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Tax Comparison Investment Income 2016 - Dividends vs Interest

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Personal Tax -> Dividend tax credits ->
Tax Rates -> Tax comparisons -> Tax Comparisons Dividends vs Interest -> 2016

Tax Comparison of Canadian Dividends vs Interest in 2016

The tables on this page compare taxes payable by province/territory in 2016 for three different types of investment income:

bulletCanadian dividends eligible for the enhanced dividend tax credit,
bulletnon-eligible Canadian dividends, and 
bullet 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, except for May 29, 2017 revisions to New Brunswick (re dividend tax credit rates that were revised by Bill 32 in Jul 2016), BC (re MSP rates announced Sep 2016) and NS (corrected non-eligible dividend tax credit rate).  The total taxes payable include any alternative minimum tax, where applicable.

Taxes Payable on Dividends Eligible for the Enhanced Dividend Tax Credit

Note:  Eligible dividends gross-up % is 38%, as it has been since 2012.

Actual
Eligible
Dividends
Taxable
Income
Total Federal + Provincial Income Taxes Payable (Refundable) in 2016
AB BC MB NB NL

NS

NT NU ON PE QC

SK

YT

$30,000 $41,400 $0 $780 $376 $0 $769 $0 $(680) $(828) $450 $0 $847 $0 $0
50,000 69,000 0 900 1,780 0 3,204 1,810 (942) (1,200) 600 359 2,548 0 0
60,000 82,800 1,613 2,500 4,832 1,822 6,404 4,716 766 508 2,350 3,042 4,832 1,756 1,686
80,000 110,400 4,751 5,634 10,625 5,048 12,196 10,246 3,944 3,999 5,483 7,981 10,924 4,954 4,855
100,000 138,000 7,740 8,623 16,204 8,031 17,910 15,616 6,930 7,948 9,933 12,674 17,608 8,275 7,842

Taxes Payable on Non-Eligible Dividends

Note:  Non-eligible dividends gross-up % is 17% in 2016 and later years.

Actual
Non-eligible
Dividends
Taxable
Income
Total Federal + Provincial Income Taxes Payable in 2016
AB BC MB NB NL

NS

NT NU ON PE QC

SK

YT
$15,000 $17,550 $0 $(24) $691 $0 $0 $40 $(383) $(351) $0 $78 $139 $0 $0
30,000 35,100 577 1,074 2,593 1,113 928 1,510 (601) (702) 300 1,709 1,448 925 410
50,000 58,500 3,817 4,068 7,008 5,149 4,991 5,855 758 1,041 2,863 5,850 5,892 4,607 3,142
60,000 70,200 5,792 5,848 9,719 7,626 7,438 8,572 1,851 2,658 4,599 8,456 8,480 6,897 4,995
80,000 93,600 9,909 10,160 16,098 12,963 12,665 14,200 5,266 6,264 9,315 14,152 14,152 11,646 8,926
100,000 117,000 15,145 16,332 23,598 19,602 18,923 21,138 10,338 11,314 16,008 20,968 21,585 17,514 14,364

Taxes Payable on Other Income (foreign dividends, interest, etc.)

Interest
Income
Taxable
Income
Total Federal + Provincial Income Taxes Payable in 2016
AB BC MB NB NL

NS

NT NU ON PE QC

SK

YT

$15,000 $15,000 $529 $454 $1,040 $529 $529 $802 $233 $311 $571 $865 $447 $529 $755
30,000 30,000 3,934 4,151 5,032 4,518 4,517 4,696 3,181 2,861 4,088 4,935 5,379 4,336 3,965
50,000 50,000 9,193 9,272 10,822 10,423 10,203 10,945 7,618 6,725 9,005 10,874 12,001 9,903 8,626
60,000 60,000 12,243 12,092 14,147 13,955 13,703 14,504 10,428 9,275 11,970 14,304 15,811 13,253 11,576
80,000 80,000 18,343 17,833 21,402 21,019 20,805 21,938 16,188 14,775 18,176 21,629 23,434 19,953 17,476
100,000 100,000 24,962 24,771 29,501 28,925 28,385 29,949 23,175 21,067 25,953 29,617 32,100 27,173 24,075

Notes re all three tables:
     - BC includes MSP premiums payable for 2017 based on 2016 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 Comparison of Investment Income for Seniors

Tax Comparisons of Taxes Payable on Employment Income by Province and Territory

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

Revised: September 20, 2017

 

 

 

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