Your Finances Are in Safe Hands - Blogs

Dear Client and Friend,

I’ve been listening to speakers such as Canadian author Malcolm Gladwell and CNN’s Fareed Zakaria on the Munk Debates “The World After COVID19” on Wednesday nights www.munkdebates.com. Here are a couple of take-aways from them: Gladwell said the world just happened to be lucky to have great leaders we trusted during the second world war such as Franklin Delano Roosevelt and Winston Churchill. Zakaria was impressed how Canada’s Trudeau rolled out its $2,000 a month Canada Emergency Response Benefit so quickly to Canadians.  Below I have highlighted Covid-19 relief measures that have been updated, what is down the pike, real time experiences and silver linings.

Dear Client and Friend,

‘Lean On Me’ and ‘Ain’t No Sunshine’ are tunes my family grew up with. Bill Withers passed away this week, may his classics offer comfort to all of us including our health care workers during this pandemic.

Dear Client and Friend,

On Friday, March 27, 2020, the federal government announced additional economic assistance in response to COVID-19. Today, Prime Minister Trudeau provided important details. Below, I have highlighted how you fit in, and when you can expect to receive assistance if deemed eligible. I have included real time experiences along with a new section called Silver Linings.

Dear Client and Friend,

Yesterday the federal government introduced the Canada Emergency Response Benefit (CERB), which replaces the Emergency Care Benefit. This represents broader and simpler assistance to impacted individuals, including the self-employed, who have ceased working for at least 14 days for reasons related to COVID-19.

As in my prior updates, I am keeping you abreast of real-time experiences, this time dealing with HST filing, possible insurance claims from COVID-19, and business continuity webinars provided by my contact at Xero Accounting Software.

I hope you are all making lemonade out of lemons, and doing your part in “physical distancing”, which I prefer to use instead of “social distancing”, because the success of our species is based on being social.

Below I have highlighted the different levels of government, City, Ontario, and Federal,  how and when you can get help. In addition, I have provided real-time experiences from clients, friends and government sources on their success in getting this help at the end of this email.

I am open for business as accounting is considered essential as per the Ontario notice below, and clients are making arrangements with me for drop-offs either in my e-courier drop box below, my secure client portal on my website, or my physical mailbox at home. I encourage everyone to protect any sensitive information they are sending me by email to use my e-courier drop box at the end of this email or my secure portal on my website. This drop off initiates a two-way email exchange between you and me for any sensitive information.

“An investment in knowledge always pays the best interest.”

― Benjamin Franklin

I have always said that an educated client is my best ally. Last week, I attended a number of seminars on the topic of death and taxes. This blog is kicking off my series on this unavoidable topic. Let’s first start with some definitions.

More on the Federal Budget 2019

Easier Access to Scientific Research & Experimental Development Program (SRED)

• Canadian controlled private corporations (CCPCs) are entitled to a very generous refundable tax credit of 35% on qualifying annual SRED expenditures, up to a maximum of $3 million of expenditures.
• A CCPC is a private corporation, not public which is traded on the stock exchange, and is controlled by a Canadian resident. A Canadian resident for tax purposes is a question of fact based on residential ties.
• Before the federal budget, the SRED expenditure limit and resulting tax credit were reduced the higher the business income.
• After the budget, a CCPC can get this credit irrespective of income.
• This change also bodes well for companies doing research and development work for climate change.

100% Tax Deduction on New Zero Emission Vehicles up to $55,000

August 17, 2019, Small Business Needs

Even though the big investors are betting for the music to stop with a global downturn, there is a way to keep dancing and weather the storm. They could be wrong about the recession. John Lennon said, “life is what happens when you are busy making other plans”. Although I believe in this adage as well (my creative right side of my brain is to blame), the left side of my brain, the analytical and methodical side, has some tips for the new headwinds.

March 21, 2019, Personal Income Tax

Welcome Spring with a Budget that is a breath of fresh air!
“Protecting the environment and growing the economy go together.”
Government of Canada

December 13, 2018 – Small Business Needs

On November 21st Finance Minister Bill Morneau unveiled the 2018 Fall Economic Statement. Canada’s economy is strong and growing, at 3% it had the strongest economic growth of all Group of Seven (G7) countries in 2017. To continue this growth, Morneau delivered a Christmas mini-budget wrapped with good government and tax breaks. It emphasizes that government has an important role to protect the environment and consumers. Doing business in Canada will be even easier. As my old professor would say, “Tax is a microcosm of life”.

December 13, 2018 – Personal Income Tax

A wise old man said to me once, “A good deed a day is enough, and sometimes it doesn’t hurt to say, say a little prayer to God”. Apart from the reciprocating benefits of doing a good deed, and perhaps getting a nod from God, there are tax benefits too! As my old tax professor would say, “Tax is a microcosm of life”. Here is my list of good deeds this Christmas:

December 13, 2018 – Personal Income Tax

The benefits of taking care of our elderly are indeed reciprocating, both for the caregiver and the loved one. Apart from these precious moments in time, there are tax benefits too! As my old tax professor would say, “Tax is a microcosm of life”.

October 2, 2017 – Small Business Needs

Dear Client,

Let’s face it, taxes are not something the public likes, nor understands. When it comes to taxes, most of you want to know to two things, where do I sign, and how much do I pay? Of course there’s a smile on your face when you get money back ☺.

February 26, 2017 - Personal Income Tax

• RRSP Contribution Deadline Wednesday March 1, 2017.
• Your RRSP deduction limit shows up on you Notice of Assessment for 2015 taxes filed.
• Go to CRA’s Online Service: My Account, click on link below to set up for instant access to some of your tax information.

April 8, 2017 – Personal Income Tax

How much do we each pay for our health care in Ontario?

Health care has been in the news lately south of the border. Our health care in Ontario is paid through our personal tax system. The Ontario Health Premium is included on our pay stubs as part of income tax withheld, but did you know how much? The premium ranges from $0 if your taxable income is $20,000 or less, to $900 if your taxable income is more than $200,600.

April 25, 2016 – Personal Income Tax

What we used to call the “Harper Tax Credits” will disappear after you file your tax return this year. Personally, I don’t think that taking these away is a bad thing because these are things that don’t enhance the productivity of the economy. The federal budget of March 22, 2016 also unveiled a middle class tax cut, a boost to student grants and the guaranteed income supplement for single low income seniors, and a new high tax bracket rate.

Estate Planning Checklist (Part 1)

October 20, 2014 – Personal Income Tax

Do you want to give some of your estate away today during your lifetime to family, friends, and/or charity? – Yes/No

Gifting Your Estate During Your Lifetime – Pros

• You get to see your gift enjoyed.
• Gifting money to young adult children (over the age of 18) lets them invest and pay tax on their returns at lower tax rates if they’re in a lower tax bracket than yours.

Do you want to give some of your estate away today during your lifetime by way of a living trust to those who are entitled to benefit from it, your beneficiaries, such as family, friends, and/or charity, while you still have legal control of those assets? Yes/No

Living Trusts set up during your lifetime – Pros

• Providing For Beneficiaries Who Can’t Manage Assets On Their Own – You can provide for dependants with special needs, beneficiaries of a complicated estate who don’t have the expertise to manage it, management of a minor’s inheritance to be received in a lump sum when he or she reaches 18 by spacing it out, with a living trust.

March 13, 2014 – Personal income Tax

• Safety deposit box payments made after March 20, 2013 are no longer deductible.
• Adoption expense tax credit has been enhanced to claim eligible adoption expenses earlier than before; from the time an application is made for registration with a provincial ministry responsible for adoption. This allows certain expenses such as provincially required home study and fees to complete adoption courses to be claimed.
• A first-time donor super credit is applicable for donations up to $1,000 made after March 20, 2013 to December 31, 2017. First-time donors are defined as follows: neither they nor their spouse or common-law partner have claimed a donation credit since 2007. In terms of tax savings, the super credit is worth an extra 25% on the first $200 of donations, or $50 in extra tax savings, and an extra 25% on the next $800 of donations, or $200 in extra tax savings.

March 13, 2014 – Personal income Tax

1. Minimizing income taxes and other taxes or “probate fees” payable on death.
2. Ensuring liquidity to pay taxes at death, for example, with life insurance, or by paying capital gains tax with instalments over ten years.
3. Providing an orderly transfer of assets to the next generation.
4. Delaying taxes on assets transferred to your spouse.
5. Maintaining control and management over assets transferred.
6. Protecting assets from creditors.
7. Providing income to meet retirement needs.
8. Maximizing after-tax income if disabled and authorizing someone to act on your behalf.