I have prepared a summary outlining what income sprinkling is and how it impacts the taxation of individuals in Canada and in particular Ontario. I am hopeful that this documents will be useful to you in understanding the issues and help separate fact from fiction that is currently being reported in the media.
We have been provided with the following letter template that may be of assistance to you if you are interested in providing your thoughts to your Member of Parliament regarding the proposed changes to the Income Tax Act released on July 18, 2017.
The proposed changes will impact the ability to share income of a family business and significantly increase the personal income tax rate on income from a private corporation. The ability to transition a business among families in a tax efficient manner including impacting the ability to claim the lifetime capital gains exemption is also impacted.
Further details of the changes can be found in our previous blog entry;
or in the Tax Tips & Traps Third Quarter – Issue 119;
Tax For Private Corporations: Major Changes Proposed
Employee Discounts On Merchandise: Change in CRA Policy
Death Benefits: Tax-Free Employment Benefit
Retirement Income Calculator: Ensure you are Financially Ready
Return of a Gifted Property: Charitable Organizations Beware
Voluntary Disclosure Program: Proposed Tightening
Withholdings On Remuneration To Non-Resident: Get your CRA Filings Correct
Professional’s Work In Progress Exclusion: Changes are Coming
Electronic T4 Slips: Now More Widely Available
On July 18, 2017 Minister of Finance William Morneau released proposed changes to the Income Tax Act impacting virtually all Private Corporations. The attached document highlights these proposed changes.
Employment Insurance: Some Improvements
Sharing Economy: Know Your Tax Obligations
Uber Drivers: Registration for GST/HST
Personal Use Asset in a Corporation: GST/HST and Other Tax Issues
Donation of Publicly Traded Securities: Increase the Value of Charitable Giving
Investment Management Fees for RRSPs, RRIFs, and TFSAs: Are Changes Coming?
Website History: Finding What You Thought Was Lost on the Internet
Charities and For-Profits Working Together: Receipts for Cause-Related Marketing
Leave of Absence: There Are Tax Obligations
Tax Highlights of the 2017 Federal Budget Commentary Include:
A. Personal Income Tax
B. Business Income Tax
C. International Tax
D. Sales and Excise Tax
E. Other Measures
F. Previously Announced Measures
Read the full article below.
Principal Residence Exemption (PRE): Changes to Reporting
Employment Expenses: Requirements for Deduction
Meal Reimbursements: A Taxable Benefit?
Taxpayer Relief: Financial Hardship
Payroll Advances: Tax Consequence
Objections: Not so Fast
CRA Strategies on Offshore Tax Evasion: The World is Shrinking
2016 Year End Planning
2016 Personal Income Tax Checklist
If you sell your home, there is new income tax reporting to consider.
Under current income tax rules, when you sell your home for a profit there is no income tax and there is nothing reported in your income tax return for the year of sale assuming your home qualifies as a principal residence.
Beginning with the 2016 tax year under new proposed income tax measures, the Canada Revenue Agency will require a taxpayer to report the disposition of property that qualifies for the principal residence exemption.
The year of acquisition, proceeds of disposition and the description of the property are the information that will have to be reported. We will need this information in order to prepare your income tax return.
Further information can be found on the Canada Revenue Agency website as follows.
Other changes have been made to the principal residence exemption that would impact non-residents and trusts, however in general terms the good news is that in a situation where an individual (or couple) who were at all times resident in Canada own one or more residences there has been no additional income tax levied.
Where an individual (or a couple) owns more than one residence, such as a city home and a cottage, income tax continues to apply on any gain realized on the disposition of a property not designated as a principal residence. An individual (or a couple) can only designate one residence as their principal residence.
Should you have questions do not hesitate to contact you trusted advisor at Graham Scott Enns.
|Open House In Memory
Of Don Lemon
November 9, 2016
Don Lemon touched the lives of many in the community, and with his sudden passing in August, many of us did not have an opportunity to reflect on Don’s life, and share memories with others.
The partners at Graham Scott Enns, with support from the CASO Station, have arranged for a celebration of Don’s life on November 9, which we hope you can join us for.
There is no charge for the tickets for the evening, however any sponsorships or donations received will be added to a contribution being made by Graham Scott Enns towards a memorial scholarship fund in Don’s name, to be directed to assist students from Central Elgin Collegiate Institute (where Don attended) who are graduating into business or accounting programs. Depending on the level of funds raised, the scholarship may be extended to other secondary schools in the city.
Please RSVP to let us know whether you will be able to attend.
|Wednesday November 9, 2016
5:30pm to 8:00pm
750 Talbot St, St. Thomas
email@example.com or 519-633-0700 ext 212