Personal Finance

2nd job tax/cpp/ei question

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Deal Addict
Jan 28, 2008
1387 posts
58 upvotes

2nd job tax/cpp/ei question

So this Is really a question my sister has but she doesn't use this.

She has a full time, 9-5 job that pays 55k for one of the banks. They deduct taxes/ei/cpp.

She has started working part time for another company mainly out of the house. She is an employee not on contract, she received her first payment for December for 42 hours at 16/hour and they deducted ei/cpp and not taxes.
1 - how much should she be saving for taxes at year end approximately. Estimated she will be making 1500/gross per month.
2 - she said she reaches her max ei with the bank and thinks the same for cpp, can she tell the new company not to deduct these contributions or it is beneficial for her to do it? Will she get back the over contributions when she does her taxes?
5 replies
Deal Addict
Jul 21, 2005
2087 posts
1134 upvotes
Alberta
EI and CCP will de deducted no matter what as one company can't tell how much she paid to the other, but don't worry, at tax time, she will get it all back. I went through this part myself as I switched jobs close to end of the year and had to pay into everything again.

As for the taxes, it's a bracket system, so look here for the federal and provincial portions

http://www.cra-arc.gc.ca/tx/ndvdls/fq/txrts-eng.html

Keep in mind that this taxes is on top of her normal pay, so if she was making 55k at the bank and is gonna be making another 20k per year, she will be taxed at the marginal rate of 20.5% federally + whatever provincially.
Deal Addict
Jan 28, 2008
1387 posts
58 upvotes
I should have posted I told her to estimate about 4800in taxes owed (from 55000 to 75000) which she expects to go to.

So looks like I'm pretty close. She's paying off all her debt with this money so trying to pay as much as she can every month.

Edit - she's in Ottawa.
Deal Fanatic
User avatar
Dec 27, 2009
7941 posts
5483 upvotes
Victoria, BC
eblend wrote: EI and CCP will de deducted no matter what as one company can't tell how much she paid to the other, but don't worry, at tax time, she will get it all back. I went through this part myself as I switched jobs close to end of the year and had to pay into everything again.

As for the taxes, it's a bracket system, so look here for the federal and provincial portions

http://www.cra-arc.gc.ca/tx/ndvdls/fq/txrts-eng.html

Keep in mind that this taxes is on top of her normal pay, so if she was making 55k at the bank and is gonna be making another 20k per year, she will be taxed at the marginal rate of 20.5% federally + whatever provincially.
She'll get the extra CPP and EI payments back, but the employers are still screwed for their contribution amounts. This double dip by the government annoys the crap out of me.
Deal Addict
Aug 19, 2013
2397 posts
1091 upvotes
She can ask her employer to withhold more taxes at source if she wants. But better to just put it in a savings account. She should figure out her marginal tax rate (include federal and provincial). She would then multiply her gross by her marginal rate, subtract the taxes already withheld on the cheque, and then save the difference.

I think her marginal rate on income over 55,000 would be around 31% (assuming Ontario). But that's just off the top of my head and you should look up the rates.
Deal Addict
Aug 17, 2012
1752 posts
742 upvotes
Windsor
Google ees financial take home salary calculator.. It gives pretty close numbers

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