On March 19, 2019 the new Federal Budget proposed a variety of tax and non-tax financial measures. There were no changes to personal tax rates, corporate tax rates or the inclusion rate on taxable capital gains. Briefly, here are some of the proposed new Personal Tax and Business Tax changes:
Personal Tax Changes
- Interest rates on Canada Student Loans will be lowered for 2019-20
- Maximum Home Buyers’ Plan (HBP) withdrawal will increase from $25,000 to $35,000
- Parties to a relationship breakdown will have access to the HBP to acquire a new residence
- Enhancing access to Shared Equity Mortgages will be pursued, including the “First-time Home Buyer Incentive” via the Canada Mortgage and Housing Corporation (CMHC)
- Change of use provisions will be modified to allow taxpayer elections to avoid a deemed disposition on a partial change of use of a multi-unit residential property (like converting half a duplex from a principal residence to a rental property or converting one suite in an apartment building to a principal residence)
- 50% Stock Option Benefits Deduction will now have an annual cap of $200,000
- Medical Expense Tax Credit for cannabis has been updated
- New Canada Training Credit, a refundable tax credit for up to half of eligible tuition and fees
- New Employment Insurance EI Training Benefit to provide up to four weeks benefits every four years
- Exemptions for the Guaranteed Income Supplement will be expanded to include self-employment income and increased earnings
TAX TIP Canada Revenue Agency will be creating four new dedicated Real Estate Residential and Commercial Audit Teams in Ontario and BC to ensure:
- taxpayers report all sales of principal residences on their tax returns
- capital gains from real estate sales are properly disclosed
- money made from real estate flipping is reported as income
- earned commissions are reported as taxable income, and
- builders of new residential properties remit the correct GST/HST
Please contact us now for strictly confidential advice with regard to all your real estate matters.
Business Tax Changes
- Small Business Employers will receive rebates to offset EI premium costs for the new Employment Insurance Training Benefit
- Access to the enhanced Scientific Research & Experimental Development (SR&ED) credits will no longer be reduced based on taxable income of Canadian Controlled Private Corporations
TAX TIP Effective March 20, 2019, did you know the new Federal Budget permits a couple to potentially withdraw $70,000 from their RRSPs to purchase a first home? Also, as a result of a breakdown in marriage or common-law relationship, an individual will meet the first-time home buyer requirement provided he/she lives separate and apart at least 90 days after. Please contact us now for professional advice regarding your home purchases.
June 17, 2019 Self-Employed Tax Deadline
Be sure to file your 2018 Self-Employed Individual Income Tax Return now to avoid costly penalties.
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HALPERN Chartered Professional Accounting Firm is a full-service Tax, Accounting, Business Advisory and Financial Planning CPA firm. Accurate and timely information is only one piece of any effective solution. We are dedicated to bringing you all of the pieces together – knowledgeable and innovative advice, leading-edge technology, and a strong relationship with our clients. This type of creative thinking enables us to help you and your business organization to solve complex problems and significantly enhance your ability to improve performance, manage risk and build value.
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