The basic personal amount is a tax credit available to anyone who paid income tax during the tax year. The impact of this tax credit is that any income you earned up to the amount of the credit is essentially tax free.
For the 2009 tax year, the federal Basic Personal Amount was $10,320 and will reduce the amount of tax payable on the first $10,320 by $1,548. Therefore, the first $10,320 of income earned in 2009 will not be taxed.
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{ 9 comments… read them below or add one }
Interesting, I didn’t know it was that specific amount. Did CRA raise that level a bit over the past few years? I could have sworn that the basic personal amount was below the $10,000 mark not long ago.
Last year the basic personal amount increased above $10,000. It generally increases annually.
You say that “The basic personal amount is a tax credit available to anyone who paid income tax during the tax year”.
I want to ask if this amount is also available for someone who received social help and didn’t pay any income tax?
Hi Cristina,
The credit is non-refundable so if no tax was payable to begin with, the credit will not create a refund. However, someone who received social assistance should sill file a return as there may be some provincial refundable credits. Filing also entitles you to the GST credit as well as some other social assistance for seniors.
Do you still have to pay CPP for that amount?
CPP is based on pensionable self-employment earnings. Line 303 is a tax credit.
In 2009, I earned a “total income” of $8481 (line 150) with taxable income of $4756 (line 260).
My total refundable tax credits were $3,330 (line 350).
So, in light of the explanation of “basic personal amount” above, my question is about why, on line (C)/404, it says “tax on taxable income”. If my total earnings were well below the basic personal amount, what does this “taxable income” refer to please? Thanks.
In 2009, I earned a “total income” of $8481 (line 150) with taxable income of $4756 (line 260).
My total refundable tax credits were $3,330 (line 350).
So, in light of the explanation of “basic personal amount” above, my question is about why, on line (C)/404, it says “tax on taxable income”. If my total earnings were well below the basic personal amount, what does this “taxable income” refer to please? Thanks.
In 2009, I earned a “total income” of $8481 (line 150) with taxable income of $4756 (line 260).
My total refundable tax credits were $3,330 (line 350).
So, in light of the explanation of “basic personal amount” above, my question is about why, on line (C)/404, it says “tax on taxable income”. If my total earnings were well below the basic personal amount, what does this “taxable income” refer to please? Thanks.