Posts Categorized: Uncategorized

Old Age Security Deferral

Elderly Person

As of July 1, 2013, where receipt of OAS is delayed, the monthly pension is increased by a factor of 0.6% for each month deferred, to a maximum of 36% (60 months, commencing receipt at age 70). This option may be especially desirable for those whose OAS would be entirely clawed back due to high… Read more »

Federal Carbon Tax Costs and Rebates

Air Pollution

On October 23, 2018, draft amendments to the Federal Fuel Charge Regulations and the Greenhouse Gas Pricing Act were released. As of April 1, 2019, a federal carbon tax is scheduled to be imposed in respect of Ontario, New Brunswick, Manitoba, and Saskatchewan. The federal backstop legislation will be partially used in Prince Edward Island,… Read more »

Canadian Pension Plan Changes

Saving Money

Starting January 1, 2019, the CPP will be enhanced. This means that both employees and employers will be required to contribute more, but, retirement, survivor, and disability pensions will also increase. The changes will be gradually phased in over 7 years: Phase 1 will take place from 2019 to 2023; and Phase 2 will take… Read more »

Childcare Costs at Camp

Children Colouring

A September 11, 2018 Tax Court of Canada case examined the eligibility of a number of child care costs with a recreational and educational component. The taxpayer and his spouse worked full time and had two children, aged 10 and 12. The Court acknowledged two separate lines of cases related to eligibility of child care… Read more »

Travel Expenses From Home to Work

Driver

Travel from home to a regular place of employment is usually a personal expenditure, the costs of which cannot be claimed as an employment expense. However, if the taxpayer is required to travel away from the employer’s place of business, amounts may be deductible by the employee. A June 29, 2018 Tax Court of Canada… Read more »

Federal Fall Economic Update to Accelerated Depreciation

Equipment

In response to U.S. tax changes and cuts, the Federal Government released its Fall Economic Update on November 21, 2018 which primarily focused on changes to the first year of depreciation on most capital assets. The changes include immediate full depreciation in respect of manufacturing & processing assets, along with clean energy generation and storage… Read more »

Reporting Hacked Customer Data

Keyboard Typing

Recently, the Office of the Privacy Commissioner of Canada, provided details (see https://www.priv.gc.ca/en/privacy-topics/privacy-breaches/respond-to-a-privacy-breach-at-your-business/gd_pb_201810/) in respect of the new mandatory reporting requirements where breaches of security safeguards have occurred. As of November 1, 2018, organizations subject to The Personal Information Protection and Electronic Documentation Act (PIPEDA), including small businesses, will be required to report breaches involving… Read more »

Tax on Split Income: Taking a Salary vs. Dividend

Business Meeting

Dividends received by individuals from private corporations as of January 1, 2018 may be subject to taxation at top marginal tax rates (due to the new TOSI rules) if, in general, they are determined to be unreasonable. Salaries, however, are not specifically subject to these rules. As such, some may consider replacing potentially unreasonable dividends… Read more »

Active Business vs. Property Income

Meeting

A private corporation’s income from a specified investment business (SIB) is not eligible for the active business tax rates (varying from 10% to 31%, depending on a number of factors, including the total earnings from operations and the province or territory in which it is located). Rather, a corporate investment tax rate of around 50%… Read more »

Director’s Liability With Helping Family

Being a director of a corporation comes with many responsibilities. Failing to exercise due diligence in ensuring source deductions (such as EI, CPP, and income tax) are properly withheld from wages and remitted to CRA may result in a director’s personal liability for the corporation’s outstanding amount. A June 12, 2018 Tax Court of Canada… Read more »