Unreported Capital Trades Included on a T5008: CRA Policy

Traders or dealers in securities must report to CRA the disposition of securities, such as publicly traded shares, mutual fund units, bonds and T-bills, of their clients on a T5008. A November 4, 2022 French Federal Court case summarized CRA’s administrative policy where a taxpayer has not filed a tax return, but a T5008 was issued, reporting the disposition of property that does not include the cost of the property disposed. In this case, CRA…

Post published:June 9, 2023
Post category:Personal Taxes Special Interest

TFSA: Carrying on a Business Within It

Earnings in a TFSA are typically not taxable. However, earnings in a TFSA become taxable when they are earned from carrying on a securities trading business. In a February 6, 2023 Tax Court of Canada case, CRA had assessed the TFSA on the basis that it was carrying on a business and was therefore taxable on its income for the 2009 through 2012 taxation years. The TFSA holder was a professional investment advisor who had…

Post published:June 2, 2023
Post category:Tax Planning

Underused Housing Tax (UHT): Increased Disclosures and Taxes

UHT is a 1% federal tax intended to apply to the value of vacant or underused residential real property owned by non-resident non-Canadians. However, many Canadian individuals and other entities are also required to file UHT returns and may even be liable for the tax. Numerous exemptions from the tax itself exist, but significant penalties can apply where the required return is not filed, even if no tax is payable. UHT was first applicable to…

Post published:May 26, 2023
Post category:Individual – Taxes Personal Taxes Special Interest Tax Planning

Budget 2023: Top Five Items for Owner-Managers

Budget 2023 (A Made-in-Canada Plan: Strong Middle Class, Affordable Economy, Healthy Future) was introduced in the House of Commons on March 28, 2023. The top five changes that may impact individuals and owner-managed businesses are as follows: Dental plan – The Canadian Dental Care Plan would be introduced to provide coverage for all uninsured Canadians with an annual family income of less than $90,000 (the previous Canada Dental Benefit only provided benefits for children under…

Post published:May 18, 2023
Post category:Business – Taxes Corporate Taxes Personal Taxes Tax Planning

One-Time Top-Up to The Canada Housing Benefit: Additional Support

A one-time tax-free payment of $500, announced in September 2022, is now available to low-income renters. The payment does not reduce other federal income-tested benefits. Eligible individuals must: be 15 years of age or older on December 1, 2022; be resident in Canada for tax purposes in 2022; have filed their 2021 tax return with adjusted net income below $35,000 for families or $20,000 for individuals. If the individual has a spouse or common-law partner,…

Post published:March 10, 2023
Post category:Business – Taxes Individual – Taxes Personal Taxes Special Interest

Use Government Money for Your Child's Education

Canada Dental Benefit: Support for those with Young Children

The Canada dental benefit, announced in September 2022, provides up-front tax-free payments to cover dental expenses for children under age 12 without dental coverage. The program began December 1, 2022, with expenses retroactive to October 1, 2022 being covered. The program is available for two periods: December 1, 2022 to June 30, 2023, and July 1, 2023 to June 30, 2024. While the program expires in mid-2024, the government has stated that it is committed…

Post published:February 17, 2023
Post category:Covid Tax Planning

Witnesses For Legal Documents: Choose them Wisely

A June 17, 2022 Ontario Superior Court of Justice case considered whether a will had been appropriately witnessed. In 2020, the owner of an insurance agency was diagnosed with terminal cancer and drafted a final will and testament. As it was the height of the COVID-19 pandemic, she chose two of her employees to meet her outside of the agency to sign the document as witnesses. She left everything to two children and nothing to…

Post published:February 10, 2023
Post category:Special Interest Wills

Employee Gifts and Parking: Updated CRA Policies

CRA updated several administrative policies in respect of employment benefits, effective January 1, 2022. Two of the key changes relate to employee gifts and parking. These updates were released in late 2022. Gifts, awards and long-service awards Under CRA’s existing gifts and awards administrative policy, the first $500 of annual gifts and awards provided to arm’s length employees is non-taxable. This policy does not apply to cash or near-cash gifts. Historically, CRA had considered all…

Post published:February 3, 2023
Post category:Tax Planning

Photo: Petru Mateas (Pexels)

Unreported Real Estate Dispositions: Multiple Issues

A September 12, 2022 Tax Court of Canada case reviewed the gain on a residential property purchased in 2007 and disposed of in 2011. The property was substantially rebuilt during the ownership period. The proceeds, cost and gain were all determined by CRA as the sale was unreported. These amounts were largely unchallenged by the taxpayer and accepted by the Court. The Court noted that the taxpayer’s tumultuous relations with her ex-husband, whom she divorced…

Post published:January 26, 2023
Post category:Individual – Taxes Special Interest Tax Planning

Covid Benefits: Review / Audit Activity

Covid Benefits: Review/Audit Activity On December 6, 2022, the Auditor General of Canada released its report on COVID benefit compliance enforcement. The report reviewed a total of $210.7 billion in payments with the following breakdown among programs. Canada Worker Lockdown Benefit (CWLB) – $0.9 billion Canada Emergency Wage Subsidy (CEWS) – $100.7 billion Canada Recovery Sickness Benefit (CRSB) – $1.5 billion Canada Recovery Childcare Benefit (CRCB) – $4.4 billion Canada Recovery Benefit (CRB) – $28.4 billion Canada Emergency Response Benefit (CERB) and related EI program – $74.8 billion…

Post published:January 20, 2023
Post category:Tax Planning

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