Tax Season 2025 – What Every Canadian Needs to Know Before Filing
Tax season is officially here, and if you're a Canadian taxpayer, there are a few important things you need to know before filing your return. With some changes coming into effect this year, it’s crucial to stay informed and take advantage of all available benefits.
First things first—the Canada Revenue Agency (CRA) has opened up online tax filing, meaning you can now submit your returns. If you're like most Canadians, you probably want to maximize your refund and minimize any taxes owed. According to financial expert Clay Jarvis from NerdWallet Canada, this is the year to pay extra attention to tax credits. With financial stress impacting many households, ensuring you claim all eligible deductions and credits can make a significant difference.
So, when's the deadline? For most individuals, the deadline to file and pay any owed taxes is April 30, 2025. If you're self-employed, you have until June 16 to file, but any outstanding balance still needs to be paid by April 30 to avoid interest charges. Getting started early is always a good idea—it gives you more time to track down receipts, ask the CRA for help, and ensure your return is error-free. Plus, filing sooner means getting your refund faster!
Now, let’s talk tax brackets. The federal income tax brackets have been adjusted for inflation, increasing by 2.7% in 2025. The first $57,375 of income is taxed at 15%, while earnings between $57,375 and $114,750 fall into the 20.5% bracket. If your income is higher, different tax rates apply, with the top bracket for those earning over $253,414 taxed at 33%. And don’t forget—each province and territory has its own tax rates, so your final tax bill will depend on where you live.
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When it comes to savings, the CRA has made adjustments as well. The Registered Retirement Savings Plan (RRSP) contribution limit is now $32,490, up from $31,560 last year. The Canada Pension Plan (CPP) has also seen an increase in maximum contributions, with employees and employers each paying up to $4,034.10. Meanwhile, the Tax-Free Savings Account (TFSA) contribution room remains unchanged at $7,000 for 2025.
The CRA has also made some website updates to make tax filing more convenient. You can now use a single sign-in to access multiple CRA services, including My Account, My Business Account, and Represent a Client. Plus, there’s a new online chat feature to connect with CRA agents for assistance.
Another big development this year is automatic tax filing. The CRA is expanding its SimpleFile by Phone service, allowing more than two million Canadians with simple tax situations to file automatically. If you’re eligible, you’ll receive an invitation letter from the CRA in the coming months.
And what about capital gains tax? Well, there's good news for now—the federal government has delayed planned changes to capital gains taxation until January 1, 2026. This gives investors and high-income earners some breathing room before any new rules kick in.
For gig workers and self-employed Canadians, navigating tax season can be tricky. If you worked from home or earned freelance income, be sure to check what deductions you can claim, such as home office expenses and business-related costs. And if you need help, consider visiting a free tax clinic, especially if you have a lower income.
Finally, if you’re expecting a tax refund, don’t treat it as free money. Financial experts recommend using it wisely—pay off debt, invest, or add it to your savings. Remember, a tax refund is essentially money you overpaid to the government, so make sure it works for you.
With these key updates in mind, now is the time to get organized and file your taxes with confidence. Whether you’re aiming for a refund or just want to avoid penalties, staying informed will help make tax season 2025 as stress-free as possible.
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