What exactly is the T1213 tax form? Well, another name for it is Request to Reduce Tax Deductions at Source. This means that this form will influence how much tax is taken out of your pay. Before you submit the request to your employer, though, you must submit it to the CRA (Canada Revenue Agency) for approval. Once it’s approved, you receive a letter that you can give to your employer to reduce taxes and have less money deducted from your income.
Filling Out the T1213 & Processing Time
When it comes to filling out the T1213, you can do so through your MyAccount online or fill out a paper application. Once that’s done, you wait for approval before submitting it to your employer to reduce tax deductions on tax-deductible income. That said, it’s important to remember that your application won’t be processed immediately. It can take up to between 4-6 weeks to be processed.
Form T1213 Eligibility
Not everyone will qualify for this, though. There are a few instances in which you should consider filling out a T1213. These are:
- If you make high RRSP contributions
- Get foreign tax credits
- Qualify for a large medical expense tax credit
- Employment expenses
- Interest expenses
- Non-refundable tax credits
Really, if you’re anticipating a tax refund, then this could be a good option for you. You can save money throughout the year by paying fewer taxes instead of waiting until tax time to receive a refund. You can submit this form at any time. It’s recommended that you submit in October for the upcoming tax year. This form will have to be filled out annually.
T1213 OAS
Similar to the original T1213 form, the T1213 OAS form is meant to be filled out if you’re looking to reduce the amount of income taxes you pay. The only difference is that you fill out this version if you’re on Old Age Security, also referred to as OAS. Specifically, you fill out this form if you’re looking to have the amount of Recovery Tax withheld reduced.
More or Less Income Tax?
While the T1213 form will make it so you pay less tax, there may be reasons that you actually want to increase how much income tax comes from your paycheque. This is usually done if you receive the extra benefits of having a second income and want to avoid paying taxes when tax time rolls around.
If this is something that you choose to do, you don’t have to submit this form to the CRA first; it can be submitted directly to your employer. This form is called a TD1, also known as: Personal Tax Credits Return.
TD1 and How Much Extra You Should Deduct
If you choose to deduct more than the basic personal amount of your income, you may be wondering how much more to deduct. Well, that actually depends on how much you earn. Whether you pay it throughout the year or during tax time, it still has to be paid. That said, if you’re hoping to avoid a bill during tax season, then more is better. If you end up paying too much, then you’ll receive a refund.
The best way to figure out what you’ll end up owing is to calculate your annual salary and figure out which tax rate you fall into, federally and provincially. This will give you an idea of how much taxes you’ll likely owe for the year. If you want to take out more for reasons such as capital gains, then you’ll have to calculate the capital gain tax rate.
Federal Tax Rates
| Tax Rate | Income |
| 15% | On the portion of income from $0 – $53,359 |
| 20.5% | On the portion of income from $53,359 – $106,717 |
| 26% | On the portion of income from $106,717 – $165,430 |
| 29% | On the portion of income from $165,430 – $235,675 |
| 33% | On the portion of income that’s $235,675 plus |
Provincial Tax Rates
| Province/Territory | Tax Rate |
| British Columbia | 5.06% for amounts up to $45,6547.7% for amounts between $45,654-$91,310 10.4% for amounts between $91,310-$104,835 12.29% for amounts between $104,835-$127,299 14.7% for amounts between $127,299-$172,602 16.8% for amounts between $172,602-$240,716 20.5% on taxable income above $240,716 |
| Alberta | 10% for amounts up to $142,292 12% for amounts between $142,292-$170,751 13% for amounts between $170,751-$227,668 14% for amounts between $227,668-$341.502 15% on taxable income above $341,502 |
| Saskatchewan | 10.5% for amounts up to $49,720 of taxable income 12.5% for amounts between $49,720 – $142,058 14.5% on the amount over $142,058 |
| Manitoba | 10.8% for amounts up to $36,842 of taxable income 12.75% for amounts between $36,842 – $79,625 17.4% on any taxable income over $79,625 |
| Ontario | 5.05% for amounts up to $49,231 of taxable income 9.15% for amounts between $49,231 – $98,463 11.16% for amounts between $98,463 – $150,000 12.16% for amounts between $150,000 – $220,000 13.16% on any taxable income over $220,000 |
| Quebec | 15% for amounts up to $49,275 of taxable income 20% for amounts between $49,275 – $98,540 24% for amounts between $98,540 – $119,910 25.75% on any taxable income over $119,910 |
| Nova Scotia | 8.79% for amounts up to $29,590 of taxable income 14.95% for amounts between $29,590 – $59,180 16.67% for amounts between $59,180 – $93,000 17.5% for amounts between $93,000 – $150,000 21% on any taxable income over $150,000 |
| New Brunswick | 9.4% for amounts up to $47,715 of taxable income 14% for amounts between $47,715 – $95,431 16% for amounts between $95,431 – $176,756 19.5% on any taxable income over $176,756 |
| Prince Edward Island | 9.8% for amounts up to $31,984 of taxable income 13.8% for amounts between $31,984 – $63,969 16.7% on any taxable income over $63,969 |
| Newfoundland and Labrador | 8.7% for amounts up to $41,457 of taxable income 14.5% for amounts between $41,457 – $82,913 15.8% for amounts between $82,913 – $148,027 17.8% for amounts between $148,027 – $207,239 19.8% for amounts between $207,239 – $264,750 20.8% for amounts between $264,750 – $529,500 21.3% for amounts between $529,500 – $1,059,000 21.8% on any taxable income over $1,059,000 |
| Yukon | 6.4% for amounts up to $53,359 of taxable income 9% for amounts between $53,359 – $106,717 10.9% for amounts between $106,717 – $165,430 12.8% for amounts between $165,430 – $500,000 15% on any taxable income over $500,000 |
| Nunavut | 4% for amounts up to $50,877 of taxable income 7% for amounts between $50,877 – $101,754 9% for amounts between $101,754 – $165,429 11.5% on the amount over $165,429 |
| Northwest Territories | 5.9% up to $48,326 of taxable income 8.6% between $48,326 and $96,655 12.2% between $96,655 and $157,139 14.05% on any taxable income over $157,139 |
