Archives: Answers

Answer

Re: Can my parent benefit from systematic withdrawal plan?

A systematic withdrawal plan works by selling a portion of your mutual funds to give you the set amount you have requested. With an RRIF, there is a minimum amount that you must withdraw each year. Keeping the requested amount as low as possible is the best way to keep the taxes down. Also, you … Continue reading Re: Can my parent benefit from systematic withdrawal plan?

Do I have to provide a T4 for my employees if I pay cash?

You must provide a T4 if any of the following conditions are met: You deducted income for CPP/QPP contributions, EI premiums, income tax, or Québec PPIP premiums The payment was more than $500 Assuming you did not pay your cousin more than $500, you do not have to use a T4. Your cousin would then … Continue reading Do I have to provide a T4 for my employees if I pay cash?

Re: What is the deadline for the self employed to file taxes?

The deadline to file taxes for the self employed was June 16, 2014. If you haven’t already done so, you need to file as soon as possible as you may face a late filing penalty of 5% on whatever balance you owe in addition to another 1% per month for every full month you don’t … Continue reading Re: What is the deadline for the self employed to file taxes?

Can i still claim elligible dependent for my child if he works and goes to school?

You cannot claim your son as an eligible dependent as per the criteria by the CRA. The requirements needed to be eligible to claim your son as a dependent are: You cannot have a spouse or common law partner within the year you want to claim a dependent; if you did have a spouse they … Continue reading Can i still claim elligible dependent for my child if he works and goes to school?

What are the legalities surrounding donations to charity?

A registered charity should only issue receipts for the actual amount donated. Even if you give the money in good faith, if you claimed the extra $35,000 on the receipt you would be responsible for paying back any refund. This would include any penalties and interest. Only registered charities can issue receipts for income tax … Continue reading What are the legalities surrounding donations to charity?

Can I deduct my student loan on my Income tax return?

You are able to claim the interest you pay on your student loan as long as the loan is from the Canada Student Loans or the Canada Student Financial Assistance program. There are other similar programs for post-secondary education that would meet the requirements as well, it varies on the province or territory you live … Continue reading Can I deduct my student loan on my Income tax return?

What do I do with my properties overseas?

Hello, These expenses are used as part of your adjusted cost base (ACB), which in turn is used to calculate your capital gains. The higher your ACB is, the lower your capital gains and your tax bill. As you have more than one property, make sure you are tracking each one separately. It is normally … Continue reading What do I do with my properties overseas?

Re: Is being reviewed the same thing as being audited? Am I in trouble?

Being audited and being reviewed are not the same thing. A review is a check to see that you claimed your deductions and credits correctly. Although some reviews are purely random, there are several factors that may lead to a CRA review. If you have had a history of non-compliance, or have claimed a higher … Continue reading Re: Is being reviewed the same thing as being audited? Am I in trouble?

Re: How should I give my customer a portion of my earnings? Will a rebate work?

Hello. I would say that paying the rebate as a gift is too dangerous in this case because the CRA can challenge you on your decision. If the amount of the rebate is determined to be unreasonable, they will not allow you to claim it as an expense. The best way to make the payment … Continue reading Re: How should I give my customer a portion of my earnings? Will a rebate work?

Re: Managing Personal Investment Portfolio?

Hello, The choice of reporting method has important tax consequences. Profits as capital gains are only 50% taxable, but as business income they are 100% taxable. If you incur losses, however, the losses are only deductible against capital gains. Business losses are fully deductible against other sources of income. Business profits are also subject to … Continue reading Re: Managing Personal Investment Portfolio?

Do I have to worry about taxes in India if I live in Canada?

That is not the case, her rental income is taxable in both India and Canada. However, there is more to it. The way it works, as per the treaty between Canada and India (see: article 6), income from property such as an apartment will be taxed in the country where it is located, first. Canada … Continue reading Do I have to worry about taxes in India if I live in Canada?

Re: How do savings plans help me defer my tax payments?

Hello, Without knowing your friend’s situation personally, it’s somewhat difficult to recommend a savings plan that will work best. In most cases, however, tax deferral makes sense. Basically, the way deferral works is this. If your friend puts some of their money away now and agree not to touch it, then they pay tax on … Continue reading Re: How do savings plans help me defer my tax payments?

Re: What to do with my RRSP now that I’m turning 71

Hello, When you turn 71, you are required to convert your RRSP’s to another form of retirement income before the end of the year. Collapsing your RRSP’s would normally result in a large tax bill, so most seniors choose to convert their funds in to an RRSP annuity or a Registered Retirement Income Fund (RRIF). … Continue reading Re: What to do with my RRSP now that I’m turning 71

What does it mean to “declare my income?” Do I need a record of every dollar that went into my accounts?

Declaring your income means to give the government a record of what money you’ve made over the last tax year on your personal tax return. Essentially, they are looking for you to provide them with a breakdown of the types of income you made including income from employment, business, investments and taxable government benefits (like … Continue reading What does it mean to “declare my income?” Do I need a record of every dollar that went into my accounts?

Filing my U.S. income tax from abroad?

The new streamlined procedure is for U.S. citizens that are not currently living in the country. It was created as a way to help those citizens who are deemed to be at a low compliance risk avoid being hassled by the IRS (Internal Revenue Service) with penalties and follow-up actions. Those using the new streamlined … Continue reading Filing my U.S. income tax from abroad?

Pin It on Pinterest