CRA Review Letters and Initiatives: What is required?

Review Letters CRA regularly conducts a number of review activities to ensure compliance with tax laws since Canada’s tax system is based on self-assessment. This means that individuals voluntarily complete their income tax returns to report their annual income and deductions or credits, ultimately leaving individuals to calculate the amount owing or the refund to…

Eligible Capital Property

Effective January 1, 2017 the Eligible Capital Property regime has been repealed and replaced with new capital cost allowance (CCA) class.   Expenditure will be added to the new CCA class and CCA rules will generally apply, including recapture, capital gains, and depreciation. Planning Opportunity Additions to CEC are not subject to half-year rule, but additions…

Does your operating corporation pay dividends to a parent (holding) corporation?

Generally speaking, taxable Canadian corporations can pay dividends to other taxable Canadian corporations on a tax-free basis.  For instance, consider a typical corporate structure where an operating company (Opco) is wholly owned by a parent corporation (Holdco), which in turn is owned by individual shareholders.  A common practice used by many accounting practitioners is to…

Do the new mortgage rules affect you?

Effective October 17, 2016, all high-ratio mortgages (those where a borrower puts less than 20% down) must satisfy a mortgage stress test.  Essentially, a borrower must now qualify using a higher interest rate notwithstanding the fact that their lender is currently offering mortgages at a lesser rate. Q: What interest rate must now be used…

A Note from Quentin D. Gardiner

There’s been much discussion south of the border about the clash between the left and the right on the political spectrum. We’ve had similar examinations here in Alberta. I’ve been politically charged at times on various social media platforms. To be frank, I’m not that aligned with the hard right, and I find it unfortunate that…