Changes to Corporate Income-Splitting Rules Could Hurt Women and Families

Finance Canada’s controversial proposals on the taxation of private corporations, which require comments on the changes by October 2, will potentially affect business people of all income levels, from all walks of life, who serve and employ Canadians in their hometowns across Canada. However, they will also affect families and, in particular, women. According to the background information accompanying the proposals, entrepreneurship is alive and well in Canada. The number of incorporated self-employed individuals almost doubled between 2000 and 2016. […]

7 Factors for Classifying Your Side-Gig Income with the CRA

About 32 per cent of workers are starting their own businesses on the side for a variety of reasons — including 25 per cent of those who earn more than $75,000 and 19 per cent of those with income over $100,000. For tax purposes, it’s critical to know the difference between someone who is employed and someone who is considered self-employed. The research conducted in the U.S. by CareerBuilder.com also confirms that self-employment is embraced more frequently by women and […]

New Canadian Tax Reforms Fail to Address Modern Challenges

Just how much is too much tax? For whom? In case you missed it, Canada is in the midst of a contentious tax reform that increasingly advocates the defeated reforms of yester-year. It seems governments think a “buck is a buck” for tax purposes again. But taxpayers who find themselves under siege — investors in small business in particular — say, it just isn’t so. Here’s why. Back in 1962, Prime Minister John Diefenbaker initiated the Royal Commission on Taxation, […]

Do Passive Investments in a CCPC Still Make Sense?

The federal government is on the hunt for new tax revenue from Canada’s small businesses, mainly because of an erosion of the personal tax base and a significant shift of taxable income to the corporate tax base instead. Specifically, the amount of taxable passive investment income earned by private corporations has increased from $8.6 Billion in 2002 to $26.8 Billion in 2015. And the government wants a bigger piece of that pie. The view is that because small business tax […]

Should You Take Your CPP Early or Late?

Are you thinking about retiring soon? One important consideration in this process is whether you should start your Canada Pension Plan benefits early or late. Now that tax season is over for most people (proprietors have until June 15 to file their returns), this is a question tax specialists and their pre-retiring clients should be discussing sooner rather than later. In fact, anticipating the after-tax consequences of this decision can help spur on broader retirement planning activities. Planning tips to […]

Claim More for Your Child Care Expenses

Post-tax season blues? Not sure if you claimed all the deductions and credits you were entitled to? You’re probably not alone. Many people miss lucrative provisions when filing, but you can request an adjustment to your filed return. One of the most frequently missed deductions for families is the child care expense claim. Parents who claim child care expenses will be happy to know they can claim qualifying expenditures as a deduction. Also, those claims could, in fact, increase the […]

Universal Child Care Benefits Are Subject to Tax for The Last Time

There are a number of omissions that can occur in the rush at the end of tax season. One of them is missing the reporting of income benefits received by families in 2016. It’s important to remember that for the first six months of 2016 the UCCB (Universal Child Care Benefits) were received and they are taxable. That’s a double whammy for many upper-middle-income families who also lost the family income-splitting provisions. There are now no child tax supports at […]

Manitoba Budget Hints at Tax Reform

Manitobans were spared tax increases in the April 11, 2017, budget, but the breadth of change to its complicated and voluminous tax credit structure hints at more tax reforms to come. In a province where 134,000 top earners pay 58% of all personal income taxes, the best news was that the government did not introduce any high-income surtaxes and appeared to be on track to drop 1% of the sales tax by 2020. The worst news was handed to graduates […]

2017 Tax Convictions by CRA Reap Big Penalties and Jail for Some

CRA has been busy announcing new convictions at the start of 2017, a great deterrent for potential tax evaders at the start of tax season. It’s always best to come forward to declare shortfalls in income reporting or overstatements of tax deductions or credits to avoid expensive interest, penalties and potential jail time. Here’s what happened to those who didn’t. . . Here’s what happened to Canada’s most recent tax evaders, as per CRA’s news releases: Vancouver, BC, February 28, […]

CRA Starts Tracking Tax Cheats by Fingerprinting April 1, 2017

It’s no April Fool’s joke: fingerprints of convicted tax cheats will be recorded in the Canadian Police Information Database (CPID), and accessible by Canadian police and border guards as well as some foreign agencies including the US Homeland Security department starting April 1, 2017. The mandatory fingerprinting policy was first reported by the CBC, which uncovered the directives under the Access to Information Act, and Moneysense Magazine. Both reports refer to an internal CRA memo on the matter as well […]