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Personal Tax -> TD1 forms
Business -> TD1 forms

TD1 forms - Make sure they are up to date.

Canada Revenue Agency provides employers with TD1 Personal Tax Credits Return forms, both federal and provincial.  Employees and pensioners complete the federal form, as well as the form for their province/territory of residence, indicating which non-refundable tax credits they can claim.  The total of the claimable credits is then used to determine the employee's or pensioner's federal or provincial claim code, which is used to calculate how much income tax will be deducted from their pay.

New employees complete the TD1 forms when they are hired,  and are not required to complete them again unless they want to change their claim amounts.  Completing the form allows tax deductions to be reduced if the employee is eligible for tax credits other than the basic personal exemption.  Students can report their tuition, education and textbook amounts on this form to reduce their tax deductions.  This form should be filled out when starting new employment, or when there is a change in your entitlement to personal tax credits.  If no TD1 form is filled out, the employer will calculate taxes using only the basic personal exemption.

If you are in a temporary or part-time job, and you know that your total income for the year will be less than your total personal tax credits on the TD1 form, you can check the box on page 2 of the form, and your employer will not deduct tax from your earnings.

The federal child amount tax credit for dependent children under 18 was new for 2007.  The federal TD1 form should be changed when an employee has a new baby or adopted child, or a child who is now 18 and no longer eligible for this credit.  Other circumstances could require a change in the federal or provincial/territorial forms, such as getting married or divorced, uniting with or splitting up with a common-law spouse, turning age 65, or becoming eligible for the disability tax credit (doctor certification required).

If you have employment income, as well as income from sources where no withholding tax is deducted, such as rental, investment, or self-employment, you can avoid having to pay tax instalments by indicating on your TD1 form an additional tax amount to be deducted.

The federal and provincial/territorial TD1 Personal Tax Credits Return forms can be found on the CRA website.

The CRA T4032 Payroll Deductions Tables have tables indicating the federal and provincial/territorial TD1 claim codes based on the total claims entered on the TD1 forms.

Commission employees - TD1X form

Commission employees who are able to claim expenses (see the employment expenses article) can complete the TD1X, Statement of Commission Income and Expenses for Payroll Tax Deductions, so that their expenses are taken into consideration in the calculation of the income taxes deducted from the commission.

Québec

The Québec equivalent to the TD1 form is the Source Deductions Return TP-1015.3-V, found on the Revenu Québec website.

Other articles

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Take-home pay calculators, to check your payroll tax calculations

Employers

Employers now have the ability to create a provincial or territorial Form TD1 Personal Tax Credits Return and have the employees send the form electronically rather than on paper.  See Electronic Form TD1 on the CRA website.

Tax Tip for employees:  Update your TD1 forms if you have changes to your non-refundable tax credits.

Revised: December 29, 2011

 

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