An increased tax credit, that takes effect today in Manitoba, should result in a little more money on your paycheque each month.

In its 2023 budget, our provincial government changed the Basic Personal Amount from $10,855 to $15,000. Now that the budget is law, the change became official on July 1st. The government is prorating the Basic Personal Amount for the remaining six months of the 2023 tax year. 

According to our province, this means that starting the first pay period in July, Manitoba workers will take home up to $75 more per month on their paycheques. For two-income families, that could mean up to $1,800 more per year to spend on things that matter most.

Finance Minister Cliff Cullen says Manitobans have faced unprecedented challenges over the last three years, challenges that required unprecedented government action. Cullen says his government remains focused on maintaining a strong, sustainable fiscal foundation that will provide better services to all Manitobans. This includes investing in front-line services and lowering taxes to make life more affordable for Manitobans and more competitive for Manitoba businesses.

Leo Deurbrouck owns Leo's Mobile Tax Service in Steinbach. He explains what this announcement means is that you are now exempt from paying federal taxes on the first $15,000 of your earnings. 

Deurbrouck says you will not have to wait until filing your income taxes to reap the benefits.

"You should see a small increase in the net pay on each of your individual pay stubs," he notes. 

Then, when you file your taxes, you may be asked to pay a little extra or it could be that you are entitled to a little payback, depending on what shortfall or overpayment may have happened during the course of the year. 

According to Deurbrouck, the Basic Personal tax exemption was about $8,000 prior to 2014. It has been rising steadily ever since. 

"I don't know if I would say it's a big deal, it's pretty common," says Deurbrouck. "It won't be significant, but every little bit helps."