Tax Returns, What the Hell?

[Poho]

This past year, i made $15,000 or so, and had about $550 deducted for taxes. I was able to claim my tuition fees for last year as well, $2,300. Why the hell is my tax return on $150? My understanding is that you don't get taxed if you make less then $20-22,000 a year...but apparently even with my tuition and other tax credits, I owed the government $400 of tax, meaning I only got $150 back. How the fuck does that work? How are they allowed to collect tax from students way below the Canadian Poverty line?

[Robimus]

Maybe I can help, I do my own taxes each year and hopefully have a handle on some of this

Your basic tax exemption(if thats the right term) is only $9600. Basically if you made less than $9600 dollars you don't have to pay tax. The poverty line has no bearing.

A good rule of thumb if your in the lowest tax bracket would be to make sure 15% of your income is taken for taxes. It's not 100% accurate, but its a close, ballpark figure.

Basically your being taxed on $3100 of your income if you made $15,000. Going by my rough 15% ratio you would owe $450 dollars or so. They deducted $550 dollars, thus you get the difference back, in your case I guess $150 dollars or so.

The lowest bracket is generally that easy and the numbers you gave look right from my experience.(I've been doing my own taxes for like 17 years).

Now thats not to say that the tax collectors aren't bad people or that they don't take too much money, but your numbers look right to me in simplistic form.

[Poho]

well, that makes sense then i guess. it's still totally gay though.

[Jeepmanhastj]

Originally Posted by Poho

well, that makes sense then i guess. it's still totally gay though.

Even better is that if you find a way to make money and think you can keep it away from the CRA (ie not pay taxes on it) and they find out about this loophole (whatever it may be) CRA will not only tax it immediately for everyone but will go back for as long as you were doing it and tax you retroactively.
They make up rules for whatever they want and for as far back as they want.

Be glad they took enough off your paychqs
and you get some back. Most people have to pay taxes.

You could always save income for when you aren't working(retirement or non-work year) by deferring it to an RSP. then you get that credit at year end.
They're good to take out when your yearly income is at it's lowest (lower tax bracket too)
Once you're making the big bucks later on, paying out the 30% plus taxes - put some away. You'll 1) get a tax break at yr end and 2) The more you put away the less years you'll have to work before retiring.

You can see what your RSP eligibility is on your tax return confirmation.

[Team Jetfire]

I am not sure why it is 'totally Gay'?

At least you got a tax return...

[Tiamat]

Feel better- mine was about 90 bucks.

[Agent-GHQ]

This is why I'd prefer to get paid under the table while in college. But you didn't hear this from me.