Residents of Waterloo Region pay taxes to federal, provincial and municipal government. The government uses your taxes to pay for programs and services, including health care, education, roads and many others.

Whether you are considering immigrating to Canada or moving a business here, take some time to learn about Canada's tax system.

The Canada Revenue Agency (CRA) administers tax laws for the Government of Canada and most provinces and territories, and administers various social and economic benefit and incentive programs that are delivered through the tax system.

Harmonized Sales Tax

In Ontario, 13% Harmonized Sales Tax (HST) is added to the price you pay for most goods and services. It includes 5% Goods and Services Tax (federal) and 8% Provincial Sales Tax. You may pay less or no tax for some goods and services, such as food, children's clothing and energy. 

Personal income tax

As an employee, income tax will be deducted from your paycheque by the federal and provincial governments to pay for public services. You will also see deductions for:

  • Canada Pension Plan (CPP)
  • Employment Insurance (EI)
  • Union dues (if you belong to a union)
  • Company pension plans (if you are entitled to one)
  • Other things you and your employer have agreed to. 

Added up, these deductions may take as much as 35% off your pay. 

Each year you have to submit an Income Tax and Benefit Return to the CRA so the government knows how much money you made and the taxes that you paid. You may get money back if you paid too much in tax, or you may have to pay more if you did not pay enough in tax.

See the Government of Canada for more information about paying income tax.

Business taxes

How you report your business income, the taxes you pay and many other aspects of your business are determined by the type of business you operate. The main types of businesses in Canada are sole proprietor, partnership and corporation. Learn about the impact that your choice of structure might have on your business:

Tax on currency brought into Canada

You will not be taxed on the money you bring with you when you land in Canada.

After you arrive, your settlement worker can provide you with information and referrals to help you understand the tax system in Canada.