Lowest tax rate to be reduced from 6.05% (2009) to
5.05% for 2010
Surtaxes are calculated on basic Ontario Tax
greater than certain thresholds. The thresholds are to be
reduced for 2010:
20% threshold reduced from $4,257 to $3,978 ($4,006
in Bill 218)
36% threshold reduced from $5,370 to $5,091($5,127
in Bill 218)
Sales and property tax credit
The current combined sales and property tax credit
would be replaced with 2 new credits:
Ontario Sales Tax Credit:
tax relief of up to $260 for each adult and
child in low-and middle-income families
reduced by 4% of adjusted family net income
over $20,000 for single people, and over $25,000 for families
refundable and paid quarterly, starting
July 2010
Ontario Property Tax Credit
based on occupancy cost - property tax
paid, or 20% of rent paid
credit of up to $250 for non-seniors or
$625 for seniors, plus 10% of occupancy cost
credit would not exceed occupancy cost, and
would be subject to a maximum of $900 for non-seniors and
$1,025 for seniors
adjusted by 2% of adjusted family net
income over $20,000 for single people and over $25,000 for
families
refundable, and claimed on the personal
income tax return, beginning with the 2010 return.
Dividend tax credit
As a result of the reductions in corporate income tax
rates (see below), Ontario would adjust the dividend tax credit rates for
2010 and later years, as
per the following table, which shows the dividend tax credit as a
percentage of the taxable dividend:
providing a 2-year waiver of fees for
financial-hardship unlocking applications
increasing the amount of unlocking permitted from
Ontario Life Income Funds (LIFs) from 25% to 50%, on purchase from new
LIFs, effective January 1, 2010
Current new LIF owners would have an opportunity to
unlock an additional 25% of amounts previously transferred in to their
existing fund.
Remaining old LIFs and Locked-in Retirement Income
Funds (LRIFs) would be harmonized with the updated new LIF rules.
Tax-Free Savings Accounts (TFSAs)
The government proposes to change the Succession Law
Reform Act (SLRA) to allow for beneficiary designation of TFSAs.
This would allow TFSAs to be passed to designated beneficiaries outside of
a will, without being subject to Estate Administration Tax.
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