Fidelity's tax calculator allows you to estimate your year end tax balance based on your employment income, investment income, RRSP contributions, charitable donations, and the amount of taxes paid. The calculator will show your tax savings based on the specified RRSP contribution amount.
All federal and provincial taxes and surtaxes are taken into account, however the calculator assumes that only the basic personal tax credit, as well as the dividend tax credit and Canada employment amount (if applicable) are available. You may be entitled to other tax deductions and credits. It is assumed that the full amount of donations, subject to the 75% net income limitation, is used to calculate the donation tax credit, although that may not be the optimal tax reduction strategy in all circumstances.It is also assumed that taxable income for provincial purposes is the same as federal.
The calculator is intended to estimate your taxes only. Your personal tax situation may have additional complexities that cannot be factored in by this tax calculator. We recommend you consult your investment professional or tax advisor for a comprehensive review of your personal tax situation.
Interest - this amount is taxed at the same rate as your employment income.
Capital Gains - half of this amount is taxable which the calculator automatically accounts for.
Canadian Dividends - Canadian dividends receive preferential tax treatment as compared to interest income. There are two types of dividends: eligible and other than eligible. The calculator assumes the dividend to be an eligible dividend and it is therefore grossed up by 38% for the 2012 and later tax years. The corresponding non-refundable dividend tax credit, which can reduce your taxes owing, is also included in the calculation.
Charitable Donations - You can claim eligible amounts of gifts to a limit of 75% of your net income. For 2015 and prior years, a 15% Federal credit and 6% provincial credit will be calculated on the first $200 of donations, and a 29% Federal credit and 11% provincial credit on remaining donations. For donations made after the 2015 tax year, the calculation will incorporate the new tax credit rate of 33% that applies to the eligible amount of gifts greater than $200 to the extent that an individual has income that is subject to the new 33% income tax rate.
RRSP contribution - total up any RRSP contribution from the previous year, contribution amount contributed 60 days after the end of the taxation year, plus any unused contributions from prior years. Refer to your Notice of Assessment from the Canada Revenue Agency (CRA) to find out your current RRSP contribution limit and any unused contributions in the prior years.
Taxes paid - the amount of taxes withheld by your employer (at source) or tax installments you have already remitted to CRA for the taxation year.
Canada Revenue Agency's (CRA) web site
for more information.