
For 2024, that means the maximum annual EI premium a person earning at least $63,500 will have to pay is $1,049.12, compared to a 2023 maximum of $1,002.45.
Bare Trust changes
When Canadians do their taxes in 2024, they’ll be required to report any involvement in “bare trusts.”
Please don’t hesitate to reach out to our office if we can be of any assistance on understanding any of these changes in more detail.