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Teaching Taxes
Why we pay taxes
Many of the services and benefits we enjoy today are made possible through taxes. We pay taxes on our income, property, and on most goods and services we purchase in Canada. The government collects these taxes to pay for such things as roads and highways, hospitals, education, health care, national defence, police and fire services, parks and playgrounds, libraries, garbage collection and many other programs and services.
Tax revenue also helps redistribute wealth to benefit lower-income individuals and families by funding social programs such as the old age security pension, Canada child benefit and social assistance.
- Pose these questions:
- Why do we pay taxes?
- What does the government do with the money collected?
- Give each student two blank sticky notes. On one note, students record something that we pay taxes on. On the other note, they record something funded by tax revenue. Students share their ideas and post their notes on a T-chart under the headings: “Taxable items” and “Tax revenue benefits.”
Completing a simple income tax and benefit return
Students complete a tax return for a high school student with two part-time jobs, using the instructions included in their workbook.
Exercise 1 – High school student
- Catherine Casey was born on November 13, 2000.
- She works part-time at Best Bookstore and Mario's Pizzeria.
- Last year she earned $300 in tips from Mario's Pizzeria. They are not included on her T4 slip.
- Catherine's T4 slips are shown below.
To complete this return, you need:
- T1 General, Income Tax and Benefit Return
- Schedule 1, Federal Tax
If your province of residence is Quebec: use Exercise 1(QC) – High school student (Quebec)
- Employer’s name: Best Bookstore
- Employee’s name and address: Casey, Catherine, 123 Main Street, City, Province, X0X 0X0
- Year: 2017
- Box 12 (Social insurance number): 123456789
- Box 28: indicates CPP/QPP exempt
- Box 14 (Employment income – line 101): 3,600.00
- Box 18 (Employee’s EI premiums – line 312): 67.68
- Box 22 (Income tax deducted – line 437): 150.00
- Box 26 (CPP/QPP pensionable earnings): 0.00
- Employer’s name: Mario's Pizzeria
- Employee’s name and address: Casey, Catherine, 123 Main Street, City, Province, X0X 0X0
- Year: 2017
- Box 12 (Social insurance number): 123456789
- Box 28: indicates CPP/QPP exempt
- Box 14 (Employment income – line 101): 2,600.00
- Box 18 (Employee’s EI premiums – line 312): 48.88
- Box 22 (Income tax deducted – line 437): 101.00
- Box 26 (CPP/QPP pensionable earnings): 0.00
- Date modified:
- 2018-01-04