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| *Ostroff, Fair and Company>>>Canada Taxes |
Taxes for Part Time Job? |
If I have a full time job making over 42,000 per year. If I get a part-time job, paying minimum wage, how much tax should I request they take off my part-time job cheque so I don't end up paying taxes at the end of the year? Thanks "W4" answers are clearly US-oriented, ignoring your "Canada" identification, though they may not be too far off base. You probably needn't worry much. Your part-time employer will deduct tax at the minimum rate (approximately 22-35% depending on your province) which is lower than your actual rate (approximately 32-48%), and this is undoubtedly what concerns you. However they will also deduct CPP and EI which will duplicate deductions at your full-time job and will therefore help "top up" your deductions. Any "net" under-deduction will probably be quite small. However you may request an extra deduction if you wish to be certain. This is done on the TD1 forms you will complete for the new job (one federal form, one provincial/territorial form). The extra deduction must be a specified $ amount per pay period, not a percentage, so you'll have to estimate your total earnings for the year to do a calculation. You haven't given enough detail for an accurate estimate - we'd need to know your expected part-time earnings per period (week or month), your province or territory, when you plan to start, and whether you are concerned about the current (partial) year or the next (full) year. However, as a very rough guide, I suggest that an extra deduction of approximately 10% of your part-time income will be sufficient to give you peace of mind. Source(s): 35+ years' experience You can claim the exemption of 10 on your W-4 without causing questioning from IRS. If you claim more than that, HR and IRS may not like it. When you fill out a w-4 with your employer, fill it as one exemption. (if you are married, check off "married, but deduct at the higher single rate") They will take off the amount of the tax that you make on the part time job. If you don't want to end up paying tax at the end of the year, then phone the tax dept and ask if you can make monthly payment, or go to H&R Block, they can tell you what you want to know. When filling out W-4 at the new place, look at both pages and instructions for 2-job employees. Based on the calculation, fill in an additional amount you want to be withheld from every paycheck. The other strategy is to multiply the new earnings times your marginal tax rate for prior year (if your full time earnings are the same) and put is as additional to be withheld. Please note that it's the tax bracket rate that you need to multiply by. For example, if your effective tax rate was 22%, the bracket is 25%, if it was 13%, the tax bracket is 15% |
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