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Personal Tax

Hi David, Yes, you must pay HST on the sale price of short-term rental properties. A property is considered a short-term rental if the owner uses it for personal use less than 50% of the time during the rental season, and more than 90% of the bookings are for 60 days or less. This represents … Continue reading Personal Tax

Clarification on Tax Treatment of US LLC as General Partner in Limited Partnership for Canadians

Hi John, The LLC should be owned by a single member and therefore it will be classified as a disregarded entity. A disregarded entity does not have to file a separate US tax return which will simplify and reduce your compliance costs.

Capital Gains Tax on Real Estate Sales in Canada

Hi Chris, The Government of Canada increased the capital gains inclusion rate from 50% to 67% for property sales made after June 24, 2024. You will owe $189,917 of capital gains tax based on the new rules, which is calculated as follows: 1) $250,000 x 50% inclusion rate x 53% marginal tax rate = $66,250 … Continue reading Capital Gains Tax on Real Estate Sales in Canada

Forming a US LLC for Construction Expansion

Hi Ben, You can form a US LLC, but make sure that you elect that it be taxed as a C-corporation. Otherwise, you will be double taxed. This is because, without the election, the IRS will treat the LLC as a pass-through entity. However, the CRA always treats US LLCs as foreign corporations. This creates … Continue reading Forming a US LLC for Construction Expansion

Inquiry About Tax Withholding Change

Please complete form NR301 (available from the CRA’s website) and send it to InvestorLine.

Transfer property from my corporation to myself

Hi Hannah, You have to sell the property from the corporation to yourself for fair market value. If the property has increased in value, there will be a capital gain.

Filing tax- working in the US under tn , spouse and kids in Canada

Hi Kenny, You are likely a tax resident of Canada under the Canada-US tax treaty because your home, spouse, and child are in Canada. Therefore, you are liable for Canadian income tax on your global income. You must claim a foreign tax credit to avoid double taxation. My services & estimated fees are as follows: … Continue reading Filing tax- working in the US under tn , spouse and kids in Canada

tax filing for Canadian resident with US based company

Thank you for your question. I do work with non-Canadians living in Canada and doing business in the US. I must first determine whether you are a resident of Canada or non-resident of Canada for Canadian tax purposes. To make this determination, I will refer to the tie-breaker rules contained in the UK-Canada tax treaty … Continue reading tax filing for Canadian resident with US based company

Penalty on late filing of t2

Hi Sam, The corporate tax return filing due date is 6 months after the company’s year-end. For example, if a company has a year ending on March 31, 2024, the corporate tax return must be filed by September 30, 2024. If you pay the corporate tax balance due within 3 months of the company’s year-end … Continue reading Penalty on late filing of t2

Taxation for other private corporation and non resident dividends

Hi Sam, The corporate tax rate for a non-CCPC is 27% on average (varies by province). Assuming a non-CCPC made a profit of $100,000, a corporate tax is payable for $27,000. In addition to this, a non-resident withholding tax of 25% is deducted from dividends paid to non-resident shareholders. Assuming a dividend payment of $73,000, … Continue reading Taxation for other private corporation and non resident dividends

how do i enter tax paid for last year in T2

The best practice is to amend the previous year’s corporate tax return to correct the error. It should not trigger an audit since there will not be any change to the taxable income. If you are uncomfortable doing this, then record the amount in this year’s “Current Income Tax Expense.” The current income tax expense … Continue reading how do i enter tax paid for last year in T2

Tax residency

You cannot be a tax resident of Canada and Portugal at the same time according to the double taxation treaty between the 2 countries. You are deemed to be a resident of the country where your permanent home is located. If you have a permanent home in both Portugal and Canada, you are a resident … Continue reading Tax residency

Emigration ccpc year end

Hi Sam, The CRA should have reflected the updated year-end if you specified the deemed year-end on Box 61, checked “Yes” to Box 66 and selected “Other Private Corporation” in box 40 on the amended T2 return. If you did all of the above and the CRA has not updated the year-end, then contact the … Continue reading Emigration ccpc year end

Dissolving provincial corporation

Hi Sam, If the computer has limited to no value, claim a depreciation expense for the remaining cost on the balance sheet. Otherwise, record $3,000 to dividends, as you received a company asset for your personal benefit. Do not adjust the share capital, common shares.

Tax Residency In Australia VS. Canada (online small business)

Hi Stephanie, The corporate tax rate for Australian small businesses is 25%. A small business is a business with annual sales of less than $50 million AUD. The corporate tax rate for Canadian small businesses is 12%. A small business is a business controlled by Canadian residents with active net income of less than $500,000 … Continue reading Tax Residency In Australia VS. Canada (online small business)

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