Income Tax

Workspace in Home Claims

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If you worked from home in 2021 due to COVID, you should be prepared to prove your Workspace in Home claim.

Holding Digital Assets in RRSP’s

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Holding digital assets in an RRSP may open you up to higher taxes. If interested in holding digital assets in a tax-sheltered savings account such as an RRSP, make sure that item is a qualified investment.

Life Insurance Policies

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Holding a life insurance policy in a corporation can be a useful tool to assist with continuity upon death of an owner-manager. The use of insurance tracking shares can mitigate increases in capital gains upon death when using such policies.

TFSA Excess Contributions

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CRA does not believe they have the discretion to waive the penalty tax on an excess TFSA contribution. Even where they have that discretion, they often refuse to waive the tax. Care should be afforded to ensure not to make excess TFSA contributions, and if an error is made, it should be corrected as soon as possible.

COVID-19 Medical Expenses

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Although expenses may relate to an individual’s health, they should still be reviewed to determine eligibility for the medical expense tax credit. Collect medical-related expenditures throughout the year such that at personal tax time, we can review whether an expense is eligible or not.

Travel Allowances

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Structure compensation for the employment use of an employee’s vehicle carefully to ensure that any allowance received will not be taxable to the employee. A taxable assessment after the fact can create significant employee/employer issues.

CERB Repayments

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If you repaid CERB but you met certain eligibility criteria, you may be entitled to receive a reimbursement.

Underground Economy

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CRA recently discussed one of their top priorities; identifying those involved in the underground economy and ensuring that they are satisfying their tax obligations. Do you fall within one of these 4 industries identified by CRA?

Rental Properties – Major Repairs

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In a February 11, 2021 Tax Court of Canada case, the deductibility of rental expenses for a condo unit that underwent major repairs was considered. CRA said no, but what did the courts say?