2023 Year-End Tax Planning
December 31, 2023 is fast approaching. See below for a list of tax planning considerations. Please contact us for further details or to discuss whether these may apply to your tax situation.
2023 Remuneration
Higher personal income levels are taxed at higher personal rates, while lower levels are taxed at lower rates. Therefore, individuals may want to, where possible, adjust income out of high-income years and into low-income years. This is particularly useful if the taxpayer is expecting a large fluctuation in income due to, for example, an impending: maternity/paternity leave; large bonus/dividend; or sale of a company or investment assets. In addition to increases in marginal tax rates,…
Clothing Drive 2023
Thank you for the support for our 2023 Clothing Drive. It was a huge success! This year we supported the Anawim Houses for men and women and the Justice Van Society. We received much needed clothing and warm items. We couldn't have done this without your donations and the support of our volunteer drivers who took the items to the charities! We can't thank you enough for your generosity of time. These donations are distributed…
Multigenerational Home Renovation Tax Credit: More Housing Support
The multigenerational home renovation tax credit is a refundable tax credit applicable to the costs of constructing a secondary suite for an eligible person (generally a relative either age 65 or over, or eligible for the disability tax credit) to live with a qualifying relation. The tax credit is available on up to $50,000 of eligible expenditures incurred after 2022 at a rate of 15%. In a March 6, 2023 Technical Interpretation, CRA confirmed that the eligible person must ordinarily inhabit, or be intended to ordinarily inhabit,…
Cryptocurrency Exchange Cessation: Recordkeeping
A June 7, 2023 CryptoTaxLawyer.com article (Binance Bids Canada Bye-Bye! Canadian Tax Implications for Cryptocurrency Investors and Traders) reminded Canadians about the importance of maintaining an offline record of transactions as exchanges, such as Binance, shut down in Canada. On May 12, 2023, Binance announced that Canadian users will be required to close any open positions by September 30, 2023. Once the exchange is closed to Canadians, there is the possibility that access to records…
First Home Savings Account (FHSA): A New Investment Tool
The tax-free FHSA was introduced in 2023 to help first-time home buyers save up to $40,000 for a home purchase. Individuals eligible to open an FHSA must be at least 18 years of age and resident in Canada. The individual must also have not lived in a home that they or their spouse owned jointly or otherwise at any time in the year or the preceding four calendar years. Contributions to an FHSA are deductible…
CPP Enhancements: Higher Contributions and Higher Benefits
In 2019, the government commenced a two-part enhancement to the Canada Pension Plan (CPP), with full implementation to be completed in 2025. Phase 1 occurred from 2019-2023; phase 2 will occur from 2024-2025. Overall, the changes will require larger contributions but also will provide larger benefits. Pre-CPP enhancement CPP contributions for employees and employers under the pre-enhancement CPP model (referred to as base contributions) were calculated as 4.95% of the employee’s pensionable earnings to a…
Employee Time Theft: Some Challenges
A January 11, 2023 BC Civil Resolution Tribunal case addressed a claim for wrongful dismissal. The employer filed a counterclaim in respect of a 50-hour discrepancy between the employee’s timesheets and tracking software data over a period of about a month during which the employee was working remotely. The employee argued that significant hours were spent working from hard copies; however, this was rebutted by records of printer usage and a lack of evidence of…
Small Business Succession: Many Business Transfers Coming Shortly
The Canadian Federation of Independent Businesses (CFIB) released a report on January 10, 2023, focused on succession expectations for small businesses. It included the following survey responses: 76% of small business owners (constituting $2 trillion in business value) are planning to exit their business in the next 10 years; 9% have a formal business succession plan in place; obstacles to succession planning include: finding a suitable buyer (54%), business valuation (43%), and over-reliance of owner…
Employment Expenses for Commissioned Employee: Sponsorship
In a January 23, 2023 French Court of Quebec case, a commissioned salesperson deducted nearly $600,000 over2015 and 2016, in sponsorship expenses of a professional cycling team in Canada. The individual was an investment advisor and reported commission income of $1,493,910 and $1,263,360 and taxable capital gains of $2,276,374 and $99,767 in the respective years. The taxpayer argued that the sponsorship promoted his services as an investment advisor. As the main sponsor of the cycling…