Canada's tax system

Canada's tax system is based on the self-assessment principle which means that you have to complete a tax return each year to report your income and calculate whether you owe tax or receive a refund.

The self-assessment tax system is considered the most economical and efficient way to collect income tax.

What the Canada Revenue Agency does

The Canada Revenue Agency administers the tax laws for the Government of Canada and for most provinces and territories. It is responsible for collecting taxes and other amounts, such as:

  • federal, provincial, and territorial income tax
  • goods and service tax/harmonized sales tax (GST/HST)
  • Canada Pension Plan contributions
  • employment insurance premiums

The Canada Revenue Agency also delivers various benefit and credit programs to Canadians through the tax system.

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