Davidow & Nelson Blog

Taxable?: BENEFITS PAID TO SHAREHOLDER EMPLOYEES

The CRA is aware that owner-managers have an incentive to receive benefits deductible by their corporation which are non-taxable to the owner. In essence, this can be perceived as a method to extract profits out of a corporation without paying tax on it. As such, CRA is particularly vigilant to ensure that these benefits comply… Read more »

How Do I Compare?: CANADIAN INDUSTRY STATISTICS

The Government of Canada provides analysis and detailed information on economic indicators using the most recent data from Statistics Canada on the website, www.ic.gc.ca/eic/site/cis-sic.nsf/eng/home. This website can help small to medium sized businesses understand the dynamics of their industries. Users can focus on a single industry over time or compare one industry against another. Data… Read more »

TAX TICKLERS… some quick points to consider…

• Timing and amounts of various payments and benefits, such as the Canada Child Benefit, can be obtained by calling the CRA’s TIPS line at 1-800-267-6999. • In the summer of 2016, CRA commenced a project to examine taxpayers holding expensive properties in Vancouver where only low amounts of income were reported. The goal of… Read more »

Related Employee: INSURABLE EARNINGS

Consider the situation where Persons A and B are a married couple and own 60% and 40% respectively of Corporation A (A Co.). They are also both employed by A Co. and, therefore, receive a salary. Will the salaries that they receive be considered insurable for Employment Insurance (EI) purposes? That is, would EI withholdings… Read more »

2016 REMUNERATION

Higher levels of personal income are taxed at higher personal rates, while lower levels are taxed at lower rates. Therefore, individuals may want to, where possible, adjust income out of high income years and into low income years. This is particularly useful if the taxpayer is expecting a large fluctuation in income, due to, for… Read more »

Year End Tax Planning

December 31, 2016 is fast approaching… see below for a list of tax planning considerations. Please contact us for further details or to discuss whether these may apply to your tax situation. SOME 2016 YEAR-END TAX PLANNING TIPS INCLUDE: 1) Certain expenditures made by individuals by December 31, 2016 will be eligible for 2016 tax… Read more »

My Account Update: CRA ONLINE SERVICES

In early 2016, CRA updated the “My Account” online service (intended for the individual taxpayer’s exclusive use). This service allows individuals to: • view CRA correspondence, assessments, and balances; • view some income slips for the current and previous years (T4, T5, T3, etc.); • view certain personal limits like RRSP and TFSA contribution room… Read more »

Do You Have the Best Card for Your Needs?: CREDIT CARD COMPARISON

Rate Hub provides an array of calculators and tools at www.ratehub.ca/credit-cards to help individuals and businesses select the most appropriate credit card for their needs. In particular, the tools quantify the dollar value of benefits (such as sign-up bonuses and annual spend rewards) and costs (such as annual fees). These tools can also factor in… Read more »

Shareholders’ Personal Information: COMBINED AUDITS OF OWNER-MANAGED COMPANIES

In a June 18, 2015 Technical Interpretation, CRA was asked about the perceived increase in requests of personal financial information of the shareholders of Canadian corporations selected for audit. Further, questions were asked with respect to information that is requested in relation to the shareholder’s spouse, children or other related parties. In some situations, the… Read more »

Significant Changes Ahead: MULTIPLICATION OF THE SMALL BUSINESS DEDUCTION (SBD)

Measures were proposed in the 2016 Federal Budget to prevent certain corporations from multiplying access to the $500,000 SBD. Some proposals include: • Eliminating multiplication of the SBD in “complex partnership structures” where payments are sent from a partnership to non-partner corporations owned by partners, or those related to partners. Broadly speaking, this planning structure… Read more »