Self-employment income is the income you earn from trade, a profession, commission, or a business such as farming, or fishing. You can be a sole proprietor, professional, independent contractor, or have a partnership business to earn self-employment income. It can be a part-time business activity that helps you gain profit. This can include income from a business, a profession, commission, farming, or fishing.

The RRSP deduction refers to the amount that a taxpayer can deduct from their income and contribute to a Registered Retirement Savings Plan. The CRA determines the RRSP deduction limit for every taxpayer based on their Manitoba income tax brackets.

Capital gains in Manitoba are taxable and you are legally required to disclose capital gain profits in your tax returns. Depending on the type of capital property you have sold to earn a capital gain, you can calculate and report your capital gain income with the help of Schedule 3, Capital Gains and Losses.

An eligible dividend is a dividend issued by a Canadian Corporation to Canadian residents and the dividend income is taxable. Most large corporations give out eligible dividends meaning their dividends are taxable. Before a corporation issues a taxable dividend, it issues a notification to its shareholders if the dividend is eligible or not.

Small business corporations in Canada payout ineligible or non-eligible dividends. Ineligible dividends are also called regular, ordinary, and small-business dividends. The ineligible dividends are taxed at a lower rate as compared to eligible dividends. Canadian corporations that are not eligible for an eligible dividend tax credit, payout ineligible dividends.

Most government benefits received by a taxpayer are taxable. The Canada Emergency Response Benefit (CERB) and Canada Emergency Student Benefit (CESB) are taxable as they are a part of a person’s income. Such government benefits are reported on your Tax form in the Other Income section as they are a part of your taxable income.

Interest income refers to the interest payments you receive on your investments such as interest income on preferred shares or bonds. Interest income is taxable under federal laws and is to be reported on your tax form.

In Canada, ordinary dividends or non-eligible dividends refer to the dividends paid by small corporations which are not eligible for ‘eligible dividend tax credits’. Because the annual turnover of such corporations is lower than other large corporations, their income is also taxed once and at a lower rate. The marginal tax rate for ordinary dividends is 15% if you are in the lowest tax bracket.

Qualified dividends are usually called eligible dividends because they are tax eligible. Corporations that pay out eligible dividends are eligible for ‘eligible dividend tax credits’.

Passive income is a type of income that you earn while not being actively involved in earning it. For instance, if you rent out a property and earn rental income, it is passive income. Similarly, dividends, royalties, and interest income are passive incomes.

Other Income is income other than your salary. It can be income from a property you’ve rented out, income from a side business, or income in the form of dividends or interest. Other Income is disclosed in the ‘Other Income’ section at the bottom of tax returns.

Tax exemption refers to income or a portion of income that is not taxable. If your income is exempt from taxes, you’ll have to report it on your tax returns to benefit from it and reduce your tax liability. For instance if you earn $9,936 or less during the year (Manitoba’s basic personal amount), your income will be exempt from taxes.

The CRA has set a maximum amount that you can contribute to your tax-free savings account TFSA. To gain maximum benefit from the maximum TFSA limit, check your TFSA contribution room. Higher contributions to the TFSA can reduce your overall tax liability as contributions to TFSA are not tax deductible for income tax purposes.

Mortgage interest refers to the interest you pay to the lender when you purchase property on loan. Taxpayers in Canada may be eligible for tax-deductible mortgage payments if their mortgaged property is used to generate rental income.

Taxpayers can claim tax credits on charitable donations. If you have been planning to donate a portion of your income, it is beneficial to know that you can claim tax credits on charitable donations that you make to registered charities that are recognized by the Canada Revenue Agency CRA.

Students who took out loans to pay for their education can claim the interest they pay on their loans to reduce their tax liability.

The CRA’s Guide P105, Students and Income Tax can help students find out which tax credits they can claim on their tax returns. If you are a student and want to claim tuition fee tax credits, you can contact your educational institution for a T2202 form. If you are a commuter to the U.S for education or study at a university outside Canada, you can use the form TL11A, TL11C, or TL11D listed on the CRA’s website.

The disability tax credits are available to physically challenged taxpayers as well as mentally challenged taxpayers. Mentally impaired individuals can fill out the form T2201 to find out if they are eligible for disability tax credits. Printed application forms and supporting documents must be sent digitally to the CRA to prove the medical conditions.

Many other such Manitoba tax deductions and tax credits that you could be eligible for, can reduce your overall tax liability. Visit the CRA website or a tax expert to find out how you can reduce the taxes.