Davidow & Nelson Blog

Personal and Corporate Incentives: ZERO-EMISSION VEHICLES

On April 17, 2019, Transport Canada released details on the purchase incentive of up to $5,000 for zero-emission vehicles as originally proposed in the 2019 Budget.The incentive will apply to new purchases or leases on or after May 1, 2019. To receive the incentive, the manufacturer’s suggested retail price must be less than $45,000 for… Read more »

Taxable: REIMBURSEMENT FOR WORK CLOTHING

In an April 17, 2019 Technical Interpretation, CRA was asked whether clothing reimbursements paid to maintenance employees were taxable benefits. Employees were not required to wear specific uniforms and were reimbursed based on receipts, to an annual maximum.CRA referred to Guide T4130 Taxable Benefits and Allowances, which states that clothing is generally a personal expense,… Read more »

Home Base Needed: SPECIAL WORK SITE ALLOWANCE

In a January 29, 2019 Technical Interpretation, CRA discussed the criteria for tax-exempt allowances for board and lodging received for periods an employee was working at a special work site.To be a special work site, the following criteria must be met: the work performed at the location must have been of a temporary nature; the… Read more »

TAX TICKLERS… some quick points to consider…

CRA’s limited review of corporate tax return projects have a reassessment rate of approximately 40%. In the past few years, these projects have focused on areas such as automobile expenses, professional fees, travel, and eligibility for the small business deduction. Many states in the U.S. have recently enacted laws requiring foreign sellers making sales to… Read more »

The “Equal or Near Equal” Issue: SHARED CUSTODY OF A CHILD

Certain tax benefits, such as the Canada child benefit, the GST/HST rebate, and the recently implemented federal carbon tax incentive (where applicable) are normally paid entirely to the parent with whom the child primarily resides. Where the child resides with the parents on an equal or near equal basis, each parent is entitled to half… Read more »

Meeting the Conditions: GST/HST NEW HOUSING REBATE

In a December 18, 2018 Tax Court of Canada case, the Court considered whether the new housing rebate was available where the taxpayer sold a newly developed property shortly after taking possession. The taxpayer entered into an agreement to purchase the land in 2012, took possession of it two years later when the building was… Read more »

Opting Out Retroactively: OLD AGE SECURITY (OAS) DEFERRAL

As of July 1, 2013, where receipt of OAS is delayed, the monthly pension is increased by a factor of 0.6% for each month deferred, to a maximum of 36% (60 months, commencing receipt at age 70). This option may be especially desirable for those whose OAS would be entirely clawed back due to high… Read more »

What Message Am I Leaving?: VIDEO LEGACY

When conducting our estate plans, we are often focused on the distribution of assets (such as homes, bank accounts, investments, and interest in private corporations), providing for dependents, and ensuring overall family harmony. However, softer issues may be overlooked. For example, some suggest that it may be useful to leave a video legacy for surviving… Read more »

Medical Expense Tax Credit: SAUNA AND HYDROTHERAPY POOL

In a December 4, 2018 Technical Interpretation, CRA was asked whether the costs of installing a steam shower (sauna) and hydrotherapy pool could be eligible for the medical expense tax credit (METC). The use of these devices was recommended as treatment to maintain strength and mobility.CRA noted that, for renovations to be eligible, they must:… Read more »

New Possibility: FIRST-TIME HOME BUYER INCENTIVE

Budget 2019 proposed the new Canada Mortgage and Housing Corporation (CMHC) first-time home buyer incentive, which is a shared equity mortgage that would give eligible first-time home buyers the ability to lower their borrowing costs by sharing the cost of buying a home with CMHC. Funding of 5% of the home purchase price would be… Read more »