Tax

The deadline for contributing to your Registered Retirement Savings Plan (RRSP) for the 2017 tax filing year is March 1, 2018. You generally have 60 days within the new calendar year to make RRSP contributions that can be applied to lowering your taxes for the previous year.

RRSP Deadline: March 1, 2018

 

The deadline for contributing to your Registered Retirement Savings Plan (RRSP) for the 2017 tax filing year is March 1, 2018. You generally have 60 days within the new calendar year to make RRSP contributions that can be applied to lowering your taxes for the previous year.

 

If you want to see how much tax you can save, enter your details below!

 

 

Continue Reading

It has certainly been a busy week in terms of announcements regarding financial policies for small businesses. Following the series of proposed tax reforms that the government announced back in July, various tweaks and changes have subsequently been made, owing, perhaps in part, to confusion and frustration expressed among the small business community. We have provided a brief summary of the changes in this article and infographic.

It has certainly been a busy week in terms of announcements regarding financial policies for small businesses. Following the series of proposed tax reforms that the government announced back in July, various tweaks and changes have subsequently been made, owing, perhaps in part, to confusion and frustration expressed among the small business community. This week Finance Minister, Bill Morneau, has made further clarifications and adjustments to his original set of proposals, aiming to bring more of a sense of balance to the plans. Like all policy changes, the detail can be a little overwhelming, so here is a summary of the key points for your reference: 

  • The government intends to honor a commitment made prior to the election, to reduce the small business tax rate from 10.5% to 9% by the year 2019. 
  • Morneau confirmed that the government has scrapped the proposal to limit access to the Lifetime Capital Gains Exemption. 
  • The plans announced earlier in the year to reduce the value of passive investments made by corporations will continue in principle, but with few key changes. There will be a threshold of $50,000 of income per year, which will be excluded from the newly set higher rate of tax. 
  • The government has agreed to “simplify” the rules related to the new plans, to prevent income splitting for family members, who are not active in a business, but the plan will still move ahead in principle. 
  • Morneau has confirmed that the government will still provide good entrepreneurial incentives for venture capitalists and angel investors. The criteria for which still needs to be established. 
  • The proposed rules to limit the conversion of income to capital gains have been abandoned due to the concerns that many related to intergenerational transfers and insurance policies were held inside corporations. 

Of course, this is one area of government policy which is not only constantly changing, but particularly controversial in the current climate, so keep yourself updated regularly on new announcements and news, to ensure your understanding in this area and its potential impact on your family and business. If you have any questions, please talk to us. 

Continue Reading

Finance Minister Bill Morneau delivered the government’s 2017 federal budget on March 22, 2017. The budget expects a deficit of $23 billion for fiscal 2016-2017 and forecasts a deficit of $28.5 billion for 2017-2018. Learn what the budget means for families

Finance Minister Bill Morneau delivered the government’s 2017 federal budget on March 22, 2017. The budget expects a deficit of $23 billion for fiscal 2016-2017 and forecasts a deficit of $28.5 billion for 2017-2018. Find out what this means for families.

Key points for families

  • Childcare: The funding could serve to create more affordable childcare spaces for low-income families
  • Parental leave: Extending parental leave and benefits to 18 months, Parents who choose to stay at home longer, however, will have to make do with a lower Employment Insurance (EI) benefit rate of 33 per cent of their average weekly earnings, instead of the current rate of 55 per cent
  • Caregiver benefit: Introduce a new caregiver benefit that’s meant to help families copy with illnesses and injuries.
  • Parents who go to school: Single, higher federal income threshold for part-time students to receive Canada Student Grants. Grants don’t have to be repaid.
  • Foreign Nannies: Waiving a $1,000 processing fee required to obtain a work permit.

Please don’t hesitate to contact us if you have any questions.

Continue Reading

Finance Minister Bill Morneau delivered the government’s 2017 federal budget on March 22, 2017. The budget expects a deficit of $23 billion for fiscal 2016-2017 and forecasts a deficit of $28.5 billion for 2017-2018. Learn what the budget means for small business owners

Finance Minister Bill Morneau delivered the government’s 2017 federal budget on March 22, 2017. The budget expects a deficit of $23 billion for fiscal 2016-2017 and forecasts a deficit of $28.5 billion for 2017-2018. Find out what this means for businesses.

Small Business

  • No changes to income tax rates
  • No changes to capital gains inclusion rate

Tax Planning using private companies

While no specific measures are mentioned, the government will review the use of tax planning strategies involving private corporations “that inappropriately reduce personal taxes of high-income earners.” including:

  • Income Splitting: Reducing taxes by income splitting with family members who are subject to lower personal tax rates.
  • Regular income to Capital Gains: Converting income to capital gains (instead of income being taxed as dividends)
  • Passive income inside Corporation: Since corporate income tax rates are generally lower than personal tax rates, this strategy can facilitate the accumulation of earnings by owners of private corporations.

For Professionals

The government eliminated a tax deferral opportunity for certain professionals. Accountants, dentists, lawyers, medical doctors, veterinarians and chiropractors will no longer be able to elect to exclude the value of work in progress in computing their income. This will be phased-in over two taxation years, starting with taxation years that begin after this budget.

Please don’t hesitate to contact us if you have any questions

Continue Reading

With the tax filing due April 30, we've included some tax deductions for families to notice for the 2016 taxation year.

With the tax filing due April 30, we’ve included some tax deductions for families to notice for the 2016 taxation year.

    • Canada Child Benefit: The Canada child benefit is a tax free monthly payment to help eligible families with the cost of raising children.
    • Child Care Expenses: If your kids attend a daycare or a child care program, you or your spouse might be able to claim what you spent in 2016.
    • Child Disability Benefit: You can qualify for this tax-free benefit if you care for a child under age 18 who is eligible for the disability tax credit.
    • Children’s art tax credit: For 2016, claim up to $250 eligible fees for your child’s prescribed program of artistic, cultural, recreational or development activity.
    • Children’s fitness tax credit: For 2016, claim up to $500 eligible fees for your child’s prescribed program of physical activity.
    • GST/HST sales tax credit: Receive tax-free payments in January, April, July and October if you are eligible.

If you have any questions, please contact us and we can connect you with a tax professional.

Continue Reading

With the tax filing due April 30, we've included new tax highlights for the 2016 taxation year.

This tax-filing season, many important changes and improvements were made to services, benefits and credits for Canadians. Here’s what you need to know:

New and Improved Benefits and Credits

    • Canada Child Benefit: The Canada child benefit is a tax free monthly payment to help eligible families with the cost of raising children.

Other Changes

    • Income Splitting Tax Credit: The family tax cut has been eliminated for the 2016 year and future tax years.
    • Children’s Fitness Tax credit: For 2016, claim up to $500 eligible fees for your child’s prescribed program of physical activity.
    • Children’s Art Tax Credit: For 2016 claim up to $250 eligible fees for your child’s prescribed program of artistic, cultural, recreational or developmental activity.
    • Home Accessibility Tax Credit: For 2017 and subsequent tax years, you can claim a non-refundable tax credit for eligible expenses incurred for work performed for a qualifying renovation of eligible dwelling of a qualifying individual.
    • Reporting the Sale of Your Principal Residence: Starting 2016, you are required to report basic information on your tax return when you sell your principal residence to claim the full principal residence exemption.

If you have any questions, please contact us and we can connect you with a tax professional.

Continue Reading