Tag: Personal tax

Should I wait to pay my tax balances if I filed a taxpayer relief form?

Question: If I am late-filing a tax return due to an external factor and I did file a taxpayer relief form to explain the situation, should I pay my tax balances owing now or wait till the CRA to process my form? Answer:Well, you do have a choice to defer you payment. However, this will … Continue reading Should I wait to pay my tax balances if I filed a taxpayer relief form?

I have Stock options. What are the tax implications?

This topic can get complex. Therefore, it is highly advised to consult a tax professional. There are three possible scenarios with respect to stock options for tax purposes: On the grant date the exercise price is less than the market value of the shares (i.e. in the money). At exercise date, the difference between the … Continue reading I have Stock options. What are the tax implications?

Are all of my donations eligible for a tax credit (for individuals) or tax deduction (for corporations)?

No, only donations to registered charitable organizations (with the CRA) are eligible for a tax credit for individuals or for a tax deduction for corporations. Before you make a donation, ask the organization if they can provide you with an official donation slip for tax purposes.

What are some of the common mistakes investors make with TFSAs?

Mistake #1 You withdraw money from and make a contribution to your TFSA in the same year without regard to your TFSA Limit. For example, assume that you always contribute the maximum annual amount of $5,500 to your TFSA and you have no contribution room carried-forward from a previous year. If you contribute $5,500 to … Continue reading What are some of the common mistakes investors make with TFSAs?

Are my child/spousal support payments tax deductible?

Child support payments are NOT tax deductible in Canada. In contrast, spousal support payments are tax deductible as long as the taxpayer can provide proof of spousal support payments. The proof can be a separation and/or divorce agreement clearly stipulating the spousal support payment (i.e. if the taxpayer is providing both the child and spousal … Continue reading Are my child/spousal support payments tax deductible?

What’s the difference between a non-capital loss and net-capital loss?

Non-capital losses generally include losses from a business or employment. These losses can be applied to reduce all sources of income in the current tax year, the previous 3 years and the next 20 years. Net-Capital losses are losses incurred from the sale of capital property (e.g. shares, mutual funds, land, buildings, tangible assets). These … Continue reading What’s the difference between a non-capital loss and net-capital loss?

Can I get any tax relief for a bad loan that I made?

Question: I made a loan to a friend to help start up their business. However, his business was not successful and he will not be able to pay back the loan. Is there any tax relief for this bad debt? Answer:If the company the loan was provided to qualified as a Small Business Corporation, you … Continue reading Can I get any tax relief for a bad loan that I made?

Do university students have to file income tax return?

Absolutely. As a student, you must file a return if any of the following situation is applicable to you: you have to pay taxes for the year you have not repaid all amounts withdrawn from your RRSP under the Lifelong Learning Plan You have to contribute to the Canada Pension Plan (CPP) You received Working … Continue reading Do university students have to file income tax return?

Can I deduct massage expenses on my personal income tax return?

Question: My employer offers me employment benefits that covers $750 for massages. If I incurred extra, can I claim it as medical expense on my personal tax return? Answer: Generally speaking, the medical expense incurred by an individual from an authorized medical practitioner that is registered is eligible for claiming medical expenses for tax purposes. … Continue reading Can I deduct massage expenses on my personal income tax return?

How are capital gains determined?

My business has capital assets, including office furniture, equipment and vehicles. I sold these assets during the year and my accountant told me that I have a capital gain. What does this mean? Selling assets can trigger a capital gain or capital loss based on the selling prices minus the original cost. If the selling … Continue reading How are capital gains determined?

Are moving expenses a tax deduction, could you explain?

Moving expenses can be incurred by someone for relocation to commence business or employment in another part of Canada. This type of expense can be deduct to the extent of income earned in the new location – means the deduction is limited to the amount of employment income or business income earned at the new … Continue reading Are moving expenses a tax deduction, could you explain?

What does the CRA mean by other sources of income?

This is a catch-all category that captures taxable income which does not qualify as one of the primary sources. Major types of other income include: Benefits received from RRSP (including from a registered retirement income fund) Employer pension plan Old-age security from the government of Canada Benefits from employer’s deferred profit-sharing plan Canada, Quebec, or … Continue reading What does the CRA mean by other sources of income?

What are non-capital losses and do they expire?

The tax term for business losses is non-capital losses.  Non capital losses can be used to reduce taxable income from a prior year or a subsequent year.  If they are not used within a certain time period, then the non-capital losses expire.  The time period for utilizing non-capital losses depends on the taxation year in … Continue reading What are non-capital losses and do they expire?

I am not sure whether or not I have received all my government slips (eg. T4, T4A, T4RSP, etc). What can I do to ensure that I can get a hold of these?

You can simply call the CRA at 1-800-959-8281 and request for a copy. You can also authorize your accountant to request for a copy on your behalf.

Can I utilize my tuition credits on my personal tax returns when I start to work?

Yes, absolutely.   If you have previously filed tax returns during school years, CRA should have issued you the notice of assessment stating the unused federal and provincial tuition amounts that were to be carry forwarded. When you start to generate income, these tax credits will be applied – meaning they will help you to … Continue reading Can I utilize my tuition credits on my personal tax returns when I start to work?

Pin It on Pinterest