Tax laws change every year, and staying informed helps you maximize your returns and avoid surprises. Here’s a breakdown of the most significant tax changes for 2024, ranked from most relevant to Canadians to less commonly used changes.
1. Canada Pension Plan (CPP) and Quebec Pension Plan (QPP) Enhancements
Who is affected? All employees, employers, and self-employed individuals.
A new second additional contribution of 4% applies to earnings above the Year’s Maximum Pensionable Earnings (YMPE) up to the Additional Maximum Pensionable Earnings (AMPE).
Self-employed individuals will pay an additional 8% on applicable earnings.
Workers 65+ can now opt out of QPP contributions if they already receive a pension.
Mandatory contributions end at age 73.
2. Home Buyers' Plan (HBP) Limit Increase
Who is affected? First-time home buyers.
The HBP withdrawal limit increases from $35,000 to $60,000 for withdrawals made after April 16, 2024.
A three-year repayment deferral is available for first-time withdrawals made between January 1, 2022, and December 31, 2025.
3. Capital Gains Tax Changes (Effective June 25, 2024)
Who is affected? Investors, business owners, and individuals selling property or investments.
The taxable portion of capital gains increases from 50% to 66.67% for:
Individuals with annual capital gains exceeding $250,000 (first $250,000 remains taxed at 50%).
All corporate and trust capital gains, regardless of amount.
Lifetime Capital Gains Exemption (LCGE) increases to $1.25 million for small business shares, farming, and fishing properties.
New Canadian Entrepreneurs’ Incentive offers a reduced 33.33% inclusion rate on up to $2 million in eligible capital gains.
4. Canada Carbon Rebate (CCR) Expansion
Who is affected? Residents of AB, MB, NB, NS, NL, ON, and SK in rural areas.
Expanded eligibility for rural supplement to include individuals living in census rural areas or small towns.
Payments based on 2021 Census geographic data begin in April 2025.
5. Alternative Minimum Tax (AMT) Changes
Who is affected? High-income earners using large deductions or tax credits.
The AMT rate increases and exemptions are adjusted.
New limitations on certain non-refundable tax credits.
6. Digital Platform Reporting Requirements
Who is affected? Gig workers and online sellers.
Platforms like Uber, Airbnb, and Etsy must report seller income to the CRA.
Sellers will receive an annual statement from platform operators for tax filing purposes.
7. Short-Term Rental Expense Deduction Restrictions
Who is affected? Property owners renting non-compliant short-term accommodations.
No longer allowed to deduct expenses for short-term rentals that don’t comply with local regulations.
8. Volunteer Tax Credits
Who is affected? Eligible volunteer firefighters and search & rescue volunteers.
The tax credit doubles from $3,000 to $6,000 for those with 200+ hours of eligible service.
Key Takeaways
CPP and QPP contributions increase for high earners.
Capital gains tax rates increase, especially for large gains.
HBP withdrawal limits rise, making homeownership more accessible.
More rural residents qualify for the CCR supplement.
Gig workers must report online platform income.
For more details, visit the CRA’s official page: CRA What's New.