Recent Publications

Recent Publications

September 17, 2018 by Tony Alberton

Don’t dive into the shallow end of the TOSI income pool

In recent Tax Alerts we discussed the tax on split income (TOSI), which limits income-splitting techniques involving private corporations by taxing amounts received at the highest marginal tax rate. The rules are complex and, to date, the Canada Revenue Agency (CRA) has provided only limited guidance on their application.

August 30, 2018 by Bill Crowther

Tax-deferred capital distributions from discretionary family trusts

Discretionary family trusts are used extensively for tax, family and succession planning, as they afford enormous flexibility. In most cases, when such trusts are created, beneficiaries do not pay for their interest, and this assumption is made herein. Once a trust is settled, it will exist until all the assets are distributed to the beneficiaries and the trust is wound up. 

July 30, 2018 by Bob Boser

Avoiding and Getting Off of The TOSI Highway

On July 18, 2017 the Federal Finance Minister announced proposals to change the tax rules related to income splitting using private corporations. The original proposals were subsequently withdrawn in October, re-released in December and after further changes the proposed legislation was included in Bill C-74 in March 2018. Bill C-74 received Royal Assent on June 21, 2018 and the new tax on split income (TOSI) rules are now in effect as of the beginning of 2018.

July 11, 2018 by Chris Russell

Business valuations 101 – Redundant assets: to be, or not to be?

There are numerous components that go into valuing the assets of an active business. In simplified terms, those components can be characterized as the value of normalized discretionary cash flow plus redundant assets. In this article, we will be discussing two of the more common redundant assets that business owners frequently do not realize exist within their organization.

June 28, 2018 by Catherine Rau, Scott Dupuis

Managing adjusted aggregate investment income

As outlined in the March Tax Alert, the 2018 Budget includes a measure designed to slow the accumulation of passive investments within active corporations. This measure is based on a calculation that considers both the amount and the type of investment income earned in a corporation. Understanding this calculation will guide an investor in developing a tax-efficient investment strategy going forward.

June 15, 2018 by Peter Hobb

Important issues in family succession of farm operations

When planning for the succession of your farm operation to the next generation, several important issues can arise. Some of the key issues include how the goals and objectives of key stakeholders align with your goals, how you will be spending your time in retirement, ensuring you have adequate financial resources in retirement and how to divide assets among your children, some of whom may not wish to be involved in the farm operation. There are many issues, and they will vary depending on your particular circumstances.

June 11, 2018 by Heather Milburn

Approaching process improvement

Our lives and the world around us are in a constant state of change. Why then, do so many organizations struggle to make time for continuous process improvement? There are a lot of programs and tools out there – including Six Sigma, Lean, Kanban, 5 S’s, Kaizen and TQM – so it is easy to get overwhelmed. However, you do not need your staff to have months of training to enjoy the benefits of continuous improvement. While many organizations have reaped the benefits of in-house continuous improvement programs, a great deal can be gained from a quick and easy review process.

May 16, 2018 by Ben Berci

Updated Voluntary Disclosures Program

Audits and assessments undertaken by the Canada Revenue Agency (CRA) that uncover errors or omissions by a taxpayer can lead to significant penalties. These penalties can range from a percentage of unpaid taxes to fixed monthly penalties, up to $2,500 per incident, in the case of late-filed information forms. In severe cases, criminal charges and jail time could result.

May 1, 2018 by Gerry Riskin

The immutable laws of law firm success

When Edge International was formed, I was optimistic that by this century we could all make the following statement – and it would be true:

Dateline 21st Century: Most professional firms today and their practice groups are led by individuals who have not only mastered practice skills but are equally adept in organizational behaviour. They understand group dynamics and the art of facilitation. They conduct highly effective meetings, coach individuals to achieve their personal best performances, and create an environment in which professionals thrive[...]

April 24, 2018 by Mario Patenaude, Tammie M. Sorensen

Preventing labour code changes from killing your business

It is clear to business leaders, either motivated by profit or not, that government and its legislation will continue to make it increasingly challenging to run a profitable or financially viable not-for-profit venture. These legislative changes, most recently dealing with taxation and labour, will negatively impact the bottom line.

April 13, 2018 by Sameer Noormohamed

New QST registration requirements for non-resident suppliers

On March 27, 2018, the Quebec budget introduced a specified registration system for Quebec Sales Tax (QST) purposes for non-resident suppliers that make taxable supplies through e-commerce channels to recipients located in Quebec.

March 28, 2018 by Tom Hunt

Further elimination of the small business tax deferral

After months of speculation regarding the taxation of passive investment income earned by private corporations, the Minister of Finance tabled Budget 2018 on February 27, 2018. The budget includes a measure to further limit the small business deduction as a result of a perceived tax deferral advantage when passive investment income is earned inside private corporations.

March 14, 2018 by Martha MacRae, Todd King

U.S. Tax Reform Punishes U.S. Citizens Abroad

From a taxation perspective, the period from July 2017 to February 2018 has been one of the most tumultuous in recent history for Canadian private company owners. For those who also have the privilege of being U.S. citizens or resident aliens, things have gotten downright ludicrous. In a rush to pass into law the most sweeping tax reform in a generation, U.S. lawmakers have stuck U.S. citizens resident in Canada with retroactive, double taxation, the elimination of much of the tax deferral previously available in their companies, a looming April 17th payment deadline and virtually no rules or regulations to guide them through the chaos.

March 13, 2018 by Sean Kelly, Jason Melo

Should you be registered for Canadian GST/HST?

Foreign companies, individuals and organizations who provide goods and services to customers in Canada should consider whether their business activities in Canada invoke a requirement to register for the Goods and Services Tax / Harmonized Sales Tax (GST/HST). 

March 2, 2018 by Denver Nicklas

The capital gains exemption: beware of in-law quirks

In Canada, qualified farmland can be transferred from one generation to the next for any dollar amount between cost and fair market value (FMV) at the time of the transfer. Any capital gain triggered by the transfer is covered by the capital gains exemption (up to $1,000,000 for farmland), assuming the land is qualified farm property.