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Tax Alerts

As of January 1, 2018, the minimum wage will increase to $14.00 an hour. What does this mean to you as the employer?

 


The proposed tax changes may affect some businesses. The government will be looking closely at income splitting in a proprietorship and a corporation. However if the spouse or child receives reasonable compensation for work provided, there should not be an issue. If a professional incorporated and his family are shareholders, the government should be able to see the flow of money used to purchase the shares.

Those shareholders that hold investments within a corporation should wait for the government to make its decision on the tax changes. It will affect income going forward, not past investment funding and income. At the time it becomes law, discussions should be held with their accountants on whether it is cheaper to leave investment money in the corporation or withdraw and invest personally.

Any tax change affects each situation differently. Please contact us on how it may impact you.

 




Getting a post-secondary education – or professional training – isn’t inexpensive. Tuition costs can range from as little as $5,000 per year for undergraduate studies to as much as $40,000 in tuition for a year of professional education. And those costs don’t factor in necessary expenditures on textbooks and other ancillary costs, to say nothing of general living expenses, like rent, transportation and food.


When the Canada Pension Plan was launched in the mid-1960s, both the working lives and the retirements of Canadians looked a lot different than they do in 2018. Fifty years ago, most Canadians were able to work at a single full-time job, often held that job for most or all of their working lives and, in many cases, benefitted from an employer sponsored defined benefit pension plan which guaranteed a certain level of income in retirement.


Most Canadians deal with our tax system only once a year, when preparing the annual tax return. And, while that return – the T1 Individual Income Tax Return – may be only four pages long, the information on those four pages is supported by 13 supplementary federal schedules, dealing with everything from the calculation of the tax-free gain on the sale of a principal residence to the determination of required Canada Pension Plan contributions by self-employed taxpayers.


Anyone who has ever tried to reduce their overall personal or household debt knows that doing so, no matter how disciplined one’s approach, can seem like a one step forward, two steps back proposition. It sometimes seems that, just as measurable progress is achieved in one area (an extra payment is made on the mortgage), unexpected costs in another area (a significant car repair bill) push up the level of debt elsewhere (e.g., credit card debt).


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