Tuesday, January 11, 2011

2010 Canadian Income

I received my last pay slip for 2010 on the last week of December. It gives me my total earnings for 2010 and the deductions made.

My net Canadian pay for 5 weeks [i.e. 20.5 workdays] + 1 afternoon of orientation is around CAD1,410. Considering that I worked part-time for some weeks and received 7 hours of overtime pay-rate [I believe it's for working on Christmas Eve], it's a pretty decent pay-out for an entry-level job.

Now a quick comparison of the various compulsory government deductions.

General description: Canadian item % VS Singapore item %
* Pension: CPP/QPP 3.65%
   vs CPF* 20% [Employee] + 15% [Employer]
* Employment Insurance: 1.73%
   vs N.A. [No such benefit]
* Health care: Medical Services Plan CAD 60.50 per person per month which is 3.90% of my low-income [In B.C.]
   vs Medisave, Medishield, Medicare* [part of CPF]
* Other taxes: Federal Tax 3.15% [No TV license in B.C.]
   vs TV license $110/year [No Federal Tax in Singapore]
* Income tax: Revenue Canada K.I.V.
   vs IRAS scaled tax rate from 0% to 20%.
* Expenditure Tax: HST 12% [In B.C., excludes fresh/raw food items]
   vs GST 7%

  • Pension is not an apple-to-apple comparison because the Singapore CPF gives you the option to buy property and some selected investments with the CPF money. In comparison, the Canadian CPP/QPP disappears into a collective pension scheme, that currently pays each elderly an inflation-adjusted amount of between CAD400 to CAD1,100/month.
  • Similarly health care is not an apple-to-apple comparison because the Canadian MSP disappears into a collective pool but gives one the assurance that one's hospital bill is fully covered, but the Singapore 3M's technically belongs to the individual.

As explained above, it is not a comparison of identical items. Thus, which country's system suits one better depends on one's situation and preferences. In addition, there are non-financial aspects to consider, which IMHO are also critical aspects of a migration decision. In my case, the Canadian system is the preferred choice.

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