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Marginal tax rate - delta_november

Apr. 15th, 2006

03:59 pm - Marginal tax rate

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I sit here on a glorious sunny Saturday trying to finish off my taxes. I think I've broken the back of it now, but it's taken far too long. Next year I may get some software to help it along.

For a while I've been wondering what my marginal tax rate really is. This year, thanks to having to recalculate based on a $13 piece of investment income that snuck up on me, I now know. For every additional $1.00 that I make, the government takes $0.43. Of that, $0.26 is federal and $0.17 is provincial.

I'm taxed on the other end too. While my major expense (rent) isn't taxed, it's also not marginal: if I find a $100 windfall, I'm not going to rent a larger house. Instead, I'd likely buy something that's taxed at 15% for GST and PST. Adding it all up, an additional $1.00 of income gives me a purchasing power of $0.4956. Let's call it $0.50 in even numbers. So the government gets to keep half, and I can spend the rest.

At least now I know :P.

Comments:

From:(Anonymous)
Date:April 15th, 2006 08:27 pm (UTC)

not too late for software

(Link)
H&R Block is letting people download TaxCut for free at the following link:

http://www.hrblock.com/taxes/partner/product.jsp?productId=31&otpPartnerId=1199&CID=222021&WT.mc_id=4_5_222021
(Reply) (Thread)
From:mpragnes
Date:April 15th, 2006 08:31 pm (UTC)

Re: not too late for software

(Link)
i downloaded this and it worked great -- thx!
(Reply) (Parent) (Thread)
[User Picture]
From:delta_november
Date:April 15th, 2006 09:02 pm (UTC)

Re: not too late for software

(Link)
Wow, but my humble journal is popular today :).

Thanks, but I've got the paper version finally done. At this point I don't want to know if the software gives me different numbers :).
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