Do you know how much tax you will pay?

As a Canadian Tax Payer we all know, how much Tax refund we have received or how much we owed to CRA. Unfortunately most of us do not know our total tax bill.

Typically, in a T4 slip there are three major Tax Deduction. These are Income Tax, CPP (Canada Pension Plan Tax), EI (Employment Insurance Tax).

Tax rate for CPP is 4.95% and  EI is 1.73% of your total income. CPP is maxed out at $47,200  for 2010 and maximum CPP tax is $2,163.15. EI is maxed out at $43,200  and maximum EI us $747.36.

Income Tax on the other hand never max out. Income Tax and tax rate increase progressively with increase of your income. Combining these three major taxes on your T4 slip, at a minimum everyone in Canada pays 22% of their income in taxes.

Watch the video below and you will be surprised how much tax you pay to CRA.