The CRA, or Canada Revenue Agency, income tax is the federal tax the Canadian government charges on income earned in Canada, according to the Canada Revenue Agency. Individuals who earn income in Canada must file an income tax return if they owe taxes; are sent a request to file taxes; received working income tax benefit advance payments; have to contribute to the Canada Pension Plan; have to repay government benefits; or got rid of capital property.
Individuals can file a return to claim a refund or other government benefits or tax credits even if they are not otherwise required to file, states the Canada Revenue Agency. Canadian federal tax rates are based on income. As of 2015, individuals are taxed 15 percent on the first $44,701 they earn. Individuals pay 22 percent on the next $44,700, and 26 percent on the next $49,185 of taxable income. All taxable income over $138,586 per year is taxed at a rate of 29 percent.
In addition to federal taxes, individuals must pay tax in their province or territory, explains the Canada Revenue Agency. Tax rates vary and increase as income increases, except in Alberta where all income is taxed at a rate of 10 percent.