December 31, 2020 is fast approaching… see below for a list of tax planning
considerations. Please contact us for further details or to discuss whether these
may apply to your tax situation.
SOME 2020 YEAR-END TAX PLANNING TIPS INCLUDE:
1) Certain expenditures made by individuals by December 31, 2020 will be
eligible for 2020 tax deductions or credits including:
digital news subscriptions, registered journalism
organization contributions, moving expenses, child care
expenses, charitable donations, political contributions,
medical expenses, alimony, eligible employment
expenses, union, professional or like dues, carrying
charges and interest expense. Ensure you keep all
receipts that may relate to these expenses.
2) No tax was withheld on Canada Emergency Response Benefit (CERB)
payouts. Since these payments are taxable, taxes may be payable upon filing.
If you received a retroactive payment from your employer in respect of a
period for which you have received CERB, you may be required to pay the
3) There are benefit clawbacks (required repayments) associated with certain
COVID-19 related employment insurance-like payments, depending on annual
earnings. The amounts for 2020 are:
– Canada Recovery Benefit – $0.50 of every dollar earned in excess of
– Employment Insurance – $0.30 of every dollar earned in excess of
– Canada Emergency Response Benefit – No clawback due to annual
earnings is applicable
4) A senior whose 2020 net income exceeds $79,054 will lose all, or part, of their
Old Age Security pension. Senior citizens will also begin to lose their age
credit if their net income exceeds $38,508. Consider limiting income in excess of these amounts if possible.
Another option would be to defer
receiving Old Age Security
receipts (for up to 60 months) if it
would otherwise be eroded due
to high income levels.
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