TurboTax: T1 General Federal Tax Payable






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Relevant Material: "

Line 42000 – Net federal tax

Your net federal tax is calculated on your return. It is your federal tax payable on your taxable income minus your federal non-refundable tax credits and various other federal tax credits that may apply to you.

Recapture of investment tax credit

If you have to repay all or part of an investment tax credit that you previously received for scientific research and experimental development or for child care spaces, complete Form T2038(IND), Investment Tax Credit (Individuals), to calculate the amount you have to repay.

Enter the result on the line for "Recapture of investment tax credit" on your return.

Federal logging tax credit

If you paid logging tax to a province for logging operations you performed in the province, you may be able to claim a logging tax credit.

To calculate your credit, use the lesser of the following two amounts for each province you had a logging operation in:

  • 66.6667% of the logging tax paid for the year to the province
  • 6.6667% of your net logging income for the year in the province

Enter the total of the credits for the year for all provinces, up to 6.6667% of your taxable income from line 26000 of your return, not including any amounts on lines 20800, 20805, 21000, 21400, 21500, 21900, and 22000 of your return... " (www.cra.gc.ca)

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Relevant Material: "On the T1 General (now officially the Income Tax and Benefit Return), Line 42000 (formerly Line 420) represents your Net Federal Tax. 

Significance of Line 42000 (Federal Tax Payable)
  • Final Federal Liability: It is the final amount of federal income tax you owe for the year after all non-refundable credits (such as the basic personal amount, tuition, or medical expenses) have been subtracted from your gross federal tax.
  • Calculation Source: This amount is typically calculated on Schedule 1 and then transferred to the T1 return.
  • Key Component of Total Payable: It is one of the primary figures used to determine your Total Payable (Line 43500). To reach this total, Line 42000 is added to other obligations like provincial taxes, CPP contributions on self-employment, and EI premiums.
  • Determines Refund or Balance: Once your total credits (tax already withheld by employers or paid in installments) are subtracted from the total payable, Line 42000 helps determine if you will receive a refund (negative result) or have a balance owing (positive result). 
Key Context
  • Reporting: It reflects your federal tax obligation specifically. Provincial or territorial tax is calculated separately on Form 428 and reported on Line 42800.
  • Modern Form: In 2019, the CRA switched to 5-digit line numbers; Line 420 is now Line 42000. .." (Google) 
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