Koroll & Company Blog

The 2017 Tax Return deadline has been and gone for individual taxpayers, whose spouse or common law partner does not own a business.

In most cases, that means you no longer have to concern yourself with your 2017 return, unless of course the CRA reaches out for more information. In some cases, however, you may notice that you filed your return with an unintentional error or omission. 

With spring on it’s way, many Canadians are getting ready to sell their home. While selling your home can come with many costs, one cost you won’t have to worry about is paying tax on your principal residence.

Unlike most income we earn throughout the year, neither the income earned from the sale of your home or the capital gain will be taxed when you file your annual tax return, so long as that home was your principal residence. Given the growth we have been seeing in the value of homes across Canada, this can be a substantial amount of income in your pocket.

Previously, we discussed proposed changes to passive investment income earned by private corporations detailed in the 2018 Federal Budget.

The changes proposed two new measures. The first is a reduction of the business limit for passive income earned over a specific threshold and the second will limit the refundability of taxes paid on investment income. 

Each year, the government of Canada releases a Budget that outlines planned spending and expected government revenue, as well as the current and expected economic positions and conditions.

In addition to new tax legislation for individuals, business and charities, the 2018 Budget brings forth extensive reporting requirements for Canadian-resident express trusts, including most family trusts, and non-resident trusts.

The 2018 Budget brought forth a number of changes to individuals, families and for-profit businesses. In addition to these amendments, changes to the taxation and registration of certain charities have also been proposed.

The 2018 Federal Budget brings forth several changes that could affect you both as an individual taxpayer and as a business owner.

For information on changes related to individual taxpayers, read our blog – 2018 Canada Federal Budget Commentary - Part 1: INDIVIDUALS and FAMILIES.

Looking at the Budgets proposed changes, in terms of businesses, the following will discuss several changes that could affect your company’s tax planning strategy on a go forward basis. While there are many new proposals, some of the proposed measures, such as alterations to the management of passive investment income and income sprinkling, may be familiar to you, as they were originally introduced in 2017.

Just last month, the Government of Canada released the 2018 Federal Budget which showed a strong economic growth. Canada saw GDP growth of 3.2% along with a low unemployment rate of 5.9% and improvements in consumer confidence, average weekly earnings and household consumption.

While there was much speculation about what this Budget would bring, from a personal tax perspective, many were not introduced/reintroduced in the 2018 Federal Budget.