Does inflation affect your clients’ taxes?

Personal income tax and benefit amounts are indexed to inflation using Statistic Canada’s Consumer Price Index data every year, says the CRA.

Read: Inflation stays at 1.2%

Increases to items like tax bracket thresholds and amounts relating to non‑refundable credits will take effect on January 1, 2013.

Increases to the Canada child tax benefit and the goods and services tax credit will take effect on July 1, 2013, however, to coincide with the beginning of the program year.

Read: Canadians will get raises in 2013

Your clients should be aware of all changes, so make sure they understand how their taxes will be affected in the coming year.

See the CRA’s chart, which compares the indexed amounts for the 2012 and 2013 tax years.

Read:

Why paying taxes is easy in Canada

6 ways to trim a tax bill

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Canadians will be more frugal in 2013

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