I’d love to see a combined tax brackets table in TaxCycle. Some place I can see what bracket their current taxable income sits them in and also the other income rates of the brackets above that. Somewhat similar to the combined rates here at taxtips.
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You realize that chart just gives you the MARGINAL rates, not the actual (effective) rates, right? TaxCycle gives you the ability to quickly estimate the effective tax (both amount and rate):
It would be helpful to see the marginal rate as well in TaxCycle - on the T1 summary would work well. Our clients are often interest to know their marginal rate when we deliver their tax returns.
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@Nezzer Thanks for the suggestion, but yes, I want the marginal rates, not the effective rates. I will often explain to clients that they’re paying $X in tax which is Y% of their taxable income on average, but I also want to be able to easily tell them that their next dollar is taxed at Z%.
Just having the current marginal rate on the T1 Summary as Fabien noted would help with this.
The planner’s a decent option for the next year, but doesn’t help in the current year. I also often use the scenarios function which is helpful for looking at different options side by side. But even my statement above about discussions with clients isn’t really what I’m getting at.
We have a combined 11 tax brackets in BC and so it would be helpful to know where the client currently sits, the combined rate of that bracket and also the rates and brackets above this without having to refer to an outside resource. On top of that, to see side by side where the taxpayer’s income stands in conjunction with this table. Thinking about this further though, I feel like we may be able to build something in house in a template to give me what I want…
Marginal rate is my typical go-to. And I just add or subtract $10K in income (or expense) to get it. Not tough, not time-consuming, but yes, it would be “nice” to have an instant view of it. Certainly not a game breaker though.
I would see that issue at best as wasted effort, and at worst misleading.
Why?
Because individual circumstances very frequently make such simplistic calculations not relevant for a particular client, not to mention their spouse and/or dependents effects, in the analysis and interpretation of their situation, and the resulting advice.
Taxpayers may be on the cusp of gaining or losing GIS. On the cusp of gaining or losing OAS clawback. Medical premium assistance (recently changed in BC), medical expense threshold; RRSP deductions/contribution room. etc etc. Also, different types of income affect marginal rates differently on an effective basis.
Tax preparation software is tax preparation software.
Currently, one can quickly and very easily do things like add $1,000 to T4, to Dividends, to RRSP, to Business income, to Capital Gains etc to quickly and easily see its direct knock-on effects to tax, to CPP premiums, etc etc, then separately use your other knowledge and spreadsheets etc to check on OAS, CPP, Medical, Ex-spouses, etc etc etc etc
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"The planner’s a decent option for the next year, but doesn’t help in the current year. "
Ok, that is confusing.
By the “current year” we are talking about APRIL OF THE FOLLOWING YEAR, when Tax PREPARATION is being done to REPORT historical income for the PREVIOUS year.
Absent a TARDIS to go back in time, what chicanery would be involved in going back and changing some type of historical income? “What if” “instead of working LAST YEAR you had done something else?” - “Let as now plan for the past”.
To make any sense, a client would have to be very specific in what they might be wondering about in any query about their financial history.