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For most of the year, taxpayers live quite happily without any contact with the Canada Revenue Agency (CRA). During and just following tax filing season, however, such contact is routine – tax returns must be filed, Notices of Assessment are received from the CRA and, on occasion, the CRA will contact a taxpayer seeking clarification of income amounts reported or documentation of  deductions or credits claimed on the annual return. Consequently, it wouldn’t necessarily strike taxpayers as unusual to be contacted by the CRA with a message that a tax amount is owed or, more happily, that the taxpayer is owed a refund by the Agency. Consequently, it’s the perfect time for scam artists posing as representatives of the CRA to seize the opportunity to defraud taxpayers.


By the end of June all individual taxpayers have filed their 2015 income tax returns and most will have received a Notice of Assessment outlining the Canada Revenue Agency’s (CRA’s) conclusions with respect to that taxpayer’s income and tax position for the year. In most cases, the Notice of Assessment won’t vary a great deal from the information provided by the taxpayer in his or her return. Where it does, and the change is to the taxpayer’s detriment, taxable income assessed is greater than the amount reported by the taxpayer, or a deduction or credit is denied, then the taxpayer has to decide whether to dispute the CRA’s assessment.


By now, most Canadians are familiar with the use and the benefits of a tax-free savings account (TFSA), which have proven to be a very popular savings vehicle since they were introduced in 2009. What’s proven to be harder to do is keeping track of one’s annual TFSA contribution limit. The annual TFSA contribution limit contribution allowed by law has been something of a moving target, subject to change after change by successive governments. As well, withdrawals made from a TFSA are added to one’s annual contribution limit, but not until the following taxation year – a fact that has escaped many TFSA holders and sometimes even their financial advisers. And finally, the Canada Revenue Agency (CRA) used to provide information on a taxpayer’s current year TFSA contribution limit on the annual Notice of Assessment, but that’s no longer the case, meaning that the taxpayer has to make an extra effort to obtain that information.


There has been much discussion in recent years about whether Canadians are adequately prepared for retirement and, more specifically, whether Canadians are saving enough to ensure a retirement free of undue financial stress. While the financial health of current and soon-to-be-retirees (essentially, the baby boomers) is a concern, the focus is more on the question of whether our current system is such that younger Canadians can expect to have some degree of financial security in retirement. The workplace has altered dramatically in the past quarter century and many of the retirement income options which were relied upon by previous generations – especially an employer-sponsored defined benefit pension plan – are all but unknown to private sector workers under the age of 30 or even 40.


By the time most Canadians sit down to organize their various tax slips and receipts and undertake to complete their tax return for 2015, the most significant opportunities to minimize the tax bill for the year are no longer available. Most such tax planning or saving strategies, in order to be effective for 2015, must have been implemented by the end of the calendar year. The major exception to that is, of course, the making of registered retirement savings plan (RRSP) contributions, but even that had to be done on or before February 29, 2016 in order to be deducted on the return for 2015.


Over the next academic and calendar year, post-secondary students will find that a number of changes are taking place with respect to the rules governing the financing side of post-secondary education. Some of those changes will be welcome, and others will not.


For even the most determined of procrastinators, the deadline for filing an individual income tax return for the 2015 tax year is imminent. That deadline will come on Monday May 2, 2016 for most Canadians, and on Wednesday June 15, 2016 for the self-employed and their spouses.


For several decades, Canadian families have received financial assistance from the federal government to help offset the cost of raising children, through a range of benefits and allowance programs. Those programs have taken a variety of forms, from direct payments to parents to credits provided on the annual tax return. Some amounts provided under some such programs were taxable, while others were not. The one constant throughout those decades is that such programs are in a continual state of change and revision, resulting in a sometimes confusing patchwork of entitlements.


There’s no denying that the Canadian tax system is complex, even for individuals with relatively straightforward tax and financial circumstances. As well, significant costs can follow if a taxpayer gets it wrong when filing the annual tax return. Sometimes those costs are measured in the amount of time needed to straighten out the consequences of mistakes made on the annual return; in a worst case scenario, they can involve financial costs in the form of interest charges or even penalties levied for a failure to remit taxes payable on time or in the right amount. Whatever the reason, fewer and fewer individuals are willing to brave the annual trip through the 488 lines of the federal tax return (plus seemingly innumerable related federal schedules and provincial tax forms), and that means that the percentage of Canadians who have their return prepared by someone who has, presumably, more expertise, has continued to rise.


Any taxpayer told of a strategy that offered the possibility of saving hundreds or thousands of dollars in tax and increasing his or her eligibility for government benefits while requiring no advance planning, no expenditure of funds, and almost no expenditure of time could be forgiven for thinking that what was proposed was an illegal tax scam. In fact, that description applies to pension income splitting which is a government-sanctioned strategy to allow married taxpayers over the age of 65 (or, in some cases, age 60) to minimize their combined tax bill by dividing their private pension income in a way which creates the best possible tax result.


For several years, the Canada Revenue Agency (CRA) has been seeking to convince Canadian taxpayers of the benefits of filing their annual tax return online, and it seems that their efforts have been successful. Last year, over 80% of Canadian taxpayers filed their returns by electronic means. The change has been a rapid one, as nearly 40% of tax filers filed a paper return in 2011, with that number dropping to less than 20% in 2015.


While filing a tax return is an annual event for just about every Canadian, the return that is filed, and sometimes the process of filing it, changes each year. Differences in the return itself arise from changes made in our tax laws, which occur on a regular basis. Changes to the filing process generally come about because of changes in the Canada Revenue Agency’s (CRA) administrative procedures, which themselves are usually the result of improvements in technology. The process of filing returns for 2015 includes both types of changes.


Two quarterly newsletters have been added—one dealing with personal issues, and one dealing with corporate issues.


The early months of the new calendar year can feel like a never-ending series of bills and other financial obligations. Credit card bills from holiday spending, or perhaps a mid-winter vacation, are due or coming due. The RRSP deadline of February 29, 2016 is approaching, and the May 2, 2016 deadline for payment of any final balance of 2015 income taxes owed is not far behind.


Millions of Canadians receive Old Age Security (OAS) benefits, meaning that millions of Canadians may be subject to the OAS “recovery tax” or, as it is more commonly referred to, the clawback. Unfortunately, very few Canadians are familiar with that tax or how it works, and even fewer incorporate the possibility of having to pay the tax into their retirement income planning. There are, however, strategies which allow taxpayers to minimize or avoid the OAS clawback in retirement.


Canadian taxpayers don’t need a calendar to know that the registered retirement savings plan (RRSP) contribution deadline is approaching — the glut of television, radio and internet ads which fill the airwaves and screens this time of year are reminder enough. And, while RRSP planning and retirement planning generally are best approached as an ongoing, year-round activity, it is true that an imminent deadline tends to focus the minds of taxpayers on such issues


As the time for the traditionally strong spring housing market approaches, the current state of Canadian real estate is on the minds of a lot of Canadians these days. It’s also a concern for Finance Canada, which has made a change to Canadian mortgage financing rules which will take effect on February 15, 2016, in time for that spring housing market.


Planning for 2016 taxes when the year has barely started and the filing deadline for 2015 returns is still months away may seem more than a little premature. Nonetheless, taking some time to review one’s tax situation—and perhaps putting a few strategies in place—at the beginning of the year can help avoid a cash flow crisis or other financial shock when the RRSP contribution deadline looms or it is tax filing (and tax payment) time in the spring of 2017. And, while many tax planning and tax saving strategies can be implemented throughout the tax year, getting an early start on such planning usually leads to the best results.


The Employment Insurance premium rate for 2016 is 1.88%.

Yearly maximum insurable earnings are set at $50,800, making the maximum employee premium $955.04.

As in previous years, employer premiums are 1.4 times the employee contribution. The maximum employer premium for 2016 is therefore $1337.06.


The Canada Pension Plan contribution rate for 2016 is unchanged at 4.95% of pensionable earnings for the year.


Dollar amounts on which individual non-refundable federal tax credits for 2016 are based, and the actual tax credit claimable, are contained herein.


The indexing factor for federal tax credits and brackets for 2016 is 1.3%. Contained herein are the federal tax rates and brackets will be in effect for individuals for the 2016 tax year.


Each new tax year brings with it a listing of tax payment and filing deadlines, as well as some changes with respect to tax planning strategies.


The Canadian income tax system, as it applies to individuals, operates on a calendar year basis. While there are a few exceptions (RRSP contributions and pension income splitting being the important ones), the general rule is that, in order to be effective for a particular taxation year, tax planning strategies must be implemented before the end of that year.


Old Age Security (or OAS) is one the two main components of Canada’s government-sponsored retirement income system—the other being the Canada Pension Plan (CPP). There are also federal and provincial supplements which are available to lower-income seniors. While many retired Canadians receive both OAS and CPP benefits every month, the two plans are quite different. The only determinants of the amount of Canada Pension Plan benefits receivable are one’s contribution amount and the age at which one elects to begin receiving benefits; other sources of available income or one’s overall income level are not considered. Eligibility for OAS, on the other hand, is based on Canadian residency. Essentially, a person aged 65 and older who has lived in Canada for at least forty years after the age of 18 is eligible for full OAS benefits. Where the length of Canadian residency after age 18 is less than forty years, a partial pension is earned at the rate of 1/40th of the full monthly pension for each full year lived in Canada. OAS benefits are fully indexed to inflation.


It seems not entirely in the spirit of the upcoming holidays to be talking about potential tax liability arising from holiday gifts. And it should be noted that, in the vast majority of cases, there are no tax consequences to such gifts. Where, however, gifts are provided by an employer to employees, unintended (and unwelcome) employee tax liability can be the result.


Generally speaking, and absent extraordinary circumstances, the federal government issues two major economic and fiscal documents each year. The first is the federal Budget, which is usually delivered in the late winter or early spring, and outlines the government’s plans and projections with respect to federal government revenues and expenditures for the upcoming (April 1 to March 31) fiscal year, along with any new tax measures which the government intends to implement. About halfway through the fiscal year, usually during month of October, the federal government releases its Economic and Fiscal Update. As the name implies, this release updates the information announced in the federal Budget, especially with respect to revenue and expense projections, the overall state of the Canadian economy, and whether a change is required to the surplus or deficit projection provided in the Budget for the current fiscal year.


Two quarterly newsletters have been added—one about personal issues, and one about corporate issues.


The Canadian tax system is a complex one, and while there are some deductions and credits—like RRSP contributions or charitable donations—which are familiar to just about every taxpayer, others are not so well known. One of those is the deduction which can be claimed by any taxpayer who must pay union dues or professional fees or professional liability insurance premiums.


Thousands of Canadians, usually retirees, spend some or all of the Canadian winter as far south of the border as possible, often in Florida or Arizona. While the declining value of the Canadian dollar has made such sojourns much more expensive, meaning that some vacation plans may have to be scaled back, many Canadians will be planning at least a short stay in a warmer place this winter.


One of the many changes resulting from developments in Canada’s economy over the past quarter century has been the need for, more or less, continuous learning. At one time, it was possible to set a career goal, acquire the necessary training or skills for that work and make a lifelong career in that field. It’s abundantly clear that that is no longer the reality for most Canadian workers, whatever their field of work.


Most Canadians are aware that the deadline for contributing to one’s registered retirement savings plan (RRSP) is 60 days after the calendar year end. Many also know that contributions to a tax-free savings account (TFSA) can be made at any time during the year. Consequently, when Canadians start thinking about year-end tax planning or saving strategies, RRSPs and TFSAs aren’t often top-of-mind. The fact is, however, that there are some situations in which planning strategies involving TFSAs and RRSPs have to be put in place by the end of the calendar year; some of those are outlined below.


As is reported in the news at least once a month, there doesn’t seem to be an end or a limit to the inexorable rise in Canadian house prices. While the cost of housing in Vancouver and Toronto outstrips prices everywhere else, even smaller metropolitan areas are posting record increases.


By the time the summer is over and everyone’s back to school and work, most taxpayers have completed and forgotten about their tax obligations for the year. Returns have been filed and Notices of Assessment have been received. Income tax refunds have been spent or saved, and any amount still owing for taxes has generally been paid. For the Canada Revenue Agency (CRA), however, taxes are a year-round business, and fall marks the move from one phase of its activities to another—specifically, to the start of its annual post-assessment tax return review process.


For several years the Canada Revenue Agency (CRA) has encouraged taxpayers to begin receiving payments from the Agency by means of direct deposit to their bank accounts, rather than by receiving cheques sent through the mail. By the spring of 2016, that second option will no longer be available.


Time and again, Canadians have shown that where there is a humanitarian crisis anywhere in the world, whether caused by a natural disaster or arising for reasons of politics or economics, they are prepared to extend a helping hand. In many such past instances, the federal government has indicated that it will augment the generosity of Canadians by matching donations which are made.


For most Canadians, having to pay for legal services is an infrequent occurrence, and most of us would like to keep it that way. In most instances, the need to seek out and obtain legal services (and to pay for them) is associated with life’s more unwelcome occurrences—a divorce, a death, or a job loss. About the only thing that mitigates the pain of paying legal fees (aside, hopefully, from a successful resolution of the problem that created the need for legal advice) would be being able to claim a tax credit or deduction for the fees paid.


The current election campaign has once again focused the attention of Canadians, especially the baby boomers, on changes announced in 2012 to Canada’s retirement income system. One of the results of those changes is that Canadians aged 65 and over can, as of July 1, 2013, choose to defer receipt of their Old Age Security (OAS) benefits. What’s more difficult is deciding, on an individual basis, whether it makes sense to defer receipt of those benefits and, if so, for how long.


A number of circumstances and developments have come together to make working from home an attractive prospect for both employers and employees. Soaring house prices in major Canadian cities have driven those who work in those cities further and further afield in the search for affordable housing. Consequently, there are increasing numbers of Canadians who must travel into a major urban centre for work each day, putting already crowded highways and city streets into near-gridlock much of the time. And the summer of 2015 has been more difficult than most for commuters. In addition to the usual delays caused by the summer construction schedule, special events held in major cities have closed or narrowed the usual commuter routes. Any commuter spending hours a day just trying to get to and from work might well wonder whether it’s worth it.


By this time of the year, most Canadian taxpayers have filed their returns for 2014 and received a Notice of Assessment with respect to those returns. Many will have received a refund, while others have received the unwelcome news that money is owed to the Canada Revenue Agency (CRA) and have paid up, however unwillingly.


Two quarterly newsletters have been added—one about personal issues, and one about corporate issues.


This month, millions of Canadians will receive unexpected mail from the Canada Revenue Agency (CRA). That mail will contain an unfamiliar form—a 2015 Instalment Reminder. On that form, the CRA suggests to the recipient that he or she should make instalment payments of income tax on September 15 and December 15 2015, and will identify the amount which should be paid on each date.


Earlier this year, it was announced that the annual contribution limit to tax-free savings accounts (TFSAs) would be nearly doubled, increasing from $5,500 to $10,000, and that that increase would be effective for the 2015 and subsequent tax years.


This summer, millions of Canadians have been affected by a series of disasters ranging from forest fires to droughts and other kinds of severe weather, and many of those Canadians have been temporarily displaced from their homes and businesses as a result.


In October 2014, the federal government announced a number of changes to tax and benefit programs affecting families with young children. One such change altered the Universal Child Care Benefit (UCCB) program, effective January 1, 2015, to increase the amount of that taxable benefit for families having children under the age of 6 and to create a new benefit for those with children aged 6 to 17. The first payment of the new or increased benefit was made in July, in the form of a lump sum payment representing the accrued benefits for the first half of 2015. Since then, this being an election year, there have been claims and counter-claims about the amount of the net benefit to Canadian families of the changes to the UCCB, and about the kind of tax planning families receiving that benefit need to undertake. The existing and new tax rules which determine the overall net benefit of the changes for Canadian families are as follows. 


While for elementary and secondary school students, the summer is just beginning, post-secondary students are already halfway through their summer break between school years. And, as summer starts winding down, these post-secondary students will start thinking about choosing courses and finding a place to live during the coming academic year. Their parents’ attention will more likely be focused on the cost of that year, and the upcoming deadlines for payment of first semester tuition and housing costs.


Canadians will go to the polls for the next federal election on October 19, 2015, and the campaign by all parties to win votes in that election is already on. And, while no two election campaigns are alike, either in the way they are run or the ultimate outcome, they all have one thing in common—money. It costs a great deal of money to run a national election campaign, and each party and candidate seeking election or re-election in October has been and will be seeking contributions from individual Canadians to help them finance their campaigns. The task of raising that money is made somewhat easier by the fact that Canadian taxpayers who donate money to political parties or candidates can claim a federal tax credit for those donations.


Conventional wisdom with respect to the cycle of income, debt, and savings over an individual’s lifetime is based on certain assumptions. Generally, it is assumed that Canadians in their 20s and 30s will see their financial affairs weighted far more heavily on the debt side of the equation, as they pay off student loans, buy a home (and take on a mortgage), and meet the financial demands of raising children while building a career. As those individuals move into their 40s and 50s, it’s assumed that the financial demands of raising that family will eventually decline and the mortgage will be paid off. As well, the two decades between 40 and 60 have traditionally been the peaking earning years and, as other financial obligations are reduced, some of those higher earnings can be redirected to saving for retirement. Ultimately, the cycle ends with retirement around the age of 60 or 65, with a paid-for home, no debt, and adequate savings for retirement.


Fraud isn’t and never has been a seasonal business—every day of the year, attempts are made to cheat individuals out of their hard-earned income or savings. There are, however, times of the year when some types of scams are more prevalent and tax scams flourish during tax filing season.


As the end of the school year draws closer, and with it the start of two months of summer holidays, families who don’t have a stay-at-home parent (and likely some who do) must start thinking about how to keep the kids supervised and busy throughout the summer months. There is no shortage of options—at this time of year, advertisements for summer activities and summer camps abound—but nearly all the available options have one thing in common, and that’s a price tag. Some choices, like day camps provided by the local recreation authority can be relatively inexpensive, while the cost of others, like summer-long residential camps or elite-level sports or arts camps, can run into the thousands of dollars.


Keeping up with reporting, remitting, and payment obligations for income taxes, goods and services, or harmonized sales tax and employee source deductions is a constant headache for many small business owners, who would rather be spending their time working to grow their businesses. Staying on top of such obligations is particularly challenging for new small business owners, to whom all such calculations, forms, and remittance deadlines represent new and unfamiliar territory.


By the second week of May 2015, the Canada Revenue Agency (CRA) had processed about 22 million individual income tax returns filed for the 2014 tax year. Just under two-thirds of those returns (about 64%) resulted in a refund to the taxpayer. About 14% of returns filed and processed required payment of a tax balance by the taxpayer. Just under 20% were what are called “nil” returns – returns where no tax is owing and no refund claimed and the taxpayer is filing in order to provide income information which will be used to determine his or her eligibility for tax credit payments (like the Canada Child Tax Benefit or the HST credit).


Most older Canadians would prefer to stay in their own homes for as long as possible—so-called “aging in place”. Staying in one’s own home throughout retirement has a number of strong points—a familiar environment in a familiar community and, most often, more privacy, independence, and autonomy. There are financial advantages, as well, to aging in place. Care provided in an assisted-living setting (whether a retirement home, a long-term care facility, or a nursing home) is expensive. And, while home ownership means expenses as well, for most retirees the biggest home-related cost—mortgage payments—are no longer a concern.


Two quarterly newsletters have been added—one about personal issues, and one about corporate issues.


Spring is the traditional season for real estate sales and purchases, and the spring of 2015 is proving to be no exception. In fact, the residential real estate market is particularly active this year. According to statistics compiled by the Canadian Real Estate Association (CREA), “actual (not seasonally adjusted) activity in March stood 9.5% above levels reported in March 2014 and slightly above the 10-year average for the month.”


According to figures posted on the Canada Revenue Agency (CRA) website, the Agency had, by April 19, 2015, received almost 16 million 2014 individual income tax returns, and had processed slightly more than 14 million of those returns. Those returns already processed represent about half of the total number of returns to be filed for the year: last year, the total number of T1 individual income tax returns filed was just over 28 million.


There was much speculation—and more than a few hints dropped—that this year’s federal budget would include an increase in the amount which individual Canadians can contribute to a Tax-Free Savings Account (TFSA). That increase was announced as anticipated and, effective with the 2015 tax year, eligible individuals can now contribute up to $10,000 per year to a TFSA. The former limit was $5,500.


Most Canadians, especially those nearing retirement, have saved money through a registered retirement savings plan (RRSP). For all those individuals, no matter what the size of their RRSP or what other sources of retirement income they have, the same rule applies. By the end of the year in which they turn 71, an RRSP holder must collapse that RRSP. There are, essentially, three options available to the individual at that point. First, he or she can simply collapse the plan and have all funds in that plan treated (and taxed) as income for that year. Unless the amount within the RRSP is very small, that’s obviously not a tax-efficient plan, and not a recommended one. Second, the individual can collapse the RRSP and use the funds to purchase an annuity, which will provide a (taxable) income stream for the term of the annuity. That term can be for a fixed number of years, or for the rest of the individual’s life, or some combination of the two. The advantage of an annuity is that it does provide income security for the individual. However, annuity payout rates are based on the interest rates in effect at the time the annuity is purchased, and the current low interest rate environment means that annuity rates are not currently, by historic standards, particularly generous.


An old but still valid axiom of tax planning is that the best year-end tax planning starts on January 1st. The concept of year-end tax planning as a year-round activity may indeed be the ideal, but it’s certainly not the reality for most Canadian taxpayers. Some may be alerted to the need to think about current-year taxes by the approach of the calendar year end, while others have their memories jogged by an imminent RRSP contribution deadline. For many (if not most) Canadians, however, taxes aren’t thought of until it’s time to complete the annual tax return. But, even for those taxpayers, options to reduce the annual tax bill are still available, through careful completion of that return.


Two reports released recently by Statistics Canada and by Canadian credit reporting agency TransUnion indicate that Canadians continue to rack up household and personal debt, but also that they might, perhaps, be getting better at managing that debt load.


Like the rest of the world, the Canada Revenue Agency (CRA) has moved in recent years to dealing with its client group—the Canadian taxpayer—online, through the Agency’s website. To do so, the CRA has steadily expanded its roster of online services, while at the same time reducing or eliminating the in-person, telephone, or paper service options it once provided.


For even the most determined of procrastinators, the deadline for filing an individual income tax return for the 2014 tax year is imminent. That deadline will come on Thursday, April 30 for most Canadians, and on Monday, June 15 for the self-employed and their spouses.


Canadians whose adult memories reach back a quarter century to the early 1990s will likely remember a series of television ads picturing middle-aged individuals or couples enjoying life in an idyllic setting, the result of having retired at the age of 55. The concept of that a financially comfortable retirement could be achieved before the traditional retirement age of 65 was a relatively novel one, and for working Canadians of that generation, the term “Freedom 55” came to represent an ideal.


As our tax system has become more and more complex, the number of individuals willing to brave the annual trip through 485 lines of the tax return and a 68-page tax guide on their own is declining. Consequently, the percentage of Canadians who have their return prepared by someone else with, presumably, more expertise has continued to increase.


Spring is, of course, income tax return filing season in Canada, and over the next four months millions of Canadians will file a return for the 2014 tax year. The filing deadline for this year is Thursday, April 30 for most taxpayers, and Monday June 15 for self-employed taxpayers and their spouses.


Every annual tax filing season brings with it a number of changes to the annual return. In some years those changes are broad-based, affecting large numbers of taxpayers, while in others the changes are more targeted, and of interest to only specific groups within the overall population.


Two quarterly newsletters have been added—one about personal issues, and one about corporate issues.


Canadian taxpayers don’t need a calendar to know that the registered retirement savings plan (RRSP) contribution deadline is approaching—the glut of television, radio, and internet ads which fill the airwaves and computer screens this time of year are reminder enough. And, while RRSP planning and retirement planning generally are best approached as an ongoing, year-round activity, it is true that an imminent deadline tends to focus the minds of taxpayers on such issues.


The announcement of a change in our tax laws to permit income splitting within families in order to reduce the overall family tax burden has received a lot of attention in the media of late. What’s not as well known is the fact that older Canadian taxpayers have in fact been able for several years to benefit from a similar income splitting strategy. Generally speaking, the opportunity to split pension income is available to couples who are 65 and over, and are receiving income from either RRSP/RRIF savings or from an employer-sponsored pension plan.


The early months of the new calendar year can feel like a never-ending series of bills and other financial obligations. Credit card bills from holiday spending, or perhaps a mid-winter vacation, are due or coming due. The RRSP deadline of March 2, 2015 is approaching, and the April 30, 2015 deadline for payment of 2014 taxes owed is not far behind.


As everyone knows—even those who aren’t parents—raising children is expensive. Even though basic needs like education and health care are publicly funded, there is still a never-ending list of discretionary and non-discretionary costs to be paid.


Planning for 2015 taxes even before the New Year is rung in may seem more than a little premature. Nonetheless, taking some time to review one’s tax situation—and perhaps putting a few strategies in place—at the beginning of the year can help avoid a cash flow crisis or other financial shock when the RRSP contribution deadline looms or it is tax filing (and tax payment) time in the spring of 2016. And, while many tax-planning and tax-saving strategies can be implemented throughout the tax year, getting an early start on such planning usually leads to the best results.


The Employment Insurance premium rate for 2015 is 1.88%.


The Canada Pension Plan contribution rate for 2015 is unchanged at 4.95% of pensionable earnings for the year.


Dollar amounts on which individual non-refundable federal tax credits for 2015 are based, and the actual tax credit claimable, will be as follows:


The indexing factor for federal tax credits and brackets for 2015 is 1.7%. Consequently, the following federal tax rates and brackets will be in effect for individuals for the 2015 tax year.


Each new tax year brings with it a listing of tax payment and filing deadlines, as well as some changes with respect to tax-planning strategies. Some of the more significant dates and changes for individual taxpayers for 2015 are listed herein.


In virtually every province and territory, the winter of 2014-15 has arrived early. Although the calendar may say that it’s still autumn, Canadians right across the country have already had to take out the snow shovels and re-learn winter driving skills. It’s no surprise, then, that the thought of escaping the Canadian winter for at least for a few weeks or months for a vacation down south is a priority for many Canadians.


It seems incongruous to talk about taxes in relation to seasonal holiday celebrations. And, while it’s true that there are no tax implications to most holiday events and traditions, unexpected tax consequences and costs can arise where gifts and celebrations take place in the context of an employment relationship.


While individual tax returns for 2014 don’t have to be filed, at the earliest, until April 30, 2015, it’s worth taking the time now to evaluate one’s tax situation and consider possible strategies to reduce the tax bill for 2014. With the exception of RRSP contributions (in most cases) and pension income splitting, tax-planning strategies intended to reduce one’s tax payable for this year must be put in place by December 31st, 2014. And, perhaps the only thing more frustrating than finding, on filing a return, that money is owed to the government is the realization that the option of taking steps to reduce or eliminate that tax bill is no longer available.


The prospect of being able to split income within a family group so as to reduce overall tax payable has been on the tax horizon for a few years now. A recent announcement indicates that the federal government intends to make such income splitting possible—to a certain extent.


Two quarterly newsletters have been added—one about personal issues, and one about corporate issues.


To an ever-increasing degree Canadians, including Canadian businesses, are managing their tax affairs and dealing with the Canada Revenue Agency (CRA) online, through the CRA website. That’s a trend that the Agency is eager to encourage and, to that end, it continues to add to the kinds of services and options which are available through the website. The most recent such changes add to the services available to Canadian businesses through the website service My Business Account.


After getting off to a somewhat bumpy start when they were first introduced in 2009, tax-free savings accounts (TFSAs) have become extremely popular with Canadians. The misunderstandings and mistakes which were all too common during the rollout of the program now occur with less frequency, and most Canadians who put aside savings on a regular basis have utilized TFSAs as a tax and savings vehicle.


As the number of Canadians approaching retirement age increases, so too does the concern that not enough of them are financially prepared for that retirement. Those concerns arise from two sources. First, the number of Canadians who are members of employer-sponsored registered pension plans has declined steadily over the past few decades, and now fewer than one-third of Canadian workers can count on receiving payments from such a plan in retirement. Even fewer are covered by the “gold standard” of pension plans—a defined benefit pension plan—which guarantees the payment of benefits at a pre-determined amount throughout retirement. Second, Canadians who are not members of registered pension plans are able to save for retirement through registered retirement savings plans (RRSPs). However, while many Canadians do contribute to their RRSPs each year, the amount contributed is, in many cases, significantly less than the maximum possible contribution which can be made by an individual for the year. As well, many Canadians have a significant RRSP contribution carryforward amount, indicating a pattern of contributing less than the allowable maximum in previous years.


Providing children with the opportunity to participate in organized sports or other athletic activities can be a very expensive undertaking. The cost of enrollment in such programs is sometimes just the start, as parents also face expenditures for uniforms and equipment (which children inevitably outgrow) and, sometimes, the cost of travel to games or tournaments.


It’s a fact of life that since 9/11 any kind of travel—especially cross-border travel to the United States—has become a much more time-consuming and difficult process. Greater security measures have led to increased documentation requirements, more restrictions on the contents of carry-on bags, earlier check-in times at airports, and much longer line-ups resulting in delays at land border crossings.


Being charged a fee for just about every bank service from using an ATM to making an e-transfer of funds to simply receiving a printed bank statement each month is a perennial irritant to many Canadians, as is the fact that such fees seem to increase on a regular basis. Canadian banks have sometimes been willing to waive or reduce such charges for some groups, such as seniors or students, but policies haven’t been consistent from bank to bank and could be changed or even eliminated at the bank’s discretion.


Receiving unexpected correspondence from the tax authorities is almost guaranteed to unsettle the taxpayer who receives that correspondence, even where there’s no reason to believe that anything is wrong. But, as the Canada Revenue Agency (CRA) begins its annual post-assessment tax return review process in the summer and fall, it’s an experience which will soon be shared by millions of Canadian taxpayers.


The federal government has announced that small and medium-sized Canadian businesses will be able to pay lower employer EI premiums, beginning January 1, 2015. While the program recently announced by the Minister of Finance is entitled the “Small Business Job Credit”, the credit actually operates by reducing, for a two-year period, the portion of Employment Insurance premiums paid by employers.


During the month of August, millions of Canadians received unexpected mail from the Canada Revenue Agency (CRA) containing an unfamiliar form—a 2014 Instalment Reminder. On that form, the CRA suggested to the recipient that he or she should make instalment payments of income tax on September 15 and December 15, 2014, and identified the amount which should be paid on each date.


The Canada Revenue Agency (CRA) is constantly seeking to enhance and upgrade its online services, and to encourage Canadians to manage their tax affairs through the Agency’s website. Those efforts have taken another step forward with the release of the CRA’s newest mobile app for small and medium-sized businesses.


Recently the Fraser Institute released a study (The Canadian Consumer Tax Index, 2014 edition) indicating that, for 2013, the payment of taxes consumed just under 42% of the average family’s income, and that the tax bill of the average Canadian family had increased by 1,832% percent since 1961. Both were startling figures and the results of the study were consequently widely reported in the media. As with all statistical studies and results, it’s useful to look behind those figures to understand the underlying data and methodology, and how the figures were arrived at.


Living with a significant disability, whether physical or mental, isn’t easy. In many instances, that disability can prevent an individual from working, or limit the person to part-time work, both of which affect financial well-being. In addition, disabled Canadians often must incur expenses not faced by other Canadians in order to enable them to live as independently as possible.


Two quarterly newsletters have been added—one about personal issues, and one about corporate issues.


Virtually all businesses in Canada which sell goods or services must collect goods and services tax (GST) or harmonized sales tax (HST) from purchasers of those goods and services. However, an exemption is provided for businesses whose taxable sales for a single quarter or over the previous four quarters total less than $30,000. Such businesses are known as "small suppliers", and they are not obligated to register for GST/HST purposes. Such businesses may, however, register voluntarily, in order to be able to claim input tax credits on the GST/HST they pay on their own purchases. Where such voluntary registration is done, the business must then remit GST/HST amounts collected on its own sales of goods and services to the federal government.


Canadians benefit from a health care system in which the cost of health care is paid out of public funds and the standard of care is equal to any in the world. While in other countries the cost of treatment for a major illness can literally push an individual or family into bankruptcy, Canadians can be assured that getting good medical treatment in Canada does not depend on having the money to pay for such treatment.


Canada’s mortgage lending rules (and banking practices in general) have always been more stringent and conservative that those which prevail in the United States. In large part because of that, Canada was spared the lending crisis which took place in the U.S. in 2007-2008, after a significant number of ill-advised sub-prime mortgages went into default and eventual foreclosure.


As summer starts winding down, post-secondary students will start thinking about choosing courses and finding a place to live during the coming academic year. Their parents’ attention will more likely be focused on the cost of that year, and the upcoming deadlines for payment of first semester tuition and housing costs.


Although they aren’t usually thought of in those terms Canadian charities, as measured by the amount of money they receive and administer, can be big businesses. However, because they collect and dispense that money in order to support and advance causes which create a public benefit, charities are accorded special status under our tax laws. Our tax system effectively subsidizes the activities of charitable organizations by providing a tax deduction or tax credit to companies and individuals that contribute to those organizations. To ensure that their activities are in furtherance of their charitable purposes, charities are required to file an annual information return outlining those activities. Recent changes made to that information return focus on situations in which political activities are undertaken by registered charities.


Tax-free savings accounts (TFSAs) were first made available by the federal government in 2009. While there were some early difficulties which led to many taxpayers inadvertently breaching TFSA rules, Canadian taxpayers and their financial advisers have now become accustomed to using TFSAs as a standard part of financial, tax, and retirement planning.


It goes without saying that developments in technology have made their mark in just about all areas of personal and business life. One of those changes has been the use of computer systems to record and document business transactions, including point-of-sale (POS) transactions in retail businesses. And, inevitably, the use of such systems has given rise to the development of software intended to defeat them. The possession and use of such software—known as electronic suppression of sales (ESS) software or, more familiarly, “zapper software”, is now an offence under Canada’s income tax and excise tax legislation.


It’s not unusual for a taxpayer to disagree with the Canada Revenue Agency’s (CRA) assessment of his or her tax return. When that happens, the first step is to get in touch with the CRA, by phone or letter, to determine just where the disagreement lies and whether it can be resolved. Where the CRA and the taxpayer can’t come to an agreement or compromise on what the taxpayer’s tax liability for the year should be, it’s time to move to the next level.


The picture that many Canadians have of corporate directors is that of a highly-paid director of a blue-chip multinational, travelling on the company jet to attend directors meetings in exotic locations. While there are certainly corporate directors who fulfill that perception, the reality is most Canadian companies are small or medium-sized owner-managed businesses. In such small operations, it’s not unusual for family members or friends to be asked to become directors of the company—often, when the business is first incorporated. In other instances, someone may agree to sit on the board of a local non-profit organization, as a way of supporting the activities of that organization. While many directors, especially first-time directors of small companies, view their position as purely nominal or honorary, the fact is that taking a position as a corporate director means taking on very real responsibilities. And, no matter what size the company or organization may be, the responsibilities of those directors are the same.


The spring and summer months are the traditional time for moving in Canada. Moving during these months allows Canadians to both take advantage of the warmer weather and to get settled into the new location in time for the upcoming school year. Canadians move for a lot of reasons—a new job or a job transfer, moving to be closer to family, moving when a growing family needs a larger home or, conversely, downsizing in anticipation of retirement. Whatever the reasons and whatever the distance, however, moving always involves costs and stress. Whether it’s the cost involved in preparing the current home to be put on the market, trips to the new location to search for a home, or just the cost of packing and transporting one’s belongings and driving to the new location, the financial outlay of moving can be considerable. In some circumstances, however, our tax system will provide for a deduction to help offset moving costs.


By now, most Canadians, (with the exception of the self employed and their spouses, who have until June 16) will have filed their 2013 income tax returns. And, since the goal of the Canada Revenue Agency (CRA) is to have returns processed and assessed within a maximum of six weeks from the time of filing, many of those who have filed will by now have received a Notice of Assessment for their 2013 return from the CRA.


ll Canadian businesses must report and pay tax on any income arising from their business activities, whether those activities are carried out from a traditional bricks and mortar office or storefront, or through one or more websites. The Canada Revenue Agency (CRA) has become increasingly concerned, in recent years, about income generated through e-commerce on the Internet, and particularly about the possibility that such income may go unreported and therefore untaxed.


Two quarterly newsletters have been added—one about personal issues, and one about corporate issues.


While the recent publicity around the “Heartbleed” computer bug has highlighted the vulnerability of taxpayers to gaps in computer security systems, such security glitches aren’t the only way in which the personal data of taxpayers can be compromised or taxpayers can be victimized by scams. Fraud isn’t, unfortunately, a seasonal business—every day of the year, attempts are made to cheat individuals out of their hard-earned savings or property. That said, the fact that it is tax-filing season makes it easier for those seeking to defraud others to carry out such ventures by passing themselves off as representatives of the Canada Revenue Agency.


Watching gas prices rise as the weather grows (slightly) warmer is a regular experience for Canadians—a rite of spring, if you will. The difference this year is that gas prices, which are, in mid-April, already at a three-year high in some provinces (at around $1.50 per litre in Montreal and Vancouver) seem likely to break new records this summer.


The issue of retirement financing is a hot topic these days. The concern is that too many Canadians are not financially prepared for retirement or, put more bluntly, that many of those approaching retirement simply won’t have sufficient resources to support them throughout their retirement years.


By now, almost everyone has heard of the “Heartbleed” computer bug, a programming error which left many computer systems around the world vulnerable to unauthorized access.


Over the past few years, there have been a lot of changes to the Canada Pension Plan, both in terms of contributions made to the plan, and with respect to the receipt of CPP retirement benefits. One of the least well-known and least understood of those changes is the CPP Post-Retirement Benefit, or PRB.

While most Canadians try to avoid the inevitable for as long as possible, there’s no escaping the fact that the tax payment deadline (for all Canadians) and the tax filing deadline (for the majority of Canadians) is now only a few weeks away. For all individual Canadians, the deadline for payment of all income taxes owed for the 2013 tax year is Wednesday, April 30, 2014—no exceptions and, in the absence of very unusual circumstances, no extensions.

By the beginning of April (and usually earlier), Canadian taxpayers will have in hand all of the information needed to prepare their 2013 income tax returns. Employers who issue T4 slips to their employees and financial institutions which provide T5 slips outling investment income (including interest and dividends) earned during 2013 by investors must issue such information slips to employees, shareholders, and account holders by the end of February 2014. Self-employed taxpayers, who must calculate their own business income for 2013, will certainly be in a position to do so by the end of the first quarter of 2014. Finally, retirees who receive pension income, either from a former employee or from the Canada Pension Plan or Old Age Security program will have received T4A information slips from the pension plan administrator or the government of Canada documenting that income for 2013.

By the time most Canadians sit down to organize their various tax slips and receipts, and undertake to complete their tax return for 2013, the most significant opportunities to minimize the tax bill for the year are no longer available. Most such tax-planning or saving strategies, in order to be effective for 2013, must have been implemented by the end of the calendar year. The major exception to that is, of course, the making of registered retirement savings plan (RRSP) contributions, but even that had to be done on or before March 1, 2014 in order to be deducted on the return for 2013.

This time of year the taxes that most Canadians are thinking of are the 2013 income taxes due on April 30. However, many Canadians will be reminded that the Canada Revenue Agency (CRA) is already thinking of taxes which will be owed for 2014 when they find an instalment reminder in their mail. For Canadians who have received many of such notices in the past, the reminder and the tax instalment process are familiar, although not necessarily welcome. For those who are new to that process, however, both the reminder itself and figuring out how to deal with it can be baffling.


With all the focus this time of year on making RRSP contributions and getting one’s 2013 tax return in on time, it may seem premature to start thinking of how to minimize tax payable for 2014. There nevertheless remain reasons why this is, in fact, a good time to be contemplating one’s tax liability for the current year