There has been much discussion in recent months of tax avoidance and evasion. The March 2013 Federal Budget proposes to introduce the Stop International Tax Evasion Program, which would reward individuals (up to 15% of federal tax collected) who provide tips on significant international tax non-compliance leading to collection of outstanding federal taxes in excess of $100,000.
Discretionary shares are a popular income-splitting tool for professional corporations and owner-managed corporations. They have gained popularity since the Neuman decision from the Supreme Court of Canada in 1998 (Melville Neuman v. Her Majesty the Queen). Not surprisingly, the Canada Revenue Agency (CRA) is still looking for ways to attack the use of discretionary shares.
For small businesses (generally businesses with annual sales of less than $4 million), the CRA has implemented a new audit approach whereby, instead of combined income tax and GST/HST audits, the agency will conduct separate audits. In our experience, the CRA’s increased focus has prompted auditors to focus on GST/HST issues previously overlooked during the combined tax audits era.
On April 1, 2013, the following will take place: British Columbia will replace its 12% HST with a combination of the 5% GST and the province’s 7% PST; and Prince Edward Island will implement the HST at 14%, replacing the 5% GST and the province’s 10% PST.
The T106 Summary and corresponding Slips (collectively, the T106 Form) represent the annual information return used to report non-arm’s length transactions between reporting persons or partnerships and non-residents, in accordance with section 233.1 of the Income Tax Act.
While many U.S. citizens living in Canada have recently become aware of the requirement to file annual U.S. individual income tax returns, they may not be aware of the specific filing requirements in regard to certain registered investment plans held in Canada.
On January 1, 2013, the long-anticipated American Taxpayer Relief Act of 2012, commonly known as the Fiscal Cliff Legislation (FCL), was passed into law. The FCL addressed looming reversions to old tax rules that could have affected up to 98% of American taxpayers.
At some point in the lives of most individuals and business enterprises, loan interest becomes a significant annual expenditure. Not surprisingly, its deductibility in computing income has been the subject of many disputes between taxpayers and the Canada Revenue Agency (CRA).
With final regulations recently coming into force, the framework for pooled registered pension plans (PRPPs) is now complete.
It’s the most wonderful time of the year! That’s right, time to start your year-end tax planning so any strategies that need to be implemented before key dates in order to be effective can be successfully launched.