Taxes

Governments collect taxes in order to provide services such as health care, education and highways.

The most common taxes in Alberta are:

  • income tax
  • sales tax
  • property tax

Income tax

Each year, you must declare your past year's income to the Canada Revenue Agency (CRA). The amount of income tax you must pay depends on your taxable income. All of your sources of income must be reported on your tax form.

Incomes earned in Canada that are required to be reported on a Canadian tax return are:

  • income from employment in Canada
  • income from a business carried on in Canada
  • taxable part of Canadian scholarships, fellowships, bursaries, and research grants
  • taxable capital gains from the disposal of taxable Canadian property

Taxpayers include:

  • residents of Canada who are subject to Canadian income tax on their world wide income
  • non-residents and deemed residents who visit Canada for less than 183 days in a year will pay Canadian income tax only on income earned from Canadian sources
  • non-residents, who visit Canada for a total of 183 days or more in a year, may be deemed to be residents of Canada and subject to Canadian income tax on their world wide income for the entire year

Sales tax

The federal government also gets money from a five percent (5%) sales tax called the Goods and Services Tax (GST). GST is added to the price of every purchase except for basic groceries, rent, used goods and other services, like some health care and education services. Basic groceries are foods you have to take home to prepare before eating. GST must be added to the price of other types of food.  

Property tax

If you own a home, buildings or land, you will have to pay property tax to the local (city, town or county) government. The amount depends on the value of your property and where you live. Property tax assessments are mailed to property owners once a year. If you are renting your home you do not have to pay property taxes.