2024 AB Budget Highlights
2024 Alberta Budget Highlights
On February 29, 2024, Alberta’s Minister of Finance, Nate Horner, tabled the province’s 2024-2025 budget. We have highlighted selected tax measures relevant to individuals and small businesses in Alberta.
INDIVIDUALS
Personal Tax Rates
The budget did not propose any changes to individual income tax rates for 2024 and has continued indexation of tax brackets for the 2024 taxation year. Many Albertans will see the benefit of indexation through lower tax withholdings on their first paycheques of 2024. In addition, since indexation has continued for 2024, Albertans will receive larger refunds or owe less tax when they file their 2023 tax returns in spring 2024.
Provincial Income Tax Brackets and Tax Rates
| 2023 Taxable Income | 2024 Taxable Income | Rate |
|---|---|---|
| $0 up to $142,292 | $0 up to $148,269 | 10% |
| $142,292 up to $170,751 | $148,269.01 to $177,922 | 12% |
| $170,751 up to $227,668 | $177,922.01 to $237,230 | 13% |
| $227,668 up to $341,502 | $237,230.01 to $355,845 | 14% |
| Over $341,502 | Over $355,845 | 15% |
Top Combined Alberta and Federal Rates
| Income Type | 2023 | 2024 |
|---|---|---|
| Salary, interest, pension, foreign | 48.00% | 48.00% |
| Eligible dividends | 34.31% | 34.31% |
| Non-eligible dividends | 42.31% | 42.31% |
| Capital gains | 24.00% | 24.00% |
Top tax rates apply to taxable income over $341,502 (2023) and $355,845 (2024) based on known federal and Alberta rates at February 29, 2024.
Introduction of Lower Tax Bracket – Starting 2026
- To continue Alberta’s tax advantage, the government intends to introduce a new tax bracket for income up to $60,000.
- Expecting the tax cut to be gradually implemented over two years, starting 2026.
- In 2026, a new 9% bracket will be introduced for income up to $60,000.
- The rate will then be reduced to 8% per cent in 2027.
Alberta is Calling - Refundable Tax Credit
- To address Alberta’s labour shortages in skilled trades, the province is offering a one-time $5,000 refundable tax credit to eligible workers who relocate to Alberta.
- Applicable to individuals who move to Alberta after April 2024 and meet additional eligibility criteria.
- Must work in specified occupations, live in the province for at least 12 months, and file their personal 2024 tax return as Alberta tax residents.
Consumer and Other Taxes
- Fuel tax collection will be determined quarterly based on average oil prices and the rates will be reduced as the average WTI price rises
- Will remain at $0.09 per litre until at least March 31, 2024
- Education property tax rates will be frozen for the 2024/2025 period, but the province expects that strong growth in property values and increased development will result in an increase in total funding
- Residential/farmland rate will remain at to $2.56 per $1,000
- Non-residential rate will remain at to $3.76 per $1,000
- To address the wear and tear on provincial roadways that Elective Vehicles (EVs) cause with no corresponding contribution to fuel tax revenue, the government is introducing a new $200 annual tax on EVs
- Targeted start date of January 1, 2025
- Paid when owners register their vehicles
- Does not apply to hybrid vehicles
- Starting January 1, 2025, vaping substances sold in Alberta will be subject to provincial tax at the same rate as the federal tax on vaping substances:
- $1 per 2 millilitre (mL) or gram (g), or fraction thereof, for the first 10 mL/g of vaping substances in the vaping device or container, plus
- $1 per 10 mL/g, or fraction thereof, for amounts over the first 10 mL/g.
- Effective March 1, 2024, the tax on cigarettes will increase by 2.5 cents to $0.30 per cigarette and the tax on smokeless tobacco will rise by 7.5 cents to $0.35 per gram
- Starting October 1, 2024, online brokers for short term accommodations, such as Airbnb, VRBO and Expedia will be required to collect and remit the 4% provincial Tourism Levy
- Short term rental hosts will be required to directly collect and remit the applicable tourism levy on stays booked before October 1, 2024
BUSINESSES
The budget did not propose any changes to corporate income tax rates or introduce new corporate tax credits, and it did not change the $500,000 provincial small business income threshold. The rates below reflect a December 31st year-end.
| Income Type | Alberta Rate | Federal Rate | Combined Rates Calendar 2024 |
|---|---|---|---|
| General corporate income | 8.00% | 15.00% | 23.00% |
| Small business income | 2.00% | 9.00% | 11.00% |
| CCPC* investment income | 8.00% | 38.67% | 46.67% |
| Non-CCPC investment income | 8.00% | 15.00% | 23.00% |
| Manufacturing and processing income |
8.00% | 15.00% |
23.00% |
*Canadian-controlled private corporation
Based on known provincial and federal rates at February 29, 2024
Refer to the 2024 Alberta Budget for further details.
This has been prepared by the Total Wealth Solutions Group of Raymond James Ltd., (RJL). Statistics and factual data and other information are from sources RJL believes to be reliable but their accuracy cannot be guaranteed. It is for information purposes only and is not to be construed as an offer or solicitation for the sale or purchase of securities nor is it meant to replace legal, accounting, taxation or other professional advice. We are not tax advisors and we recommend that clients seek independent advice from a professional advisor on tax-related matters. The information is furnished on the basis and understanding that RJL is to be under no liability whatsoever in respect thereof. This is intended for distribution only in those jurisdictions where RJL and the author are registered. Securities-related products and services are offered through Raymond James Ltd., Member - Canadian Investor Protection Fund. Insurance products and services are offered through Raymond James Financial Planning Ltd., which is not a Member - Canadian Investor Protection Fund.