Many people have heard of the idea of becoming non-resident for Canadian tax purposes. Since the Canadian tax system is based on your residency becoming a non-resident means avoiding Canadian taxes in most, but not all, situations. This blog does not address the steps needed to make yourself non-resident if you are currently a resident of Canada, but rather focuses on potential tax liability of non-residents in Canada.
Most Overlooked tax breaks
I recently gave an interview to the CBC regarding tax breaks that I have frequently seen missed by Canadians over the years. You can see the whole article here, which also includes useful tips from well-known financial author Evelyn Jacks.
Keep watching the CBC site for my next interview regarding income splitting opportunities.
Incorporated? – T4/T5 deadline looms – Are you ready?
If you have an incorporated business and pay yourself, family members or other employees a wage or dividends from your company then your company is required to file a Tslip information return to the CRA by no later than February 28th each year to report these payments. Slips must also be issued to recipients by this date or are also subject to penalty. Penalties can be significant for failure to do so. Continue reading →
Spousal Loans – How do they work?
Spousal loans can work great in certain tax situations to shift investment income from a higher taxed spouse to a lower taxed one while also avoiding triggering the infamous “attribution rules” in the Income Tax Act. This can result in significant tax savings that compound from year to year. Continue reading →
Private Health Services Plan for Incorporated Professionals and Small Businesses
A private health services plan (PHSP) can be a great vehicle for small business owners and incorporated professionals. What is a PHSP? Simply put it is like having your own extended health plan, allowing your company to pay for and deduct your own personal medical costs, and payments do not even count as taxable benefits for you (or your spouse and family) as an employee of your company. Continue reading →
It’s All About the Relationship
Someone asked me the other day what it was that made me want to be an accountant. It got me to thinking, and I finally said it was the relationships. I believe that to be a good accountant it is important to have strong relationships with all your clients. It is this process of developing a relationship with a client that I find very satisfying.
People change, goals change, economic circumstances change but your relationship with your accountant should remain strong and you should feel comfortable asking questions about your changing life or business situations. You should also trust that your accountant will give you the straight goods about any financial issue you face. Trust is the cornerstone of any good relationship and accounting is no different.
Corporate/Professional year end tax planning
If you are an incorporated professional in Victoria or an incorporated businessperson have you considered your year end tax planning with your tax advisor?
Things to be considering include: Continue reading →
Moving expenses – a primer
Have you recently moved to Victoria or Oak Bay? Will you be earning income in Victoria from employment or a business? Have you moved at least 40 km closer to your new place of employment? If you answered yes to all of these questions then you may be eligible to deduct many of your costs of moving, including some costs of selling your former residence, actual moving costs paid to movers, renting trucks etc… as well as many other qualifying expenses.
Generally the move must be from one point in Canada to another point in Canada but moves outside the country may qualify if you are a deemed or factual resident of Canada.
If you do not generate sufficient income at the new location to use all your moving expenses, then the unused portion may be carried forward to apply against future years income from employment or self-employment. Investment income and employment insurance earnings are examples of two types of income that cannot be used with moving expenses.
Moving expenses are claimed when you file your personal tax return using a special form T1-M.
This is also a category of expense that is frequently reviewed by CRA so be sure to keep all your receipts and invoices to support your claim.
Not all expenses that you may think will qualify and many you may not think of will qualify. Consult your tax professional for assistance if you find yourself in this situation.
Year end Donation time – Be careful with donation schemes
For many people as year end approaches so does the planning for this year’s donations. From a tax perspective donating later in the year makes sense, because it minimizes the time from when you make the donation to when you get to claim the credit on your tax return, and recover part of your donation from the government. This can be especially important for larger donations when cash flow impacts need to be carefully considered. Continue reading →
2010 Personal Tax Tips
It’s starting to be that time to consider your 2010 personal tax returns.
Here are some of the key changes from the 2010 Federal Budget to be on the lookout for when considering your own situation. Continue reading →
