SMES: Carbon Tax Rebates on the Way?

July 15 was an important day for carbon-tax weary taxpayers. A Canada Carbon Rebate payment was  made to individuals who have filed their 2023 personal tax returns.  What about the long-awaited $2.5 billion Carbon Tax Rebate For Small Businesses? The delivery date and amounts to be received remain elusive, but one thing is clear: many businesses will have disqualified themselves by missing the July 15 date for filing 2023 T2 returns.  Here’s what you need to know. 

Best-selling author Doug Nelson, CFP, CLU, MFA™, RWM™, CIM, is a 27-year veteran of the financial services industry in Canada with a singular vision for his readers:  Don’t just “do” retirement…instead “Master Your Retirement”!  He wow’d the audience at the Virtual CE Summits on May 18, and he has some upbeat advice for those still worried about the one big question all retirees have. 

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By May 3, the CRA received a total of 25,857,885 returns filed by Canadians – 94% of them electronically - which is 83% of the total returns filed last year. The average tax refund is $1,987: a jump from last year’s average of $1,878.  What that means is that the CRA is increasingly holding on to more of Canadians’ money throughout the year – about $165 a month – which could be put to good use in inflationary times.  With 17% of returns left to file in advance of the June 15 deadline for proprietorship, it’s also important to note that those filers who owe so far have also paid a substantial chunk.

Unfortunately, even as interest rates rise in Canada, there are new restrictions in interest deductibility on the horizon.  Re-introduced on February 4, 2022, a 2021 federal budget proposal will limit interest deductibility and financing expenses for certain taxpayers based on a percentage of earnings before interest, taxes, depreciation and amortization (EBITDA).  The rules are expected to come into effect after December 31, 2022.  The new rules will be known as the Excessive Interest and Financing Expenses Limitation (EIFEL) and comments are to be submitted to Finance Canada this week by May 5.

There are more tax filing milestones in sight, and tax and financial professionals will want to ensure their clients are reminded of them now with Knowledge Bureau’s handy checklist.  Most important is the June 15 tax filing deadline for those with unincorporated businesses.  But there are other important dates too.  Here are some important dates and deadlines coming up to make note of in May and June!

How maxed out is your time?  Most business owners struggle with this question – too much to do, too little time.  To prioritize, especially after tax season, consider:  are you spending more time working on the creation of income or the creation of wealth?  They are conjoined for sure, but by executing on financial priorities that are critical in all the important spheres in your life –in a healthy balance – you will likely achieve more of both.