November 9, 2011
Rates, Thresholds and Amounts for 2012 Source Deductions and ContributionsBelow are the rates, thresholds and amounts applicable for 2012 source deductions and contributions.
Indexation for 2012Every year, the personal income tax system is automatically indexed. The indexation factor for 2012 is 2.66%.
Income thresholds and income tax bracketsFor 2012, the income tax rates applicable to the three income tax brackets remain at 16%, 20% and 24% and the thresholds for the three income tax brackets have been indexed as follows:
- The 16% rate applies to taxable income of $40,100 or less. (The threshold was previously $39,060.)
- The 20% rate applies to taxable income of more than $40,100 but not more than $80,200. (The threshold was previously $78,120.)
- The 24% rate applies to taxable income of more than $80,200.
Source deductions return (form TP-1015.3-V)The Source Deductions Return (form TP-1015.3-V) has been amended to take into account the new tax credit for workers 65 or older. In addition, the amounts on form TP-1015.3-V have been indexed.
Amount for workers 65 or olderA new tax credit for workers 65 or older will gradually be introduced beginning January 1, 2012. This new tax credit is designed to eliminate the income tax that such workers would normally have to pay on a portion of their eligible work income that is in excess of $5,000. The primary work income targeted by the measure is employment income.
If an employee 65 or older expects to earn more than $5,000 in eligible work income during the year, he or she may ask you to reduce applicable source deductions by completing form TP-1015.3-V.
If you use Table TP-1015.TI-VIf you use Table TP-1015.TI-V to calculate source deductions, you are not required to make any adjustments since the amount of this tax credit is included in the amounts used to establish the deduction codes in Table TP-1015.TI-V. As of 2012, these codes will take into account the tax credit for workers 65 or older.
If you use the formulasIf you calculate source deductions using the formulas in the guide Formulas to Calculate Source Deductions and Contributions (TP-1015.F-V), changes have been made to take the new tax credit into account. For more information on the changes, see Part 2 of the guide.
Indexation of the amounts in form TP-1015.3-V
|Amount transferred from one spouse to the other||$10,925||$10,640|
|Amount for other dependents who are 18 or over||$2,930||$2,855|
|Amount for a child under 18 enrolled in post-secondary studies||$2,015||$1,965|
|Additional amount for a person living alone (single-parent family)||$1,585||$1,545|
|Amount for a severe and prolonged impairment in mental or physical functions||$2,485||$2,420|
|Amount for a person living alone||$1,280||$1,245|
|Amount for retirement income||$2,090||$2,035|
|Reduction threshold used to calculate net family income (This income is used to calculate the age amount, the amount for a person living alone and the amount for retirement income.)||$31,695||$30,875|