Archive for the ‘Taxation’ Category

Marginal Tax Rates: Alberta 2012

Sunday, July 29th, 2012

E&Y have analyzed Alberta tax rates as of 2012-1-15 and we may draw some conclusions from these data:

Investors Taxable Income Marginal Rate on Interest Marginal Rate on Dividends Equivalency Factor
Widows & Orphans $30,000 25.00% 0.00% 1.33
Professionals $75,000 32.00% 9.63% 1.33
Plutocrats $150,000 39.00% 19.29% 1.32

Equivalency factors for Professionals and Plutocrats have declined marginally since my 2011 post on this topic.

Two nuances should be noted. Firstly, E&Y appears to have put a floor of 0.00% on the published marginal tax rate for dividends; in fact, the tax on dividends can be negative if the taxpayer has other income available to soak up the excess dividend tax credit. This will increase the equivalency factor for “Widows & Orphans”.

Secondly, if the taxpayer is subject to OAS clawback, the equivalency factor will decline by about 0.1. It should be noted that this figure is an extremely rough estimate and is based solely on the direct income tax effect – there may be other net-income-tested benefits to the taxpayer, such as drug plans, which will exacerbate the decline.

Marginal Tax Rates: BC 2012

Sunday, July 29th, 2012

E&Y have analyzed British Columbia tax rates as of 2012-1-15 and we may draw some conclusions from these data:

Investors Taxable Income Marginal Rate on Interest Marginal Rate on Dividends Equivalency Factor
Widows & Orphans $30,000 23.26% 0.00% 1.30
Professionals $75,000 32.50% 10.32% 1.33
Plutocrats $150,000 43.70% 25.78% 1.32

Equivalency factors have increased for Widows & Orphans and declined for Professionals and Plutocrats since my 2011 post on this topic.

Two nuances should be noted. Firstly, E&Y appears to have put a floor of 0.00% on the published marginal tax rate for dividends; in fact, the tax on dividends can be negative if the taxpayer has other income available to soak up the excess dividend tax credit. This will increase the equivalency factor for “Widows & Orphans”.

Secondly, if the taxpayer is subject to OAS clawback, the equivalency factor will decline by about 0.1. It should be noted that this figure is an extremely rough estimate and is based solely on the direct income tax effect – there may be other net-income-tested benefits to the taxpayer, such as drug plans, which will exacerbate the decline.

Marginal Tax Rates: Ontario 2012

Sunday, July 29th, 2012

E&Y have analyzed Ontario tax rates as of 2012-1-15 and we may draw some conclusions from these data:

Investors Taxable Income Marginal Rate on Interest Marginal Rate on Dividends Equivalency Factor
Widows & Orphans $30,000 20.05% 0.00% 1.25
Professionals $75,000 32.98% 14.19% 1.28
Plutocrats $150,000 46.41% 29.54% 1.31

The equivalency factor for plutocrats declined slightly since my 2011 post on this topic

Two nuances should be noted. Firstly, E&Y appears to have put a floor of 0.00% on the published marginal tax rate for dividends; in fact, the tax on dividends can be negative if the taxpayer has other income available to soak up the excess dividend tax credit. This will increase the equivalency factor for “Widows & Orphans”.

Secondly, if the taxpayer is subject to OAS clawback, the equivalency factor will decline by about 0.1. It should be noted that this figure is an extremely rough estimate and is based solely on the direct income tax effect – there may be other net-income-tested benefits to the taxpayer, such as drug plans, which will exacerbate the decline.

Marginal Tax Rates: Alberta 2011

Wednesday, March 2nd, 2011

E&Y have analyzed Alberta tax rates as of 2011-1-15 and we may draw some conclusions from these data:

Investors Taxable Income Marginal Rate on Interest Marginal Rate on Dividends Equivalency Factor
Widows & Orphans $30,000 25.00% 0.00% 1.33
Professionals $75,000 32.00% 7.85% 1.36
Plutocrats $150,000 39.00% 17.72% 1.35

Equivalency factors have declined marginally since my 2010 post on this topic.

Two nuances should be noted. Firstly, E&Y appears to have put a floor of 0.00% on the published marginal tax rate for dividends; in fact, the tax on dividends can be negative if the taxpayer has other income available to soak up the excess dividend tax credit. This will increase the equivalency factor for “Widows & Orphans”.

Secondly, if the taxpayer is subject to OAS clawback, the equivalency factor will decline by about 0.1. It should be noted that this figure is an extremely rough estimate and is based solely on the direct income tax effect – there may be other net-income-tested benefits to the taxpayer, such as drug plans, which will exacerbate the decline.

Marginal Tax Rates: BC 2011

Wednesday, March 2nd, 2011

E&Y have analyzed British Columbia tax rates as of 2011-1-15 and we may draw some conclusions from these data:

Investors Taxable Income Marginal Rate on Interest Marginal Rate on Dividends Equivalency Factor
Widows & Orphans $30,000 20.06% 0.00% 1.25
Professionals $75,000 32.50% 8.11% 1.36
Plutocrats $150,000 43.70% 23.91% 1.35

Equivalency factors have declined marginally since my 2010 post on this topic.

Two nuances should be noted. Firstly, E&Y appears to have put a floor of 0.00% on the published marginal tax rate for dividends; in fact, the tax on dividends can be negative if the taxpayer has other income available to soak up the excess dividend tax credit. This will increase the equivalency factor for “Widows & Orphans”.

Secondly, if the taxpayer is subject to OAS clawback, the equivalency factor will decline by about 0.1. It should be noted that this figure is an extremely rough estimate and is based solely on the direct income tax effect – there may be other net-income-tested benefits to the taxpayer, such as drug plans, which will exacerbate the decline.

Marginal Tax Rates: Ontario 2011

Wednesday, March 2nd, 2011

E&Y have analyzed Ontario tax rates as of 2011-1-15 and we may draw some conclusions from these data:

Investors Taxable Income Marginal Rate on Interest Marginal Rate on Dividends Equivalency Factor
Widows & Orphans $30,000 20.05% 0.00% 1.25
Professionals $75,000 32.98% 11.72% 1.32
Plutocrats $150,000 46.41% 28.19% 1.34

Equivalency factors have declined slightly since my 2010 post on this topic

Two nuances should be noted. Firstly, E&Y appears to have put a floor of 0.00% on the published marginal tax rate for dividends; in fact, the tax on dividends can be negative if the taxpayer has other income available to soak up the excess dividend tax credit. This will increase the equivalency factor for “Widows & Orphans”.

Secondly, if the taxpayer is subject to OAS clawback, the equivalency factor will decline by about 0.1. It should be noted that this figure is an extremely rough estimate and is based solely on the direct income tax effect – there may be other net-income-tested benefits to the taxpayer, such as drug plans, which will exacerbate the decline.

Marginal Tax Rates: Ontario 2010

Wednesday, May 19th, 2010

E&Y have analyzed Ontario tax rates as of 2010-3-31 and we may draw some conclusions from these data:

Investors Taxable Income Marginal Rate on Interest Marginal Rate on Dividends Equivalency Factor
Widows & Orphans $30,000 20.05% 0.00% 1.25
Professionals $75,000 35.39% 14.03% 1.33
Plutocrats $150,000 46.41% 26.57% 1.37

Equivalency factors have declined since my 2008 post on this topic; marginally for Plutocrats, Widows & Orphans, but more significantly for Professionals. The latter drop is from 1.42x to the current 1.33x.

Two nuances should be noted. Firstly, E&Y appears to have put a floor of 0.00% on the published marginal tax rate for dividends; in fact, the tax on dividends can be negative if the taxpayer has other income available to soak up the excess dividend tax credit. This will increase the equivalency factor for “Widows & Orphans”.

Secondly, if the taxpayer is subject to OAS clawback, the equivalency factor will decline by about 0.1. It should be noted that this figure is an extremely rough estimate and is based solely on the direct income tax effect – there may be other net-income-tested benefits to the taxpayer, such as drug plans, which will exacerbate the decline.

Marginal Tax Rates: BC 2010

Wednesday, May 19th, 2010

E&Y have analyzed British Columbia tax rates as of 2010-3-31 and we may draw some conclusions from these data:

Investors Taxable Income Marginal Rate on Interest Marginal Rate on Dividends Equivalency Factor
Widows & Orphans $30,000 20.06% 0.00% 1.25
Professionals $75,000 32.50% 5.80% 1.40
Plutocrats $150,000 43.70% 21.45% 1.40

Equivalency factors have declined marginally since my 2008 post on this topic.

Two nuances should be noted. Firstly, E&Y appears to have put a floor of 0.00% on the published marginal tax rate for dividends; in fact, the tax on dividends can be negative if the taxpayer has other income available to soak up the excess dividend tax credit. This will increase the equivalency factor for “Widows & Orphans”.

Secondly, if the taxpayer is subject to OAS clawback, the equivalency factor will decline by about 0.1. It should be noted that this figure is an extremely rough estimate and is based solely on the direct income tax effect – there may be other net-income-tested benefits to the taxpayer, such as drug plans, which will exacerbate the decline.

Marginal Tax Rates: Manitoba 2010

Wednesday, May 19th, 2010

E&Y have analyzed Manitoba tax rates as of 2010-3-31 and we may draw some conclusions from these data:

Investors Taxable Income Marginal Rate on Interest Marginal Rate on Dividends Equivalency Factor
Widows & Orphans $30,000 25.80% 0.00% 1.35
Professionals $75,000 39.40% 15.02% 1.40
Plutocrats $150,000 46.40% 25.10% 1.40

Equivalency factors have declined marginally since my 2006 post on this topic.

Two nuances should be noted. Firstly, E&Y appears to have put a floor of 0.00% on the published marginal tax rate for dividends; in fact, the tax on dividends can be negative if the taxpayer has other income available to soak up the excess dividend tax credit. This will increase the equivalency factor for “Widows & Orphans”.

Secondly, if the taxpayer is subject to OAS clawback, the equivalency factor will decline by about 0.1. It should be noted that this figure is an extremely rough estimate and is based solely on the direct income tax effect – there may be other net-income-tested benefits to the taxpayer, such as drug plans, which will exacerbate the decline.

Marginal Tax Rates: Alberta 2010

Wednesday, May 19th, 2010

E&Y have analyzed Alberta tax rates as of 2010-3-31 and we may draw some conclusions from these data:

Investors Taxable Income Marginal Rate on Interest Marginal Rate on Dividends Equivalency Factor
Widows & Orphans $30,000 25.00% 0.00% 1.33
Professionals $75,000 32.00% 5.80% 1.39
Plutocrats $150,000 39.00% 15.88% 1.38

Equivalency factors have declined marginally since my 2006 post on this topic.

Two nuances should be noted. Firstly, E&Y appears to have put a floor of 0.00% on the published marginal tax rate for dividends; in fact, the tax on dividends can be negative if the taxpayer has other income available to soak up the excess dividend tax credit. This will increase the equivalency factor for “Widows & Orphans”.

Secondly, if the taxpayer is subject to OAS clawback, the equivalency factor will decline by about 0.1. It should be noted that this figure is an extremely rough estimate and is based solely on the direct income tax effect – there may be other net-income-tested benefits to the taxpayer, such as drug plans, which will exacerbate the decline.