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Taxes

What are taxes?

Taxes are collected from individual Canadians and businesses by the government to help pay for roads, schools, health care and other important government programs and services. Taxes are collected in different ways. 

Sales Tax

Sales Tax is collected from individuals making purchases of goods or services.  The Harmonized Sales Tax (HST) in Ontario is 13%. The HST amount is not usually included on the price tag, so the final sale price at the cash register will include an additional 13%. Some purchases are exempt from HST, including food products, child-care services, and prescription drugs. A portion of the HST (8%) goes to the provincial government, and the remaining 5% goes to the federal government.

Income Tax

In Canada, a portion of each employee's income is considered taxable.  Most employees choose to have this amount deducted directly off their paycheque.  Others choose to calculate what they owe when they file their annual taxes and pay the difference at that time. The amount each person is required to pay varies based on their total annual earnings, minus any deductions and credits.  For more information about income tax, visit the Canada Revenue Agency (CRA) website.

Property Tax

Property tax is collected by the municipal (or local) government from property owners to support programs, services, and infrastructure like roads and public utilities in local communities. The amount of property tax a property owner needs to pay depends on the assessed value of the property and the local property tax rate, which is set by individual municipal governments. For more information about property tax, visit the Municipal Property Assessment Corporation (MPAC) website.

Businesses in Ontario

Businesses in Ontario are also required to pay taxes, depending on the type of business being operated.  For more information about filing taxes and other tax information for business in Ontario, visit the Service Ontario One-Source for Business website.

Here is a list of resources for more information about the tax system in Ontario