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Tax Comparison Investment Income 2015 - Dividends vs Interest

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Personal Tax -> Dividend tax credits ->
Tax Rates -> Tax comparisons -> Tax Comparisons Investment Income

Tax Comparison of Canadian Dividends vs Interest in 2015

The tables on this page compare taxes payable by province/territory in 2015 for three different types of investment income - Canadian dividends eligible for the enhanced dividend tax credit, non-eligible Canadian dividends, and other investment income such as foreign dividends and interest.  The calculations assume that the income is earned by a single person, and that there is no other type of income included in taxable income.  The tax rates used are as known on June 13, 2016.  The total taxes payable include any alternative minimum tax, where applicable.

Dividends Eligible for the Enhanced Dividend Tax Credit

Actual
Eligible
Dividends
Taxable
Income
Total Federal + Provincial Income Taxes Payable (Refundable) in 2015
AB BC MB NB NL

NS

NT NU ON PE QC

SK

YT

$30,000 $41,400 $0 $900 $376 $0 $584 $0 $(680) $(828) $450 $0 $905 $0 $0
50,000 69,000 0 900 1,780 0 2,544 1,810 (942) (1,200) 600 388 2,606 0 0
60,000 82,800 1,423 2,319 4,552 1,500 5,106 4,391 516 258 2,169 2,745 4,910 1,476 1,450
80,000 110,400 4,505 5,397 10,264 5,277 10,407 9,827 3,621 3,721 5,247 7,591 11,058 4,593 4,550
100,000 138,000 7,494 8,387 15,843 9,613 15,636 15,197 6,608 7,671 9,686 12,284 17,800 7,981 7,537

Note that in 2015 Albertans will actually pay a small amount of provincial tax on eligible dividends (compared to zero previously), due to the tax rate increases which took effect October 1, 2015.  The amount will be more in 2016 when the higher tax rates are in effect for the full year.  The highest marginal tax rate for eligible dividends for AB is 21.02%, but will be 26.19% in 2016.

Non-Eligible Dividends

Note:  Non-eligible dividends gross-up % is 18% in 2015.  It will be 17% in 2016 and later years.

Actual
Non-eligible
Dividends
Taxable
Income
Total Federal + Provincial Income Taxes Payable in 2015
AB BC MB NB NL

NS

NT NU ON PE QC

SK

YT
$15,000 $17,700 $0 $(21) $709 $0 $0 $26 $(383) $(354) $0 $148 $160 $0 $0
30,000 35,400 621 1,272 2,629 1,034 619 1,485 (605) (708) 300 1,717 1,558 970 418
50,000 59,000 3,901 4,064 7,094 5,048 4,253 5,839 780 1,012 2,820 5,871 6,037 4,715 3,204
60,000 70,800 6,012 5,963 9,973 7,621 6,546 8,686 2,006 2,755 4,665 8,616 8,747 7,144 5,188
80,000 94,400 10,432 10,617 16,675 13,212 11,509 14,597 5,822 6,661 9,796 14,594 14,756 12,201 9,451
100,000 118,000 15,596 16,741 24,122 19,703 17,217 21,437 10,821 11,602 16,379 21,316 22,188 18,003 14,812

Other Income (foreign dividends, interest, etc.)

Interest
Income
Taxable
Income
Total Federal + Provincial Income Taxes Payable in 2015
AB BC MB NB NL

NS

NT NU ON PE QC

SK

YT

$15,000 $15,000 $551 $476 $1,062 $551 $551 $824 $266 $340 $614 $966 $467 $551 $786
30,000 30,000 3,980 4,383 5,054 4,566 4,436 4,718 3,214 2,890 4,118 4,986 5,461 4,381 3,996
50,000 50,000 9,350 9,419 10,956 10,594 10,067 11,079 7,777 6,882 9,171 11,037 12,170 10,071 8,785
60,000 60,000 12,550 12,389 14,431 14,276 13,517 14,788 10,737 9,582 12,286 14,617 16,107 13,571 11,885
80,000 80,000 18,950 18,448 21,985 21,641 20,497 22,522 16,797 15,382 18,812 22,242 23,981 20,571 18,085
100,000 100,000 25,774 25,606 30,289 29,769 27,981 30,737 24,025 21,901 26,875 30,436 32,855 27,995 24,910

Notes re all three tables:
     - BC includes MSP premiums payable for 2016 based on 2015 income.
     - Ontario - includes Ontario Health Premium.
     - QC includes progressive health contribution, contribution to the health services fund, and prescription drug insurance plan premiums.
     - QC taxes are net of tax credit for person living alone.

To see the tax results for your own income situation, and how it would change if the type of investment income changes, use our Income Tax Planning Calculators, in particular the Investment Income Tax Calculator.  However, the Investment Income Tax Calculator does not include BC MSP in the total taxes, because MSP is not actually part of the income tax system.  In the detailed Canadian Income Tax and RRSP Savings Calculator, the BC MSP is shown at the bottom of the calculator, but not included in the total taxes payable.

See also:

Tax Comparisons 

Tax Comparisons by Province and Territory, which compare different levels of employment income.

Tax Tip:  Interest and foreign dividends are not as tax-efficient as Canadian dividends!

 

Revised: September 20, 2017

 

 

 

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