Koroll & Company Blog

The Government of Canada has announced that some self-employed Canadians who were ineligible to receive the Canada Emergency Response Benefit (CERB), and received it anyway, will not be forced to repay the money.

In a statement released in February, the federal government said that self-employed Canadians who applied for, and received CERB payments based on their gross income instead of their net income would not be required to repay the benefit on their 2020 tax year return - as long they also met all other eligibility criteria.

If you were affected by the 2020 COVID-19 lockdowns and received the CERB (Canada Emergency Response Benefit) you may have a large tax bill coming your way. 

When you receive employment income, taxes are deducted at the source and sent to the government on your behalf. This pay as you go program stops you from owing large amounts come the new year. 

The Department of Finance Canada has announced the automobile income tax deduction limits and expense benefits rates for 2021, which will remain largely the same as 2020 with the exception of one change that came into effect on January 1, 2021.

Employees working from home is not a new phenomenon, but with COVID-19, it has become less of a perk and more of a necessity. 

In response, the government has introduced a simplified process for claiming home office expenses. But before we get to that, let’s look at the home office deduction that was claimed in past years. 

When CERB was first released, the government wanted to get it out as quickly as possible so that Canadians would have the support they needed. But that meant eliminating validation checks to speed up the process. 

The problem is validation is a necessary step to ensure nobody took advantage of a program that was meant to support the millions of Canadians who lost their jobs. 

Now that we’re in the new year, it’s too late to maximize most of your tax credits and deductions for your 2020 tax return. There is, however, one tool remaining that you can use to minimize your tax owing from 2021 and that’s RRSP (registered retirement savings plan) contributions. 

As of July 1, 2021, new rules will be imposed on employee stock options. 

Employee stock options are a form of compensation that some companies offer their employees. They give an employee the right to buy a specific number of shares at a pre-set price. But they must be purchased within a specific time frame. 

Every year the government announces the new contribution limit for tax-free savings accounts (TFSAs). For 2021 the amount will be $6,000 – the same amount set in both 2019 and 2020. Contribution room is carried forward each year. That means the total contribution of someone who has been eligible since the introductions of TFSAs in 2009 and has never contributed is $75,500.