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2023 June Tax News

Table of Contents

New information released on upcoming payment of grocery rebate

June 23, 2023

The federal government has released additional details of the “grocery rebate” which was announced in the 2023 federal Budget. That rebate is scheduled to be paid to eligible Canadians on July 5, 2023.

The federal government release states that the grocery rebate will be double the amount of any GST/HST tax credit received by an individual in January 2023. Specifically, single individuals without children can receive a maximum of $234, while married individuals without children can receive a maximum of $306. For both groups, the maximum rebate receivable increases with family size.

Details of eligibility requirements for the rebate, and how it is calculated, can be found on the federal government website at New Grocery Rebate – Canada.ca.

Claiming a deduction for moving costs (June 2023)

June 17, 2023

Sales of residential real estate across Canada are, after a slowdown in 2022, once again on the rise. Back-to-back increases in sales figures during February and March 2023 were followed by a double digit increase in such sales during the month of April. Those figures mean that tens of thousands of Canadians will be closing home sales transactions and moving this spring and summer. And, whatever the reason for the move or the distance to the new location, all moves have two things in common – stress and cost. Even where the move is a desired one – from an apartment to a first home, or moving to take one’s dream job, any move inevitably means upheaval of one’s life, and the costs (especially for a long-distance move) can be very significant. There is not much that can diminish the stress of moving, but the associated costs can be offset somewhat by a tax deduction which may be claimed for many of those costs.

While it’s common to refer simply to the “moving expense deduction”, as though it were available in all circumstances, the fact is that there is actually no across-the-board deduction available for moving costs. In order to be deductible from income for tax purposes, such moving costs must be incurred in specific and relatively narrow circumstances. Our tax system allows taxpayers to claim a deduction only where the move is made to get the taxpayer closer to his or her new place of work, whether that work is a transfer, a new job, or starting a business. Specifically, moving expenses can be deducted where the move is made to bring the taxpayer at least 40 kilometres closer to his or her new place of work. That requirement is satisfied where, for instance, a taxpayer moves from Ottawa to Calgary to take a new job. It’s also met where a taxpayer is transferred by his or her employer to another job in a different location and the taxpayer’s move will bring him or her at least 40 kilometres closer to the new work location. The requirement is not met where an individual or family move up the property ladder by selling and purchasing a new home (or buying a first home) in the same town or city where they currently live, without any change in work location.

As well, it’s not actually necessary to be a homeowner in order to claim moving expenses. The list of moving related expenses which may be deducted is basically the same for everyone – homeowner or tenant – who meets the 40-kilometre requirement. Students who move to take a summer job (even if that move is back to the family home) can also make a claim for moving expenses where that move meets the 40-kilometre requirement.

It’s important to remember, however, that even where the 40-kilometre requirement is met, it’s possible to deduct moving costs only from employment or self-employment (business) income – no deduction is allowed from other sources of income, like investment income or employment insurance benefits.

The general rule is that a taxpayer can claim most reasonable amounts that were paid for moving themself, family members, and household effects. In all cases, the moving expenses can only be deducted from employment or self-employment income which is earned at the new location. Where the move takes place later in the year, and moving costs are significant, it’s possible that the amount of income earned at the new location in the year of the move will be less than deductible moving expenses incurred. In such instances, those expenses can be carried over and deducted from employment or self-employment income earned at the new location in any future year.

Within the general rule, there are a number of specific inclusions, exclusions, and limitations. The following is a list of expenses which can be claimed by the taxpayer without specific dollar figure restrictions (but subject, as always, to the overriding requirement of “reasonableness”):

Traveling expenses, including vehicle expenses, meals, and accommodation, to move the taxpayer and members of their family to the new residence (note that not all members of the household have to travel together or at the same time);
Transportation and storage costs (such as packing, hauling, movers, in-transit storage, and insurance) for household effects, including such items as boats and trailers;
Costs for up to 15 days for meals and temporary accommodation near the old and the new residences for the taxpayer and members of the household;
Lease cancellation charges (but not rent) on the old residence;
Legal or notary fees incurred for the purchase of the new residence, together with any taxes paid for the transfer or registration of title to the new residence (excluding GST or HST);
The cost of selling the old residence, including advertising, notary or legal fees, real estate commissions, and any mortgage penalties paid when a mortgage is paid off before maturity; and
The cost of changing an address on legal documents, replacing driving licences and non-commercial vehicle permits (except insurance), and costs related to utility hook-ups and disconnections.

Every homeowner who is moving must decide whether to sell their current home before purchasing the new one, or to secure a new home first, and then put their current home on the market. Those who decide on the second approach are entitled to deduct up to $5,000 in costs incurred for the maintenance of the “old” residence while it is vacant and it is on the market. Specifically, costs including interest, property taxes, insurance premiums, and heat and utilities expenses paid to maintain the old residence while efforts were being made to sell it may be deducted. If any family members are still living at the old residence, or it is being rented, no such deduction is available.

It may seem from the forgoing that virtually all moving-related costs will be deductible – however, there are some costs for which the Canada Revenue Agency (CRA) will not permit a deduction to be claimed, as follows:

Expenses for work done to make the old residence more saleable;
Any loss incurred on the sale of the old residence;
Expenses for job-hunting or house-hunting trips to another city (for example, costs to travel to job interviews or meet with real estate agents);
Expenses incurred to clean or repair a rental residence to meet the landlord’s standards;
Costs to replace such personal-use items as drapery and carpets;
Mail forwarding costs; and
Mortgage default insurance.

To claim a deduction for any eligible costs incurred, supporting receipts must be obtained. While the receipts do not have to be filed with the return on which the related deduction is claimed, they must be kept in case the CRA wants to review them.

Anyone who has ever moved knows that there are an endless number of details to be dealt with. For some types of costs, the administrative burden of claiming moving-related expenses can be minimized by choosing to claim a standardized amount, rather than the actual amount of expense incurrred. Specifically, the CRA allows taxpayers to claim a fixed amount, without the need for detailed receipts, for travel and meal expenses related to a move. Using that standardized, or flat rate method, taxpayers may claim up to $23 per meal, to a maximum of $69 per day, for each person in the household. Similarly, the taxpayer can claim a set per-kilometre amount for kilometres driven in connection with the move. The per-kilometre amount ranges from 55.0 cents for Alberta and Saskatchewan to 67.5 cents for the Northwest Territories. In all cases, it is the province or territory in which the travel begins which determines the applicable rate.

These standardized travel and meal expense rates are those which were in effect for the 2022 taxation year – the CRA will be posting the rates for 2023 on its website early in 2024, in time for the tax filing season.

Once eligibility for the moving expense deduction is established, the rules which govern the calculation of the available deduction are not complex, but they are very detailed. The best summary of those rules is found on the form used to claim such expenses – the T1-M. The current version of that form can be found on the CRA’s website at Moving Expenses Deduction. (canada.ca) and more information (including a link to rates for standardized meal and travel cost claims) is available at Line 21900 – Moving expenses – Canada.ca.

Making sure your taxes for 2023 are on track (June 2023)

June 17, 2023

Many, if not most, taxpayers think of tax planning as a year-end exercise to be carried out in the last few weeks of the year, with a view to taking the steps needed to minimize the tax bill for the current year. And it’s true that almost all strategies needed to both minimize the tax hit for the year and to ensure that there won’t be a big tax bill come next April must be taken by December 31 of the current calendar year(the making of registered retirement savings plan (RRSP) contributions being the notable exception). Nonetheless, there’s a lot to recommend carrying out a mid-year review of one’s tax situation for the current year. Doing that review mid-year, instead of waiting until December, gives the taxpayer the chance to make sure that everything is on track and to put into place any adjustments needed to help ensure that there are no tax surprises when the income tax return for 2023 is filed next spring. As well, while the deadline for implementing most tax saving strategies may be December 31, the window of opportunity to make a significant difference to one’s current-year tax situation does narrow as the calendar year progresses.

By the middle of June, most Canadians will have filed their individual income tax return for the 2022 tax year and received a Notice of Assessment outlining their tax position for that year. Those who receive a refund will celebrate that fact; less happily, those who receive a tax bill will pay the amount owed, however reluctantly. Although few Canadians have this perspective, the reality is that getting either a big tax refund or having to pay a large tax bill is a sign that one’s tax affairs need attention. A refund, especially a large refund, means that the taxpayer has overpaid his or her taxes for the previous year and has essentially provided the Canada Revenue Agency with an interest-free loan of funds that could have been put to better use in the taxpayer’s hands. The other outcome – a large bill – means that taxes have been underpaid for the previous year and could mean paying interest charges to the CRA. Either way, it’s in the taxpayer’s best interests to ensure that tax paid throughout the year is sufficient to cover his or her taxes, without overpaying or underpaying. The best-case scenario is to file a tax return and receive a Notice of Assessment which indicates that there is neither a substantial refund payable nor any significant amount owing.

For most Canadians, income and available deductions and credits don’t vary substantially from one year to the next. Where that’s the case, the amount of tax owed by the taxpayer for 2022 (a figure that can be found on Line 43500 of the Notice of Assessment) is likely to be very close to one’s tax liability for 2023.

After determining the amount of one’s tax liability for 2022, the next step in doing a review is to get a sense of how much tax has already been paid for the 2023 tax year. There are two ways of paying taxes throughout the year. The majority of Canadians (including all employees) have income taxes deducted from their paycheques and remitted to the federal government on their behalf – known as source deductions. Taxpayers who do not have income tax deducted at source – which would include self-employed individuals and, frequently, retired taxpayers – make tax payments directly to the federal government (four times a year, in March, June, September, and December) through the tax instalment system.

Using the tax payable figure for 2022 as a guide, it’s necessary to figure out whether income tax payments made to date, either by source deductions or instalment payments, match up with that tax liability figure, recognizing that by this point in the year, approximately one-half of taxes for 2023 should already have been paid. If they haven’t, and particularly if there is a significant shortfall which will mean a large balance owing when the tax return for 2023 is filed next spring, the taxpayer will need to take steps to remedy that.

Where the individual involved pays tax by instalments, the solution is simple. He or she can simply increase or decrease the amount of remaining instalment payments made in 2023 so that the total instalment payments made over the course of this year accurately reflect the total tax payable for the year. The only caveat in that situation is that the individual should err on the side of caution to ensure that there isn’t a shortfall in instalment payments, which could result in interest charges being levied by the CRA.

The situation is a little more complex for employees, or anyone who has tax deducted at source. Often when such individuals discover that they are overpaying taxes through source deductions, it’s because other deductions which they claim on their return for the year – for expenditures like deductible support payments, child care expenses, or contributions to an RRSP – aren’t taken into account in calculating the amount of tax to deduct at source. The solution for employees who find themselves in that situation is to file a Form T1213 – Request to Reduce Tax Deductions at Source, which is available on the CRA website at T1213 Request to Reduce Tax Deductions at Source – Canada.ca. On that form, the taxpayer identifies the amounts which will be deducted on the return for the year and, once the CRA verifies that those deductible expenditures are being made, it will authorize the taxpayer’s employer to reduce the amount of tax which is being withheld at source to take account of that deduction.

Where it’s the opposite situation and a taxpayer finds that source deductions being made will not be sufficient to cover his or her tax liability for the year (meaning a tax bill to be paid next spring), the solution is to have those source deductions increased. To do that, the employee needs to obtain a federal TD1 form for 2023, which is available on the CRA website at https://www.canada.ca/en/revenue-agency/services/forms-publications/td1-personal-tax-credits-returns/td1-forms-pay-received-on-january-1-later.html. On the reverse side of that Form TD1, there is a section entitled “Additional tax to be deducted”, in which the employee can direct his or her employer to deduct additional amounts at source for income tax, and can specify the dollar amount which is to be deducted from each paycheque, on a go-forward basis.

Alternatively, the taxpayer who is looking at a large tax bill on filing the 2023 return can take steps to bring down that bill by creating or increasing available deductions. The most widely available strategy which will provide the greatest tax savings is an RRSP contribution, which reduces taxable income on a dollar-for-dollar basis. And while it’s difficult for most taxpayers to come up with such a contribution at the last minute, starting mid-year to transfer a set amount from each paycheque received between June of 2023 and February of 2024 to one’s RRSP can result in a substantial contribution deduction and a resulting reduction in the tax bill for the year.

No one particularly likes thinking about taxes, at any time of year, but ignoring the issue definitely won’t make it go away. The investment of a few hours of time now, and putting in place any needed adjustments, can mean avoiding a nasty surprise in the form of a large balance owing when the return for 2023 is completed next spring.

Claiming the principal residence exemption in 2023 – some new rules (June 2023)

June 17, 2023

The purchase of a first home is a milestone in anyone’s life, for many reasons. A home purchase is likely the largest single financial transaction most Canadians will enter into in their lives, and having the ability to buy one’s own home has traditionally been perceived as a marker of financial success and stability.

While there are many intangible benefits to owning a home, home ownership also provides some very tangible and significant financial advantages. Specifically, it provides the opportunity to accumulate wealth through increases in home equity, and to realize that wealth on a truly tax-free basis.

Most Canadians who purchase a home do so by making a down payment and borrowing the remainder of the purchase price of the home from a financial institution. That borrowing – the home mortgage – is paid off, with interest, usually over a 25- or 30-year period, at the end of which the homeowner owns the property outright. And, in virtually all instances, the value of that property is likely to be many times more than the original purchase price. In many locations in Canada, a home purchased in 1998 for $200,000 could have, by 2023, a market value of $1,000,000.

The real benefit of such asset growth, however, is found in the way such increases in value are treated for tax purposes. The Canadian tax system is a very comprehensive one, and there are very few sources of income or investment gains which escape the tax net. Home ownership is one of those few exceptions.

Under Canadian tax rules, where an asset is sold, the increase in the value of that asset over its original purchase price is treated as a capital gain, 50% of which must be included in taxable income and taxed as such. However, where a family home is sold, any increase in value (that is, any gain) is exempt from tax, regardless of the amount of such gain. Continuing the above example, a homeowner who paid $200,000 for a home in 1998 and sells that home in 2023 for $1,000,000 has a gain of $800,000. Assuming that the property was lived in and used as a home (a “principal residence” in tax parlance) for the entire 23 years of ownership, the full $800,000 gain can be received tax-free. If that gain were treated as a capital gain, and taxed as such, approximately $200,000 of the gain would have to be paid in capital gains tax.

The tax-free status of gains made on the sale of a family home is known, for tax purposes, as the principal residence exemption (PRE) and has been available to Canadians since 1972. And, for nearly 45 years after that, there were no changes made to the rules governing the availability of the exemption, or the reporting requirements for claiming it. In the last eight years, however, and especially in 2023, the rules with respect to the exemption have been tightened.

The need for changes arose out of a perceived change in the way the housing market operated, resulting from unprecedented increases in the price of residential properties over a relatively short period of time. While there are have always been individuals or companies who purchased properties with the intent of reselling them, perhaps after undertaking renovations, most purchases of residential real estate were made by individuals or families intending to live in them. However, it became possible, over the past 10 or 15 years, to purchase a property and re-sell it relatively soon thereafter for a very substantial profit. And, where the PRE was claimed on that sale, the entire profit would be received tax-free.

These changes in the housing market led to what the federal government perceived as a situation in which housing was being bought and sold as a commodity rather than for its traditional purpose of providing a home, and that the principal residence exemption was being used to avoid the payment of profits made from the “flipping” of properties in a way that was never intended. A secondary effect of such “commodification” of residential real estate was to drive up the price of properties, putting home ownership further and further out of the reach of the average Canadian.

For both these reasons, the federal government moved, in 2016 and again in 2023, to make changes to ensure that the principal residence exemption was being used for its intended purpose, and only by those who were entitled to claim it.

The first such change, which took effect as of January 1, 2016, was an administrative measure which required taxpayers, for the first time, to report any transaction for which the PRE was being claimed. Beginning with the 2016 tax year, individuals who are claiming the PRE for a property sale which took place during the year are required to complete Schedule 3 on their tax return for the year, confirming that fact and indicating the tax years for which the exemption is being claimed.

It’s important to note that the new requirement to report any claims for the PRE does not in any way change the rules respecting either eligibility for the exemption or the tax treatment of amounts received on the sale of a principal residence. What it does, however, is provide the tax authorities with information which could flag claims for the PRE which those tax authorities view as requiring further investigation. For instance, where an individual claims the principal residence exemption on two sales of residential property within a three-year period, it’s very likely that the tax authorities will want further information to determine whether either or both such transactions fit within the ambit of the rules governing the PRE.

In fact, as reported in the media, the Canada Revenue Agency has sent out “educational letters” to several hundred taxpayers who have claimed the PRE in circumstances which the CRA believes merit further investigation. Those letters suggest that taxpayers contact the CRA to provide an explanation for their use of the PRE, or to amend their return(s) if necessary.

These CRA enforcement activities are unlikely to affect taxpayers who sell a principal residence perhaps two or three times during their lifetime: the CRA’s efforts are directed at those who may be repeatedly using the PRE to shelter income or capital gains which should be reported as (and taxed as) income. Nonetheless, it remains the case that anyone claiming the PRE in any year after 2015 must file a Schedule 3 with their return for the year, certifying that fact, in order to be able to benefit from it.

The second change made by the federal government with respect to the PRE was much more substantive, and aimed directly at those who, in the government’s view, are misusing the PRE. That change, which is effective as of 2023, provides that anyone who sells a property which they have owned for less than 12 months would be considered to be “flipping” properties. Where that is the case, 100% of any gain made on the sale of the property would be included in income and taxed as business income. In other words, not only would the seller of the property not be eligible for the PRE, the gains made on the sale of the property would not be treated as a capital gain (only half of which is included in income for tax purposes) but as business income, the entirety of which is included in income and taxed as such.

The difference in the tax result is best illustrated using the example above. An individual who purchases a property for $200,000 and sells that property for $1,000,000 has a gain of $800,000. The result of the different possible tax treatments of that gain is as follows:

Where the sale is fully eligible for the principal residence exemption, the total tax payable on the gain is $0;
Where the gain is treated as a capital gain, the total tax payable on that gain is about $200,000; and
Where the property sale takes place after 2022 and the property was owned for less than 12 months, the new rule will apply, and the total tax payable on the gain will be about $400,000.

Of course, while most Canadians who purchase a home to live in as a principal residence don’t intend to sell within a year of purchase, life’s circumstances can sometimes dictate a different outcome. Consequently, exemptions from the new tax consequences of selling within 12 months of purchase will be provide for Canadians who sell their home due to specified life events, such as a death, disability, the birth of a child, a new job, or a divorce.

The changes made to the PRE rules in 2016 and 2023 don’t change the fact that home ownership remains one of the very best tax savings and wealth building strategies available to Canadians. Those who buy intending to live in the property as a family home are unlikely to be affected by the 2023 rule changes, and compliance with the new reporting requirements introduced in 2016 will ensure that they make the most of the tax saving possibilities available to them.

More information on the rules governing the sale of a principal residence and claiming the exemption can be found on the CRA website at https://www.canada.ca/en/revenue-agency/services/tax/individuals/topics/about-your-tax-return/tax-return/completing-a-tax-return/personal-income/line-12700-capital-gains/principal-residence-other-real-estate/sale-your-principal-residence.html and https://www.budget.canada.ca/2022/report-rapport/chap1-en.html#2022-4.

June 15, 2023 filing deadline for self-employed taxpayers

June 3, 2023

While most Canadian taxpayers were required to file their income tax returns for the 2022 tax year on or before May 1, 2023, self-employed taxpayers (and their spouses) have until Thursday June 15, 2023 to file such returns.

The extended filing deadline does not apply to payment of taxes owed for the 2022 tax year, as all such payments were due on or before May 1, 2023. Where payments have not been made in full, interest on any shortfall is currently accruing at a rate of 9%, compounded daily.

Information on filing a return for 2022 can be found on the Canada Revenue Agency website at https://www.canada.ca/en/services/taxes/income-tax/personal-income-tax.html and https://www.canada.ca/en/revenue-agency/services/e-services/e-services-individuals/netfile-overview.html.

Second individual income tax instalment for 2023 due June 15

June 3, 2023

Canadians who pay income tax by instalment make those instalment payments of tax four times each year, by specified deadlines.

The second income tax instalment deadline for the 2023 tax year falls on Thursday, June 15. Information on the instalment payment program, available options with respect to determining the amount of instalment payment to be made, and methods for making an instalment payment can be found on the Canada Revenue Agency website at https://www.canada.ca/en/revenue-agency/services/payments-cra/individual-payments/income-tax-instalments.html.

About Expert Fiscaliste

Expert Fiscaliste provides income tax preparation and consulting services to individuals, businesses, with real estate residential operations in Quebec.

If you want to take advantage of our services for your Tax Returns Give us a call at 514-954-9031, or visit our Contact Tax Experts page.

2023 May Tax News

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When you make a mistake on your (already filed) tax return

May 24, 2023

The vast majority of Canadians view completing and filing their annual tax return as an unwelcome chore, and generally breathe a sigh of relief when it’s done for another year. When things go entirely as planned and hoped, the taxpayer will have prepared a return that is complete and correct, and filed it on time, and the Canada Revenue Agency (CRA) will issue a Notice of Assessment indicating that the return is “assessed as filed”, meaning that the CRA agrees with the information filed and tax result obtained by the taxpayer. While that’s the outcome everyone is hoping for, it’s a result which can be derailed in any number of ways.

Over 94% of the returns which had been filed for the 2022 tax year by mid-April 2023 were filed through online filing methods (NETFILE or EFILE), meaning that they were prepared using tax return preparation software. The use of such software significantly reduces the chance of making a clerical or arithmetic error, like entering an amount on the wrong line or adding a column of figures incorrectly. However, no matter how good the software is, it can work only with the information that is provided to it. Sometimes taxpayers prepare and file a return, only to later receive a tax information slip that should have been included on that return. It’s also easy to make an inputting error when transposing figures from an information slip (for example, a T4 slip from one’s employer) into the software, such that $73,246 in income becomes $72,346. Whatever the cause, where the figures input are incorrect or information is missing, those errors or omissions will be reflected in the final (incorrect) result produced by the software.

In other cases, a receipt for something like a charitable donation may be overlooked when the taxpayer is completing the return, or may be received after the return has already been filed. Whatever the cause or reason for the error or omission in an already filed return, the question which immediately arises is how to make things right. And, no matter what the reason for the error or omission, the course of action to be followed by the taxpayer is the same.

For more information on Notice of Assessment see https://www.expert-fiscaliste.org/individual-tax/notice-of-assessment/

When and how to dispute your Notice of Assessment

May 24, 2023

Of the 17 million individual income tax returns for the 2022 tax year filed with the Canada Revenue Agency (CRA) by the middle of April 2023, no two were identical. Each return contained its own particular combination of types and amounts of income reported and deductions and credits claimed. There is, however, one thing which every one of those returns has in common: For each and every one, the CRA will review the return filed, determine whether it is in agreement with the information contained therein, and, finally, issue a Notice of Assessment (NOA) to the taxpayer summarizing the Agency’s conclusions with respect to the taxpayer’s tax situation for the 2022 tax year.

When all goes as it should, the information contained in the NOA is the same as that provided by the taxpayer in his or her return. In a minority of cases, however, the information presented in the NOA will differ from that provided by the taxpayer in his or her return. Where that difference means an unanticipated refund, or a refund larger than the one expected, it’s a good day for the taxpayer. In some cases, however, the NOA will inform the taxpayer that additional amounts are owed to the CRA. When that happens, the taxpayer has to figure out why, and to decide whether or not to dispute the CRA’s conclusions.

For more information on Notice of Assessment see https://www.expert-fiscaliste.org/individual-tax/notice-of-assessment/

Making a payment arrangement with the Canada Revenue Agency

May 20, 2023

All Canadian individual taxpayers were required to pay any tax balance owed for the 2022 tax year on or before May 1, 2023. As of May 2, 2023, interest at a rate of 9% is levied on all such outstanding amounts, and such interest charges are compounded daily.

Where an individual cannot pay 2022 taxes owed, in whole or in part, it is possible to reach a payment arrangement with the Canada Revenue Agency (CRA) which allows the taxpayer to pay outstanding amounts over time.

Information on the kinds of arrangements which are available, and how to contact the CRA to make such arrangements, can be found on the Agency’s website at https://www.canada.ca/en/revenue-agency/services/payments-cra/individual-payments/unable-pay.html and https://www.canada.ca/en/revenue-agency/services/payments-cra/payment-arrangements.html.

CRA issues updated publication on taxpayer objection and appeal rights

May 12, 2023

Most Canadians were required to file an income tax return for the 2022 tax year by the end of April 2023. For each such filing, a Notice of Assessment is issued by the Canada Revenue Agency (CRA), outlining the Agency’s conclusions with respect to the individual’s tax situation (and tax liability) for the year.

Where the information on the Notice of Assessment differs from that which was provided by the taxpayer on the return (and particularly where those differences result in increased tax payable by the taxpayer), that taxpayer must decide whether to object to the CRA’s conclusions as outlined in the Notice of Assessment.

The CRA recently updated and re-issued its publication outlining the circumstances in which a taxpayer can file an objection to the Notice of Assessment and how to do so. The updated publication – Resolving Your Dispute – Objection Rights under the Income Tax Act 2022 (P148 (E) Rev. 22) can be found on the CRA website at https://www.canada.ca/content/dam/cra-arc/formspubs/pub/p148/p148-22e.pdf.

About Expert Fiscaliste

Expert Fiscaliste provides income tax preparation and consulting services to individuals, businesses, with real estate residential operations in Quebec.

If you want to take advantage of our services for your Tax Returns Give us a call at 514-954-9031, or visit our Contact Tax Experts page.

2023 April Tax News

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May 1, 2023 deadline for payment of individual income taxes for 2022

April 28, 2023

Monday May 1, 2023 is the deadline by which all individual income taxes owed for the 2022 tax year must be paid. The May 1 payment deadline applies regardless of the date by which an individual must file their income tax return for 2022.

There are a number of methods by which taxes owed can be paid to the Canada Revenue Agency (CRA), and those are listed on the CRA’s website at https://www.canada.ca/en/revenue-agency/services/payments-cra.html.

Taxpayers should note that the current labour disruption at the CRA does not affect or extend the payment deadline, which remains May 1, 2023.

May 1, 2023 deadline for filing of individual income tax returns for 2022

April 28, 2023

Most individual Canadian taxpayers must file their income tax returns for the 2022 tax year on or before Monday, May 1, 2023. Self-employed individuals and their spouses, however, have until June 15, 2023 to file their returns for 2022.

The filing deadline is not affected by the current labour disruption at the Canada Revenue Agency. While the processing of returns (especially paper-filed returns) may be delayed, the filing deadline nonetheless remains Monday May 1, 2023, and late-filing penalties will apply where returns are filed after that date.

The CRA’s NETFILE service for the online filing of individual income tax returns can be found on the Agency’s website at https://www.canada.ca/en/revenue-agency/services/e-services/e-services-individuals/netfile-overview.html.

Some tax filing strategies for the 2022 return (April 2023)

April 18, 2023

It is an axiom of tax planning that the best year-end tax planning begins on January 1. And while it’s true that opportunities to make a significant dent in one’s tax payable for the year diminish as the calendar year winds down, it’s not the case that the time frame for taking advantage of such opportunities has passed.

Most tax planning strategies, in order to affect one’s tax liability for the year, must be put in place prior to December 31. The one major exception to that rule is contributions made to one’s registered retirement savings plan (RRSP), but even that must be done within 60 days after the end of the calendar year.

At this point there are a couple of ways to minimize the tax hit for 2022 – by claiming all available deductions and credits on the return, and also by making sure that those deductions and credits are structured and claimed in the way which will give the taxpayer the greatest tax benefit. It would seem logical to claim every possible deduction, to the maximum extent possible, but that’s not in fact always the best approach. It is counterintuitive, but sometimes the best overall tax result can be obtained by deferring tax deduction or credit claims to a future year, or by transferring them to another family member.

Two of the mostly widely available opportunities to do so involve claims for tax credits involving medical expenses incurred and charitable donations made. What follows is an outline of how those medical and charitable donation expense and credit claims can be structured to reduce tax payable for 2022, and in some cases, for future years.

Charitable donations

Taxpayers are entitled to make a claim on the annual tax return for charitable donations made in the current (2022) year or any of the previous five years. The reason it can sometimes makes sense not to claim a charitable donation in the year it was made arises from the way in which the charitable donations tax credit is structured to encourage higher donations.

That credit, at both the federal and provincial/territorial levels, is a two-tier credit. Federally, the first $200 in donations receives a credit of 15% of the total donation, or $30. However, donations above the $200 level receive a credit equal to 29% of the donation amount over $200.

Take, for example, a taxpayer who makes a regular contribution to a favourite charity of $100 each month, or $1,200 per year. Where he or she claims that donation on the annual return each year, that claim will result in a federal credit of $320 ($200 times 15%, plus $1,000 times 29%). Where, however, the same taxpayer defers the claim to the following year and claims a total of $2,400 in donations on a single return, he or she will receive a federal credit of $668. ($200 times 15%, plus $2,200 times 29%). Where the donations are accumulated and claimed once every five years, the federal credit received will be $1,712 ($200 times 15%, plus $5,800 times 29%). Under each scenario, the total charitable donation made is the same, but the amount of credit received increases with each year that the claim is deferred. Since each of the provinces and territories provide a two-tier credit (at varying rates, depending on the jurisdiction), the same result will be seen when calculating the provincial/territorial credit.

It’s important to note as well that charitable donations made by either spouse can be combined and claimed on the return for one of those spouses, thereby increasing the amount of charitable donations available to claim and possibly the amount of credit which can be received.

Medical expenses

Notwithstanding our publicly funded health care system, there are a great (and increasing) number of medical and para-medical expenses for which coverage is not provided and which must be paid on an out-of-pocket basis. In many instances, it’s possible to claim a medical expense tax credit for those out-of-pocket costs.

The federal credit for such expenses is 15% of allowable expenses. As is usually the case, the provinces and territories also provide a credit for the same expenses, at varying rates.

Many taxpayers, with some justification, find the rules on the calculation of a medical tax credit claim confusing. First, there is an income threshold imposed. Medical expenses eligible for the credit are qualifying expenses which exceed 3% of net income, or (for 2022) $2,497, whichever is less. Put more practically, for 2022 taxpayers who have net income of $83,250 or more can claim medical expenses incurred over $2,497. Those with lower incomes can claim medical expenses which exceed 3% of that lower net income. For instance, a taxpayer having $35,000 in net income could claim qualifying medical expenses incurred over $1,050 (3% of $35,000).

The other aspect of the medical expense tax credit which can be confusing is the calculation of the optimal time period. Unlike most tax credit claims, the medical expense tax credit can be claimed for qualifying expenses which were paid in any 12-month period ending during the tax year. While confusing, this rule is beneficial, in that it allows taxpayers to select the particular 12-month period during which medical expenses (and therefore the resulting credit claim) is highest. The only restrictions are that the selected 12-month period must end during the calendar year for which the return is being filed and, of course, any expenses which were claimed on a previous return cannot be claimed again.

While only expenses which exceed the $2,497 / 3% threshold may be claimed, it’s also possible to aggregate expenses incurred within a family and make a single claim for those expenses on the return of one spouse. Specifically, the rules allow families to aggregate medical expenses incurred for each spouse and for all children born in 2005 or later. While medical expenses incurred by a single family member might not be enough to allow him or her to make a claim, aggregating those expenses is very likely (especially for a family that does not have private medical insurance coverage) to mean that total expenses will exceed the applicable threshold.

In determining who will make the medical tax credit claim for a family, there are two points to remember. Since total medical expenses claimable are those which exceed the 3% of net income / $2,497 threshold, whichever is less, the greatest benefit will be obtained if the spouse with the lower net income makes the claim for total family medical expenses. However, the medical expense credit is a non-refundable one, meaning that it can reduce tax otherwise payable, but cannot create (or increase) a refund. Therefore, it’s necessary that the spouse making the claim have tax payable for the year of at least as much as the credit to be obtained, in order to make full use of that credit.

Finally, there are a huge number and variety of medical expenses which individuals and families may incur, and the rules governing which can be claimed and in what circumstances are very specific. In some cases, for instance, a doctor’s prescription will be required, while in others it will not. The very long list of medical expenses eligible for the credit, and any ancillary requirements, such as a prescription, can be found on the Canada Revenue Agency website at https://www.canada.ca/en/revenue-agency/services/tax/individuals/topics/about-your-tax-return/tax-return/completing-a-tax-return/deductions-credits-expenses/lines-33099-33199-eligible-medical-expenses-you-claim-on-your-tax-return.html.

What to expect when you hear from the Canada Revenue Agency (April 2023)

April 18, 2023

Most Canadians live their lives with only very infrequent contact with the tax authorities and are generally happy to keep it that way. Sometime between mid-February and the end of April (or June 15 for self-employed taxpayers and their spouses) a return must be filed by the taxpayer and a Notice of Assessment is then issued by the Canada Revenue Agency (CRA). In most cases, the taxpayer will receive a tax refund by direct deposit to his or her bank account, while in a minority of cases the taxpayer will have to pay a tax amount owing on or before May 1, 2023.

Sometimes, however, the process does not play out in quite that way. In some cases, the CRA will have questions about information reported on the taxpayer’s return – perhaps an income amount reported does not match up with the amount reported to the CRA by the payor of that income. In other cases, the taxpayer may have claimed a deduction or credit, and the CRA wants the taxpayer to provide them with the receipt or other documentation to support that deduction or credit claim. In both cases, the CRA may contact the taxpayer to resolve the discrepancy or to obtain the information needed to finish processing the taxpayer’s return. In some cases, that contact will occur before the CRA issues the Notice of Assessment with respect to the taxpayer’s return, while in others it will not take place until after the Notice of Assessment has been issued.

While no one particularly likes hearing from the tax authorities, it is critical that the taxpayer respond to any enquiry from the CRA. Failing to do so will mean, at a minimum, that the processing of one’s tax return will be delayed; or worse, a claim made on the return will be denied because the taxpayer has not responded to requests to provide the CRA with supporting documentation.

The problem which arises for the taxpayer is determining whether a communication received is in fact a legitimate request from the CRA or is part of a scam, phishing, or fraud attempt. Scams in which fraud artists claim to be from the CRA have become ubiquitous over the past decade or so, to the point that almost everyone has (or knows someone who has) received a fraudulent communication purporting to be from the tax authorities and requesting information from the taxpayer.

In an effort to address this issue, the CRA recently posted on its website a guide to how to distinguish legitimate queries received from the Agency from scams or phishing attempts. The Agency’s goal is two-fold: the first, of course, is to help taxpayers avoid becoming yet another victim of such frauds, and the second is to prevent situations in which taxpayers ignore legitimate communications from the Agency, having dismissed them as just another phishing attempt.

To help taxpayers verify that a contact is legitimately from the CRA, the Agency utilizes a number of strategies and security measures. First, any initial contact from the CRA will be by way of letter or phone call. The CRA does not send or receive emails pertaining to confidential individual tax matters. It also does not contact taxpayers by text message or on any social media sites. Taxpayers who have not signed up for the CRA service My Account will receive a letter from the CRA by regular mail, or will receive a phone call. Those who have signed up for My Account will be able to access any letters or electronic communication from the Agency on the CRA website, but only after signing into My Account. My Account, like all of the CRA’s sign-in services, now requires multi-factor authentication.

Where an unsolicited contact from the CRA to an individual taxpayer is by telephone, it can be difficult to determine whether that unfamiliar voice on the telephone is in fact a CRA employee. Any legitimate CRA employee will identify themself when they contact a taxpayer and will provide that taxpayer with their name and phone number to call them back, if needed. (Taxpayers should be aware that relying on call display to verify the source of the call is not a good idea, as scammers have been able to manipulate that technology to display what looks very much like, or even the same as, a legitimate CRA phone number.)

The Agency suggests that where there is any doubt about the identity of a caller claiming to be from the CRA, taxpayers consider taking the following steps to ensure that they are, in fact, speaking to a CRA employee.

Tell the caller you would like to first verify their identity.
Request and make a note of their:
- name,
- phone number, and
- office location.
End the call. Then check that the information provided during the call was legitimate by contacting the CRA. It is important to do this BEFORE providing any information to the caller.

Not infrequently, a taxpayer will contact the CRA through one of its individual or business tax help lines, which are answered by call center agents. Each of those telephone services offers an automated callback service – when wait times reach a certain threshold, the taxpayer is given the option of receiving a callback rather than continuing to wait on hold. Where the taxpayer chooses the callback option, he or she is provided with a randomized four-digit confirmation number. The CRA call center agent who returns the taxpayer’s call will repeat that number, so that the taxpayer can be certain that it is a CRA employee who is calling.

Finally, there are some actions which, if taken by anyone purporting to be from the CRA, should lead the taxpayer to immediately end the telephone call, including the following:

the caller does not give you proof of working for the CRA, for example, their name and office location;
the caller pressures you to act now, uses aggressive language, or issues threats of arrest or sending law enforcement;
the caller asks you to pay with prepaid credit cards, gift cards, cryptocurrency, or some other unusual form of payment;
the caller asks for information you would not enter on your return or that is not related to money you owe the CRA, for example, a credit card number;
the caller recommends that you apply for benefits:
- do not provide information to callers offering to apply for benefits on your behalf;
- you can apply for benefits directly on Government of Canada websites or by phone.

In addition, a CRA representative will never:

demand immediate payment from the taxpayer by any of the following methods:
- Interac e-transfer,
- Cryptocurrency (Bitcoin),
- Prepaid credit cards,
- Gift card from retailers such as iTunes, Amazon, or others;
ask the taxpayer for a fee to speak with a contact centre agent;
set up a meeting in a public place to take a payment from the taxpayer;
use aggressive language or threaten the taxpayer with arrest, deportation, or sending the police;
leave voicemails that are threatening to the taxpayer, or that include the taxpayer’s personal or financial information; or
send an email or text message with a link to the taxpayer’s refund.

While scams and frauds and their perpetrators have been around for literally centuries, changes in technology mean that most taxpayers are now accustomed to and at ease with conducting much of their personal and financial lives online, making it much easier to carry out such deceptions. And even newer technology, like artificial intelligence, poses additional threats for the future. In such an environment, the taxpayer’s best protection is to take whatever steps are needed to verify the legitimacy of any unsolicited contact received with respect to matters of tax or personal finances. Doing so is no longer just prudent, it’s a necessity.

What to do when you can’t pay your tax bill (April 2023)

April 18, 2023

Fortunately for the Canadian taxpayer, most individual income tax returns filed result in the payment of a tax refund to the tax filer. Notwithstanding, a significant number of taxpayers find, on completing the annual tax return, that money is owed to the Canada Revenue Agency. Of the returns for the 2022 tax year that were filed between mid-February and mid-March this year, over half a million taxpayers found themselves in that position. It’s likely, as well, that those who owe money on filing aren’t eager to file early, and so the number of taxpayers who must pay a tax balance for 2022 will almost certainly increase significantly between now and the payment deadline of May 1, 2023.

While receiving a refund is the best possible outcome, the worst-case scenario for all taxpayers is to find out that they are faced with a large tax bill and an imminent payment deadline, and that they just don’t have the money to make the required payment by that deadline. Right now, many Canadians are already living with significant financial constraints, as they cope with both inflationary increases in the cost of household goods (especially groceries) and the impact of eight successive increases in interest rates since this time last year.

For the many Canadians who don’t have the means to pay a tax bill out of existing resources, that can mean borrowing the needed funds. And, while that will mean paying interest on the borrowing, the interest cost incurred will likely be less than that which would be levied by the Canada Revenue Agency on the unpaid tax bill.

Where, however, a tax bill can’t be paid in full out of either current resources or available credit, the Canada Revenue Agency is open to making a payment arrangement with the taxpayer. While, like most creditors, the CRA would rather get paid on time and in full, its ultimate goal is to collect the full amount of taxes owed. Consequently, the Agency provides taxpayers who simply can’t pay their bill for the year on time and in full with the option of paying an amount owed over time, through a payment arrangement.

There are two avenues available to taxpayers who want to propose a payment arrangement with the CRA. The first is a call to the Agency’s automated TeleArrangement service at 1-866-256-1147. When making such a call, it is necessary for the taxpayer to provide his or her social insurance number, date of birth, and the amount entered on line 15000 of the last tax return for which the taxpayer received a Notice of Assessment. For taxpayers who are up to date on their tax filings, that will be the Notice of Assessment for the return for the 2021 tax year. The TeleArrangement Service is available Monday to Friday, from 7 a.m. to 10 p.m., Eastern time.

Taxpayers who would rather speak directly to a CRA employee can call the Agency’s debt management call centre at 1-888-863-8657 or can complete an online form (available at https://apps.cra-arc.gc.ca/ebci/iesl/showClickToTalkForm.action) requesting a callback from a CRA agent.

No matter what payment arrangement is made, the CRA will levy interest charges on any amount of tax owed for the 2022 tax year which is not paid on or before May 1, 2023. Interest charges levied by the CRA tend to add up quickly, for two reasons. First, the interest rate charged by the CRA on outstanding tax amounts is, by law, higher than current commercial rates – the rate which will be charged from April 1 to June 30, 2023 is 9.0%. Second, interest charges levied by the CRA are compounded daily, meaning that each day interest is levied on the previous day’s interest charges. It is for these reasons that a taxpayer is, where at all possible, likely better off arranging private borrowing in order to pay any taxes owing by the May 1 deadline.

Finally, regardless of the taxpayer’s financial circumstances, there is one strategy which is always ill-advised. Taxpayers who can’t pay their tax bill by the deadline sometimes conclude that there is no point in filing if payment can’t be made. Those taxpayers are wrong. Where an amount of tax is owed and the return isn’t filed on time, there is an immediate tax penalty imposed of 5% of the outstanding tax amount – and interest charges start accruing on that penalty amount (as well as on the outstanding tax balance) immediately. For each full month that the return isn’t filed, a further penalty of 1% of the outstanding tax amount is charged, to a maximum of 12 months. Higher penalty amounts are charged, for a longer period, where the taxpayer has incurred a late-filing penalty within the past three years. In all cases, no matter what the circumstances, the right answer is to file one’s tax return on time. This year, for most taxpayers, that means filing on or before Monday May 1, 2023. For self-employed taxpayers (and their spouses) the filing deadline is Thursday June 15, 2023. However, for all taxpayers, the payment deadline for all 2022 income tax amounts owed is Monday May 1, 2023.

Detailed information on the options available to taxpayers who can’t pay their taxes on time and in full can be found on the CRA website at https://www.canada.ca/en/revenue-agency/services/payments-cra/individual-payments.html.

Avoiding (or minimizing) the OAS clawback (April 2023)

April 18, 2023

There are a number of income sources available to Canadians in retirement. Those who participated in the work force during their adult life will have contributed to the Canada Pension Plan and will be able to receive CPP retirement benefits as early as age 60. Earning employment or self-employment income will also have entitled those individuals to contribute to a registered retirement savings plan (RRSP). A shrinking minority of Canadians will be able to look forward to receiving benefits from an employer-sponsored pension plan.

Each of those income sources requires that an individual have made contributions during his or her working life in order to enjoy benefits in retirement. The fourth major source of retirement income for Canadians – the Old Age Security program – does not. Entitlement to OAS is based solely on the number of years of Canadian residence, and individuals who are resident in Canada for 40 years after the age of 18 can receive full OAS benefits. As of the first quarter of 2023, the full OAS benefit for individuals under the age of 75 is $687.56 per month.

The OAS program is distinct from other sources of retirement income in another, less welcome way, in that it is the only such income source for which the federal government can require repayment by the recipient. That repayment requirement comes about through the OAS “Recovery Tax”, which is universally known as the OAS “clawback”.

While the rules governing the administration of the clawback can be confusing, the concept is a (relatively) simple one. Anyone who received OAS benefits during 2022 and had income for that year of more than $81,761 must repay a portion of the benefits received. That repayment, or clawback, is administered by reducing the amount of OAS benefits which the individual receives during the next benefit year.

For example, an individual who receives full OAS during 2022 and has net income for the year of $95,000 will be subject to the clawback. He or she must repay OAS amounts received at a rate of 15 cents (or 15%) of every dollar of income over the clawback income threshold, as in the following simplified example:

Total OAS benefit for the year: $8,200

Total income for the year: $95,000

OAS income clawback threshold: $81,761

Income over clawback threshold: $13,239 times 15% = $1,985.85

Repayment amount required: $1,985.85

The federal government becomes aware of an individual’s income for 2022 only once the tax return for that year is filed, usually by May 1, 2023. At that time, it will become apparent that $1,985.85 in OAS benefits received must be repaid. Consequently, in the following benefit year (which will run from July 2023 to June 2024), OAS benefits received will be reduced by $165.48 per month ($1,985 divided by 12 months).

The OAS clawback affects only individuals who have an annual income of at least $81,761, and it’s arguable that at such income levels, the clawback requirement does not impose any real financial hardship. Nonetheless, the OAS clawback is a perpetual irritant to those affected, perhaps because of the sense that they are being penalized for being disciplined savers, or good managers of their finances during their working years, in order to ensure a financially comfortable retirement.

While any sense of grievance can’t alter the reality of the OAS clawback, there are strategies which can be put in place to either minimize or, in some cases, entirely eliminate one’s exposure to that clawback. Some of those planning considerations are better addressed earlier in life, prior to retirement, However, it’s not too late, once one is already receiving OAS, to make arrangements to avoid or minimize the clawback.

In all cases, no matter what strategy is employed, the goal is to “smooth” one’s income from year to year, so that net income for each year comes in under the OAS clawback threshold and, not incidentally, minimizes exposure to the higher federal and provincial income tax rates which apply once income exceeds around $100,000.

The starting point, for taxpayers who are approaching retirement, is to determine how much income will be received from all sources during retirement, based on CPP and OAS entitlement, any savings accrued through an RRSP, and any amounts which may be received from a private pension plan. Anyone who has an RRSP must begin receiving income from that RRSP in the year after that person turns 71. However, it’s possible to begin receiving income from an RRSP at any time. Similarly, an individual who is eligible for CPP retirement benefits can begin receiving those benefits anytime between age 60 and age 70, with the amount of monthly benefit receivable increasing with each month receipt is deferred. The same calculation applies to OAS benefits, which can be received as early as age 65 or deferred up until age 70.

Once the amount of annual income is determined, strategies to smooth out that income can be put in place. Those strategies can include receiving income from an RRSP prior to age 71, so as to reduce the total amount within the RRSP and so thereby reduce the likelihood of having a large “bump” in income when required withdrawals kick in at that time.

Taxpayers are sometimes understandably reluctant to take steps which they view as depleting their RRSP savings, but receiving income from an RRSP doesn’t mean spending that income. While tax has to be paid on any withdrawals (no matter what the taxpayer’s age), the after-tax amounts can be contributed to the taxpayer’s tax-free savings account (TFSA), where they can compound free of tax. And, when the taxpayer has need of those funds, in retirement, they can be withdrawn free of tax and, they won’t count as income for purposes of the OAS clawback.

Taxpayers who are married can also “even out” their income by using pension income splitting, so that neither of them has sufficient income to be affected by the clawback. Using pension income splitting, the spouse who has income over the OAS clawback threshold re-allocates the “excess” income to his or her spouse on the annual return, and that income is then considered to be income of the recipient spouse, for purposes of both income tax and the OAS clawback. To be eligible for pension income splitting, the income to be reallocated must be private pension income, which is generally income from an RRSP or registered retirement income fund (RRIF), or from an employer-sponsored pension plan.

There are two reasons why pension income splitting is a particularly attractive strategy for avoiding or minimizing the OAS clawback. First, there is no need to actually change the source or amount of income received by each spouse, as the reallocation of income is “notional”, existing only in the return for the year. Second, no decision has to be made on pension income splitting until it’s time to file the return for the previous year, meaning that spouses can easily calculate exactly how much income has to be reallocated in order to avoid the clawback, and to reduce tax liability generally. More information on the kinds of income eligible for pension income splitting, and the mechanics of the process, can be found on the CRA website at https://www.canada.ca/en/revenue-agency/services/tax/individuals/topics/pension-income-splitting.html.

Detailed information on the OAS clawback is available at https://www.canada.ca/en/services/benefits/publicpensions/cpp/old-age-security/repayment.html.

Federal government announces OAS payment amounts for second quarter of 2023

April 6, 2023

Old Age Security (OAS) benefits paid monthly to eligible Canadians are indexed to inflation on a quarterly basis, meaning that such benefit amounts increase to reflect that indexing at the beginning of each calendar quarter.

The federal government has announced the full OAS benefit amounts which will be paid during the second quarter of 2023 (April to June). Such benefit amounts will be indexed by 0.5%, meaning that the full monthly benefit for recipients under the age of 75 will be $691.00. Individuals aged 75 and older will receive $760.10.

Details of OAS and Guaranteed Income Supplement amounts which will be paid during the second quarter of 2023 can be found on the federal government website at https://www.canada.ca/en/services/benefits/publicpensions/cpp/old-age-security/payments.html.

Penalty and interest waiver available for Underused Housing Tax returns

April 6, 2023

The federal government imposes a 1% annual Underused Housing Tax (UHT) on the ownership of vacant or underused housing in Canada. While the tax usually applies to non-resident, non-Canadian owners it can, in some situations, also apply to Canadian individuals and corporations. Those subject to the UHT are required to file a return for that tax for each property owned on December 31, 2022, and that return is due on or before April 30, 2023.

The Canada Revenue Agency has announced that, as a transitional measure, it will be providing a waiver of any penalties and interest with respect to UHT for the 2022 calendar year. This transitional relief means that although the deadline for filing the UHT return and paying the UHT payable is still April 30, 2023, no penalties or interest will be applied for UHT returns and payments that the CRA receives before November 1, 2023.

More information on the UHT can be found on the CRA website at Canada.ca/cra-uht, and the announcement of the transitional relief measures can be found on the same website at Underused Housing Tax penalties and interest waived – Canada.ca.

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2023 March Tax news

Table of Contents

Prescribed interest rates for first half of 2023

March 31, 2023

The Canada Revenue Agency has announced the interest rates which will apply to amounts owed to and by the Agency for the first half of 2023, as well as the rates that will apply for the purpose of calculating employee and shareholder taxable benefits.

Debit rate Credit rate Shareholder Benefits

January 1 – March 31 8% 4%/6% 4%

April 1 – June 30 9% 5%/7% 5%

Additional details of interest rates charged and paid by the Canada Revenue Agency can be found on the CRA website at https://www.canada.ca/en/revenue-agency/services/tax/prescribed-interest-rates.html.

CRA resumes debt collection activities

March 31, 2023

Where the Canada Revenue Agency (CRA) owes an amount to the taxpayer (such as a tax refund), the Agency has the right to deduct from that amount any debts owed by the taxpayer to the federal government (including debts related to pandemic benefits). Taking such offsetting deductions was in previous years part of the Agency’s debt collection processes.

In 2020 the CRA suspended that particular debt collection practice, in recognition of the difficult financial circumstances faced by many taxpayers during the pandemic. In a recent Tax Tip, however, the Agency confirmed that where a taxpayer owes money to the federal government, his or her tax refund for the 2022 tax year (as well as most other amounts owed to the taxpayer by the Agency) may be reduced by the amount of such debts.

Details of the CRA’s debt collection policies, including some limited exceptions, are outlined in the Tax Tip, which is available on the CRA website at https://www.canada.ca/en/revenue-agency/news/newsroom/tax-tips/tax-tips-2023/cra-would-like-remind-you-it-has-resumed-debt-recovery-activities.html.

Federal Budget 2023

March 29, 2023

More information can be found on Government of Canada web site Budget 2023 — A Made-in-Canada Plan: Strong Middle Class, Affordable Economy, Healthy Future

Deduction for Tradespeople’s Tool Expenses

Budget 2023 proposes to double the maximum employment deduction for tradespeople’s and apprentice mechanics’ tools from $500 to $1,000, effective for 2023 and subsequent taxation years.

Registered Education Savings Plans

Budget 2023 proposes to increase limits on certain RESP withdrawals from $5,000 to $8,000 for full-time students, and from $2,500 to $4,000 for part-time students. Budget 2023 also proposes to allow divorced or separated parents to open a joint RESP for their children. These changes would come into force on March 28, 2023.

Registered Disability Savings Plans

Budget 2023 proposes to extend the qualifying family member measure (which allows a family member to open an RDSP for an adult relative) by three years, to December 31, 2026. Siblings will also be qualified family members, as of Royal Assent.

Strengthening the Intergenerational Business Transfer Framework

Budget 2023 proposes to amend the rules introduced by Bill C-208 to ensure that they apply only where a genuine intergenerational business transfer takes place. To provide flexibility, it is proposed that taxpayers who wish to undertake a genuine intergenerational share transfer may choose to rely on one of two transfer options:

an immediate intergenerational business transfer (three-year test) based on arm’s length sale terms; or
a gradual intergenerational business transfer (five-to-ten-year test) based on traditional estate freeze characteristics (an estate freeze typically involves a parent crystalizing the value of their economic interest in a corporation to allow future growth to accrue to their children while the parent’s fixed economic interest is then gradually diminished by the corporation repurchasing the parent’s interest).

Budget 2023 also proposes to provide a ten-year capital gains reserve for genuine intergenerational share transfers that satisfy the above proposed conditions.

These measures would apply to transactions that occur on or after January 1, 2024.

General Anti-Avoidance Rule (“GAAR”)

Budget 2023 proposes to amend the GAAR by:

introducing a preamble;
changing the avoidance transaction standard;
introducing an economic substance rule;
introducing a penalty; and
extending the reassessment period in certain circumstances.

Alcohol Excise Duty

Budget 2023 proposes to temporarily cap the inflation adjustment for excise duties on beer, spirits, and wine at two per cent, for one year only, as of April 1, 2023. The excise duty rates on all alcoholic beverage products as of April 1, 2023, are presented in the table below.

Proposed Alcohol Excise Duty Rates as of April 1, 2023

Rates 2022-23 Rates 2023-24 (no cap) Rates 2023-24 (2% adjust)

Spirits $13.042 $13.864 $13.303

Wine $0.688 $0.731 $0.702

Beer $34.820 $37.014 $35.516

Inflation rate for February 2023 at 5.2%

March 25, 2023

The most recent release of Statistics Canada’s Consumer Price Index puts the overall rate of inflation for the month of February 2023 at 5.2%, as compared to the 5.9% rate recorded for January. Both rates are as measured on a year-over-year basis.

The impact on consumers of price increases in essential goods was mixed. The price of gasoline declined by 4.7%, the first such yearly decline recorded since January of 2021. However, the cost of food purchased from stores rose 10.6% in February (as measured on a year-over-year basis) which, as noted by StatsCan, marked the seventh consecutive month of double-digit increases in food prices.

Details of the inflation picture for the month, by index component and by province, can be found in the March release of the Consumer Price Index, which is available on the StatsCan website at https://www150.statcan.gc.ca/n1/daily-quotidien/230321/dq230321a-eng.htm?HPA=1&indid=3665-1&indgeo=0.

Quebec Budget 2022-2023

March 22, 2022

More information can be found on Revenu Quebec web site Budget 2022-2023, Ministère des Finances – Page d’accueil (gouv.qc.ca)

Investment income

March 19, 2023

Interest income and foreign dividends from securities is fully taxable, capital gains get preferential tax treatment and is 50% taxable, and Canadian dividends also get preferential tax treatment and get a dividend tax credit. The actual tax rate on investment income is based on your tax bracket.

More information can be found on CRA web site Investment income – Canada.ca

More information can be found on Revenu Quebec web site Line 130 – Interest and other investment income | Revenu Québec (revenuquebec.ca)

April 1 launch of Tax-Free First Home Savings Account program

March 17, 2023

As part of the 2022 Federal Budget, the federal government introduced the Tax-Free First Home Savings Account (FHSA). The FHSA allows eligible taxpayers to contribute $8,000 per year (to a lifetime maximum of $40,000), and to deduct contributions made from income. Where accumulated contributions are withdrawn and used to purchase a home, no tax is payable on the withdrawal.

Deductions for contributions to an FHSA can be made starting with the 2023 tax year, and it will be possible to set up such plans with a Canadian financial institution as of April 1, 2023. The most recent information posted on the new FHSA can be found on the Finance Canada website at https://www.canada.ca/en/department-finance/news/2022/08/design-of-the-tax-free-first-home-savings-account.html.

Date announced for 2023-24 Federal Budget

March 17, 2023

The Minister of Finance has announced that the 2023-24 Federal Budget will be brought down on Tuesday March 28, 2023, at around 4 p.m. EST. The media release providing the budget date can be found on the Finance Canada website at Government of Canada to release Budget on March 28, 2023 – Canada.ca.

Once the budget measures are announced, the budget papers will be made available on the same website at Federal Budget – Canada.ca.

Seniors Tax Benefits

March 17, 2023

Quebec Residents

What tax credits are there for people 60 or over, 65 or over or 70 or over? There are a number of tax benefits based on your age at the end of the year. For example:
- Once you turn 60, you can claim the tax credit for career extension if you earned eligible work income.Once you turn 65, you may be eligible for:
  - the age amountthe deduction for retirement income transferred to a spousethe grant for seniors to offset a municipal tax increase
  Once you turn 70, you can claim the following refundable tax credits:
  - the tax credit for home-support services for seniorsthe independent living tax credit for seniorsthe senior assistance tax creditthe tax credit for seniors’ activities (the registration fees must have been paid before December 31, 2022)
Note that conditions apply for all these tax benefits.
https://justepourtous.revenuquebec.ca/en/profiles/seniors/
https://www.revenuquebec.ca/en/citizens/your-situation/seniors/

Canada

Canada Pension Plan Monthly, taxable benefit that replaces part of your income when you retire.
Guaranteed Income Supplement Monthly payment available to low-income Old Age Security pensioners.
Old Age Security Monthly payment you can get if you are 65 and older.

Underused Housing Tax

March 10, 2023

The Underused Housing Tax is an annual 1% tax on the ownership of vacant or underused housing in Canada that took effect on January 1, 2022. The tax usually applies to non-resident, non-Canadian owners. In some situations, however, it also applies to Canadian owners.

Underused Housing Tax – Canada.ca

REPORTING GST AND QST

March 8, 2023

GST/HST-QST RETURN:FPZ-500-V

If you are a registrant, you must file a GST and a QST return for each reporting period, even if you are not entitled to a refund or have no amount payable.

Because the GST and QST are both administered by Revenu Québec, you can use a combined GST/HST-QST return.

https://www.revenuquebec.ca/en/businesses/consumption-taxes/gsthst-and-qst/reporting-gst-and-qst/

The banks also provide a Tax Payment and Filing Service, available through Internet banking, lets you pay and file federal and provincial business taxes online

CRA announces meal and vehicle expense amounts claimable for 2022

March 3, 2023

Taxpayers are entitled to make a claim on their annual return for costs incurred in certain circumstances for meal costs and vehicle expenses. Such costs may, for instance, be claimable by individuals who moved during the year, or who had to travel in order to obtain medical care.

There are two methods by which eligible meal and vehicle expense claims may be calculated – the simplified (or flat-rate) method, and the detailed method, which uses actual costs incurred.

Under either method, the amounts which may be claimed are subject to specific limits, which in some cases vary by province. The amounts which may be claimed on the income tax return for 2022 were recently posted on the Canada Revenue Agency website, and can be found at Meal and vehicle rates used to calculate travel expenses for 2022 – Canada.ca.

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2023 February Tax News

Table of Contents

CRA announces payment deadline for 2022 tax balances

February 17, 2023

The Canada Revenue Agency has announced that the tax payment deadline for individual income taxes owed for the 2022 tax year will be Monday May 1, 2023. While the payment deadline is usually April 30, an extension to May 1 is provided by the CRA where, as is the case this year, the April 30 deadline falls on a weekend.

The May 1 payment deadline applies to all individual taxpayers, regardless of the date by which taxpayers must file their returns for 2022.

The CRA announcement of the payment deadline can be found on the Agency’s website at https://www.canada.ca/en/revenue-agency/services/tax/individuals/topics/important-dates-individuals.html.

Planning for the new First Home Savings Account

February 17, 2023

Just about a year ago, in the 2022-23 budget, the federal government announced a number of measures to help Canadians who are trying to put together a down payment for the purchase a first home. The most significant of those measures was the Tax-Free First Home Savings Account (FHSA) which, as the name implies, allows first time home buyers to save on a tax-assisted basis (within prescribed limits) toward such a purchase.

The FHSA is available to eligible taxpayers starting in the current (2023) tax year. Due to the administrative requirements of putting the new FHSA in place, it will not actually be possible to open such a plan until April 1, 2023. Notwithstanding, Finance Canada has indicated that, for the 2023 tax year, full year contribution limits will apply, regardless of when a new plan is opened during the year.

Under the program terms, any resident of Canada who is at least 18 years of age and who has not lived in a home which he or she owns in any of the current or four previous years can open an FHSA and contribute to that plan annually. Planholders will be able to contribute up to $8,000 per year to their plan, regardless of their income for that year. The $8,000 per year contribution must be made by the end of the calendar year, but planholders will be permitted to carry forward unused portions of their annual contribution limit, to a maximum of $8,000. For example, an individual who contributes $4,000 to an FHSA in 2023 would be allowed to contribute $12,000 in 2024 (representing $8,000 in contribution for 2024 plus $4,000 remaining from 2023). Regardless of the schedule on which contributions are made, there is a lifetime limit of $40,000 in contributions for each individual.

How to respond to a tax instalment notice

February 17, 2023

Sometime during the month of February, millions of Canadians will receive mail from the Canada Revenue Agency. That mail, a “Tax Instalment Reminder”, will set out the amount of instalment payments of income tax to be paid by the recipient taxpayer by March 15 and June 15 of this year.

The CRA’s decision to send an Instalment Reminder to certain taxpayers isn’t an arbitrary one. Rather, an Instalment Reminder is generated when sufficient income tax has not been deducted from payments made to that taxpayer throughout the year. Put more technically, an Instalment Reminder will be issued by the CRA where the amount of tax which was or will be owed when filing the annual tax return is more than $3,000 in the current (2023) tax year and either of the two previous (2021 or 2022) tax years. Essentially, the requirement to pay by instalments will be triggered where the amount of tax withheld from the taxpayer’s income throughout the year is at least $3,000 less than their total tax owed for 2023 and either 2021 or 2022. For residents of Québec, that threshold amount is $1,800.

CRA announces individual tax filing deadline for 2022 returns

February 11, 2023

The Canada Revenue Agency has announced that the filing deadline for individual income tax returns for the 2022 tax year will be Monday May 1, 2023. While the filing deadline is usually April 30, an extension to May 1 is provided by the CRA where, as is the case this year, the April 30 deadline falls on a Sunday.

The May 1 deadline does not apply to self-employed individuals and their spouses, who must file their return for 2022 on or before Thursday June 15, 2023.

The CRA announcement of the filing deadlines can be found on the Agency’s website at https://www.canada.ca/en/revenue-agency/services/tax/individuals/topics/important-dates-individuals.html.

March 1, 2023 deadline for making RRSP contributions for 2022

February 11, 2023

The Canada Revenue Agency has announced that the deadline for making registered retirement savings plan (RRSP) contributions which can be deducted on the return for the 2022 tax year will be Wednesday March 1, 2023.

The CRA announcement of the contribution deadline can be found on the Agency’s website at Due dates and payment dates – Personal income tax – Canada.ca, and detailed information on contributing to an RRSP is available on the same website at https://www.canada.ca/en/revenue-agency/services/tax/individuals/topics/rrsps-related-plans/contributing-a-rrsp-prpp.html.

CRA issues individual income tax return package for 2022

February 3, 2023

The Canada Revenue Agency (CRA) has issued the tax package to be used for the filing of individual income tax returns for the 2022 tax year. That package, which includes both the income tax return and the guide, can be found on the CRA website at https://www.canada.ca/en/revenue-agency/services/forms-publications/tax-packages-years/general-income-tax-benefit-package.html.

Individuals who do not wish to download the tax package from the website can order hard copy to be sent to them by mail. Such orders can be placed online at https://apps.cra-arc.gc.ca/ebci/cjcf/fpos-scfp/pub/rdr?searchKey=2022+Package or by calling the CRA at 1-855-330-3305 (automated service) or 1-800-959 8281 (to reach a customer service agent).

NETFILE service for 2022 returns available February 20

February 3, 2023

The Canada Revenue Agency (CRA) has announced that its NETFILE service for filing of federal individual income tax returns for the 2022 tax year will be available on Monday February 20, 2023.

Information on eligibility for NETFILE and how to use the service can be found on the CRA website at https://www.canada.ca/en/revenue-agency/services/e-services/e-services-individuals/netfile-overview.html. The announcement of the NETFILE opening date for the 2023 tax filing season is available on the same website at Want to avoid delays at tax time? Use our digital services! – Canada.ca.

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2023 January Tax News

Table of Contents

Tax deadlines and limits for the 2023 tax year (January 2023)

January 12, 2023

Each new tax year brings with it a listing of tax payment and filing deadlines, as well as some changes with respect to tax saving and planning strategies. Some of the more significant dates and changes for individual taxpayers for 2023 are listed below.

RRSP deduction limit and contribution deadline

The RRSP current year contribution limit for the 2022 tax year is $29,210. In order to make the maximum current year contribution for 2022 (for which the contribution deadline will be Wednesday March 1, 2023), it will be necessary to have earned income for the 2021 taxation year of $162,275.

Tax-free savings account contribution limit

The tax-free savings account (TFSA) contribution limit for 2023 is increased to $6,500. The actual amount which can be contributed by a particular individual includes both the current year limit and any carryover of uncontributed or re-contribution amounts from previous taxation years.

Taxpayers can find out their personal 2023 TFSA contribution limit by calling the Canada Revenue Agency’s Individual Income Tax Enquiries line at 1-800-959-8281. Those who have registered for the CRA’s online tax service My Account can obtain that information by logging into My Account.

Individual tax instalment deadlines for 2023

Millions of individual taxpayers pay income tax by quarterly instalments, which are due on the 15^th of March, June, September and December 2023.

The actual tax instalment due dates for 2023 are as follows:

Wednesday March 15, 2023
Thursday June 15, 2023
Friday September 15, 2023
Friday December 15, 2023

Old Age Security income clawback threshold

For 2023, the income level above which Old Age Security (OAS) benefits are clawed back is $86,912.

Individual tax filing and payment deadlines in 2023

For all individual taxpayers, including those who are self-employed, the deadline for payment of any balance of 2022 taxes owed is Monday May 1, 2023.

Taxpayers (other than the self-employed and their spouses) must file an income tax return for 2022 on or before Monday May 1, 2023.

Self-employed taxpayers and their spouses must file a 2022 income tax return on or before Thursday June 15, 2023.

Employment Insurance Premiums for 2023 (January 2023)

January 12, 2023

The Employment Insurance premium rate for 2023 is set at 1.63%.

Yearly maximum insurable earnings are set at $61,500, making the maximum employee premium $1,002.45.

As in previous years, employer premiums are 1.4 times the employee premium. The maximum employer premium for 2023 is therefore $1,403.43.

Québec Pension Plan contributions for 2023 (January 2023)

January 12, 2023

The Québec Pension Plan contribution rate for 2023 is set at 6.40% of pensionable earnings for the year.

Maximum pensionable earnings for the year will be $66,600, and the basic exemption is unchanged at $3,500.

The maximum employer and employee contributions to the plan for 2023 will be $4,038.40 each.

For more information : Retraite Québec – Québec Pension Plan (gouv.qc.ca)

Canada Pension Plan Contributions for 2023 (January 2023)

January 12, 2023

The Canada Pension Plan contribution rate for 2023 is set at 5.95% of pensionable earnings for the year.

Maximum pensionable earnings for the year will be $66,600, and the basic exemption is unchanged at $3,500.

The maximum employer and employee contributions to the plan for 2023 will be $3,754.45 each, and the maximum self-employed contribution will be $7,508.90.

For more information Canada Pension Plan – Overview – Canada.ca

Federal individual tax credits for 2023 (January 2023)

January 12, 2023

Dollar amounts on which individual non-refundable federal tax credits for 2023 are based, and the actual tax credit claimable, will be as follows:

Credit amount Tax credit

Basic personal amount* $15,000 $2,250

Spouse or common-law partner amount $15,000 $2,250

Eligible dependant amount* $15,000 $2,250

Age amount $8,396 $1,259.40

Net income threshold for erosion of age credit $42,335

Canada employment amount $1,368 $205.20

Disability amount $9,428 $1,414.20

Adoption expenses credit $18,210 $2,731.50

Medical expense tax credit income threshold amount $2,635

*For taxpayers having net income for the year of more than $165,430, amounts claimable for the basic personal amount, the spousal amount and the eligible dependant amount for 2023 may differ

Federal individual tax rates and brackets for 2023 (January 2023)

January 12, 2023

The indexing factor for federal tax credits and brackets for 2023 is 6.3%. The following federal tax rates and brackets will be in effect for individuals for the 2023 tax year.

Income level Federal tax rate

$15,000 – $53,359 15.0%

$53,360 – $106,717 20.5%

$106,718 – $165,430 26.0%

$165,431 – $235,675 29.0%

Over $235,675 33.0%

Canada Pension Plan retirement benefit amounts for 2023

January 6, 2023

The federal government has announced the amounts which may be paid as benefits under the Canada Pension Plan (CPP) during 2023. The amount of retirement benefit receivable by an individual is based on contributions made, but such benefits are also indexed to inflation. The indexing rate as of January 2023 is 6.5%.

For 2023, the maximum monthly retirement benefit which may be received for new benefits (those starting in January 2023) is increased to $1306.57, and changes have also been made to other types of benefits payable under the CPP.

Details of the maximum amounts payable under the Canada Pension Plan as of January 2023 can be found in the federal government release, which is available at isp-card-jan-march-2023-en.pdf (canada.ca).

Old Age Security benefit amounts for first quarter of 2023

January 6, 2023

The federal government has announced the amounts which will be paid to recipients of Old Age Security benefits for the first quarter of 2023. Such benefit amounts are indexed quarterly, based on the changes in the Consumer Price Index.

For the January to March 2023 period, the maximum OAS benefit payable to recipients who are under the age of 75 is $687.56. Recipients who are aged 75 and older can receive a maximum monthly benefit of $756.32.

Details of OAS and related benefits payable during the first quarter of 2023 can be found on the federal government website at isp-card-jan-march-2023-en.pdf (canada.ca).

Prescribed interest rates for first quarter of 2023

December 17, 2022

The Canada Revenue Agency has announced the interest rates which will apply to amounts owed to and by the Agency for the first quarter of 2023, as well as the rates that will apply for the purpose of calculating employee and shareholder taxable benefits.

Debit rate Credit rate Shareholder Benefits

January 1 – March 31 8% 4%/6% 4%

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2022 Expert Fiscaliste Office

We have moved March 31, 2022 to:

1250 René Lévesque Boulevard West, Suite 2200, Montreal, H3B 4W8

https://www.google.com/maps/dir/Le+1000,+Rue+De+La+Gaucheti%C3%A8re+Ouest,+Montreal,+QC/45.4974,-73.571/@45.4979958,-73.5700778,18z/data=!3m1!4b1!4m8!4m7!1m5!1m1!1s0x4cc91a5d1e4ad471:0x2a7ae0418488f904!2m2!1d-73.5667082!2d45.4984302!1m0

About Expert Fiscaliste

Expert Fiscaliste provides income tax preparation and consulting services to individuals and businesses to obtain Maximum Tax Benefits.

If you want to take advantage of our services for your Tax Returns Give us a call at 514-954-9031, or visit our Contact Tax

2022 February Tax news and alerts

Tax news and Alerts cover significant tax developments and changes in the month that affect Canadian individuals and businesses.

Employment Insurance Premiums for 2022 (January 2022)

The Employment Insurance premium rate for 2022 is unchanged at 1.58%.

Yearly maximum insurable earnings are set at $60,300, making the maximum employee premium $952.74.

As in previous years, employer premiums are 1.4 times the employee premium. The maximum employer premium for 2022 is therefore $1,333.84.

Quebec Pension Plan contributions for 2022 (January 2022)

The Quebec Pension Plan contribution rate for 2022 is set at 6.15% of pensionable earnings for the year.

Maximum pensionable earnings for the year will be $64,900, and the basic exemption is unchanged at $3,500.

The maximum employer and employee contributions to the plan for 2022 will be $3,776.10 each.

Canada Pension Plan Contributions for 2022 (January 2022)

The Canada Pension Plan contribution rate for 2022 is set at 5.7% of pensionable earnings for the year.

Maximum pensionable earnings for the year will be $64,900, and the basic exemption is unchanged at $3,500.

The maximum employer and employee contributions to the plan for 2022 will be $3,499.80 each, and the maximum self-employed contribution will be $6,999.60.

Federal individual tax credits for 2022 (January 2022)

Dollar amounts on which individual non-refundable federal tax credits for 2022 are based, and the actual tax credit claimable, will be as follows:

Credit amount Tax credit

Basic personal amount* 14,398 2,159.70

Spouse or common law partner amount* 14,398 2,159.70

Eligible dependant amount* 14,398 2,159.70

Age amount 7,898 1,184.70

Net income threshold for erosion of age credit 39,826

Canada employment amount 1,287 193.05

Disability amount 8,870 1330.50

Adoption expenses credit 17,131 2,569.65

Medical expense tax credit

Income threshold amount 2,479

*For taxpayers having net income for the year of more than $155,625, amounts claimable for the basic personal amount, the spousal amount, and the eligible dependent amount for 2022 may differ.

Federal individual tax rates and brackets for 2022 (January 2022)

The indexing factor for federal tax credits and brackets for 2022 is 2.4%. The following federal tax rates and brackets will be in effect for individuals for the 2022 tax year.

Income level Federal tax rate

$14,398 – $50,197 15%

$50,198 – $100,392 20.5%

$100,393 – $155,625 26%

$155,626 – $221,708 29%

Over $221,708 33%

CRA issues automobile expense deduction limits for 2022

Some of the changes include an increase in the ceiling for capital cost allowances for passenger vehicles, from $30,000 to $34,000. Deductible leasing costs are also increased, from $800 to $900 per month, for new leases entered into. The limit on the deduction of tax-exempt allowances paid by employers to employees who use their personal vehicle for business purposes will increase by two cents per kilometre. Finally, the general prescribed rate used to determine the taxable benefit of employees relating to the personal portion of automobile expenses paid by their employers is also increased by two cents per kilometre.

Detailed information on the rates and limits applicable for 2022 can be found on the CRA website at https://www.canada.ca/en/department-finance/news/2021/12/government-announces-the-2022-automobile-deduction-limits-and-expense-benefit-rates-for-businesses.html.

Access to Canada Worker Lockdown Benefit expanded

Changes have been announced which expand the circumstances in which workers can qualify for the CWLB. Effective as of December 19, 2021 (and until February 12, 2022), the CWLB is available to workers in regions where provincial or territorial governments have introduced capacity-limiting restrictions of 50% or more for a period of at least 7 days, and which result in an income loss for the worker of at least 50%. The benefit amount remains at $300 per week. A current listing of eligible regions for purposes of the CWLB can be found on the federal government website at https://www.canada.ca/en/revenue-agency/services/benefits/worker-lockdown-benefit/cwlb-regional-lockdowns.html.

More information on the program and the most recent changes can be found on the federal government website at https://www.canada.ca/en/department-finance/news/2021/12/temporarily-expanding-eligibility-for-the-local-lockdown-program-and-the-canada-worker-lockdown-benefit.html and https://www.canada.ca/en/department-finance/news/2021/12/government-temporarily-expands-access-to-lockdown-program-and-worker-lockdown-benefit.html.

Old Age Security rates for first quarter of 2022

The amount of Old Age Security (OAS) benefit paid to eligible Canadians is adjusted each quarter to take account of increases in the Consumer Price Index.

Based on recent increases to the Consumer Price Index, the federal government has announced that, for the first quarter (January to March) of 2022, the basic OAS benefit paid will increase by 1.1%, to $642.25.

More information on OAS and related payments during the first quarter of 2022 is available at https://www.canada.ca/en/services/benefits/publicpensions/cpp/old-age-security/payments.html.

Medical Expenses

Medical Expense tax credit is a non-refundable tax credit that you can use to reduce the tax that you paid or may have to pay. If you paid for healthcare expenses, you may be able to claim them as eligible Medical Expenses on your income tax and benefit return.

Additional information of Medical Expenses can be found on the EF website at 2021 Medical Expenses – Expert Fiscaliste (expert-fiscaliste.org)

About Expert Fiscaliste

Expert Fiscaliste provides income tax preparation and consulting services to individuals and businesses to obtain Maximum Tax Benefits.

If you want to take advantage of our services for your Tax Returns Give us a call at 514-954-9031, or visit our Contact Tax

2022 Seasonal Associates

Personal Tax Preparer Position

We are an Expert-Fiscaliste tax preparation based in Downtown Montreal, QC. Are you an experienced tax preparer and looking for seasonal work where you would be compensated well? Do you have experience with Tax Prep? If so, we’d like to have you join our team.

Requirements:

– You must be a seasoned tax preparer with at least 5 years of recent personal tax preparation experience who will mainly be preparing individual Business, and Rental returns,

– Experience in preparing T2125 returns business returns, updating and preparing excel synoptics, and/or working papers,

– Preparation of GST returns,

– Experience in preparing T776 rental income returns, updating and preparing excel synoptics, and/or working papers,

– Fairly fluent with computer technology (i.e. Microsoft Excel, and MS Word skills)

– Strong verbal and written communication skills in both English and French.

– Analytical and problem-solving skills,

– Ability to work in teams, individually and remotely.

– Experience using CCH Tax Prep or CCH iFirm.

Compensation:

Compensation is based on experience. Note that this is a contract position and that the candidate is expected to be in the office 5 days a month. There is a possibility of continuation after the tax season ends.

Salary: Starting at $20/hr to $30/hr

Schedule:

Contract length: 2 months starting March 1 to April 30

Job Types: Part-time, Contract

7 hour shift

Contract length: 2 months

Expected start date: 2022-02-28

5 days a monthly in office balance work remotely

Experience:

Tax Accountants: 6 years (preferred)

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Save Your Tax — Call Expert Fiscaliste at 514-954-9031

At Expert Fiscaliste let us prepare your tax returns for you. Expert Fiscaliste provides Canadian and international income tax preparation and consulting services to individuals, businesses, and trusts.

If you want to take advantage of our services. Give us a call at 514-954-9031, or visit our Contact Tax Experts page.

2021 Medical Expenses

General information

medical supplies and services
dental care
travel expenses
Premiums paid under an insurance plan

Generally, you can claim all amounts paid, even if they were not paid in Canada.

You can only claim the part of an eligible Medical Expense for which you have not been or will not be reimbursed.

Additional details of Medical Expenses can be found on the CRA website at Medical Expe nses 2021 – Canada.ca

Additional details of Medical Expenses can be found on the Revenu Quebec website at Medical Expenses 2021 – Revenu Quebec

About Expert Fiscaliste

Expert Fiscaliste provides income tax preparation and consulting services to individuals with Medical Expenses to obtain tax maximum benefits.

If you want to take advantage of our services for your Tax Returns Give us a call at 514-954-9031, or visit our Contact Tax Experts page.

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June 15, 2023 filing deadline for self-employed taxpayers

Second individual income tax instalment for 2023 due June 15

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GST/HST-QST RETURN:FPZ-500-V

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RRSP deduction limit and contribution deadline

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Old Age Security income clawback threshold

Individual tax filing and payment deadlines in 2023

Employment Insurance Premiums for 2023 (January 2023)

Québec Pension Plan contributions for 2023 (January 2023)

Canada Pension Plan Contributions for 2023 (January 2023)

Federal individual tax credits for 2023 (January 2023)

Federal individual tax rates and brackets for 2023 (January 2023)

Canada Pension Plan retirement benefit amounts for 2023

Old Age Security benefit amounts for first quarter of 2023

Prescribed interest rates for first quarter of 2023

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