Before Getting a Job
Social Insurance Number
Before you can work in Canada, you will need a Social Insurance Number (SIN). To obtain your SIN you must file an application with Service Canada. You may apply in person to the Service Canada location nearest you or by mail (application form is available online). You must provide your employer with your SIN. There is no fee associated with obtaining your SIN, however, should you lose your card there is a replacement fee.
Once you are working, you will notice that certain deductions may automatically be taken from your pay cheque.
All Canadian residents who are old enough to work must, by law, file an income tax return each year, whether or not they have earned money. If you are working for an employer, a percentage of your pay cheque will be deducted each pay period to pay income tax. If too much is deducted, you will receive a refund when you submit your annual income tax return generally at the end of April. If you have paid too little, you must submit additional payment. Income taxes help fund the cost of government services.
Canada Pension Plan (CPP)
With very few exceptions, every person in Canada over the age of 18 who earns a salary must pay into the Canada Pension Plan. A portion of your pay cheque will be deducted as a contribution to the CPP. You and your employer each pay half of the contributions. If you are self-employed, you pay both portions. The amount you pay is based on your salary. Upon retirement, you will be able to receive a monthly pension from the pension plan. The amount of pension you receive will vary according to your salary and the number of years you have worked in Canada.
Employment Insurance (EI)
When you are working, a small percentage of your pay cheque will also be deducted as a contribution to the federal Employment Insurance fund. Your employer also contributes to this account. If you are unemployed for a short time, you may be eligible to receive employment insurance benefits while you search for a new job.
Taxable Benefits - Your employer may provide benefits such as group life insurance, medical insurance, dental insurance and a pension plan. These are considered taxable benefits. If provided, these benefits will be deducted from your pay cheque.
Union dues - If you are a union member, and the union has an agreement with your employer, money will be deducted from your pay cheque for union dues.