Canada Needs a Financial Plan

According to a July 23 publication by the Fraser Institute, we are getting poorer here in Canada and the prospects for economic growth are looking grim.  This should be of concern to every Canadian concerned about their “real income” – that’s their purchasing power – and by extension - their ability to fund consumption now and for important family milestones in the future:  retirements, education and homeownership.  It’s grim, but there are practical suggestions for a turn around plan. Here’s a synopsis of the report.   

Do you have clients that purchased zero-emission vehicles (such as electric cars)? There are some newer rules to get up to speed on as the government has continued to offer a $5,000 rebate for light-duty, zero-emission vehicle purchases along with the 100% write-off for zero-emission autos purchased by those who can write off the purchase of a vehicle. Here’s what you need to know.

April 30 is an important deadline for more than one reason: late elections for pension income splitting for 2017 expire April 30, 2021 as taxpayers can optimize pension income splitting, but only for up to three years.  Taxpayers who elect to split pension income with a spouse must claim an offsetting deduction on Line 21000 for the elected amount of income that will be reported by the pensioner's spouse. Form T1032 Joint Election to Split Pension Income is used to determine the election. What should professional tax and financial advisors know?

The difference between good and bad debt often lies in its tax deductibility. Those who leverage their assets as part of their strategic plan to build wealth will often do so more successfully by earning more income and increasing their net worth. However, should you borrow to invest? Claiming tax-deductible interest is often the only consolation for the eroding effect that the costs of debt can have on personal wealth. Here’s what you need to know this tax season:

Okay, we admit, it’s a stretch, but we wanted to hop into the spirit, and surprise you, our Knowledge Bureau Report readers, with a tuition treat to celebrate the long weekend!

The Canada Emergency Wage Subsidy (CEWS) program is set to end on June 15, 2021.  Has it been a success?  It depends on your perspective.  Last week, a Performance Audit on this program and the Canada Emergency Response Benefit (CERB) was completed by the Auditor General of Canada and the findings do raise eyebrows.

Taxpayers who are filing 2020 tax returns and need to report a move to a new address will have a new hurdle to overcome in changing their address with the CRA.  This is due to the cyber security incidents dating back to August of 2020.