Davidow & Nelson Blog

Increased Disclosures and Taxes: Underused Housing Tax (UHT)

UHT is a 1% federal tax intended to apply to the value of vacant or underused residential real property owned by non-resident non-Canadians. However, many Canadian individuals and other entities are also required to file UHT returns and may even be liable for the tax. Numerous exemptions from the tax itself exist, but significant penalties can apply where the required… Read more »

Top Five Items for Owner-Managers: Budget 2023

Budget 2023 (A Made-in-Canada Plan: Strong Middle Class, Affordable Economy, Healthy Future) was introduced in the House of Commons on March 28, 2023. The top five changes that may impact individuals and owner-managed businesses are as follows: – Dental plan – The Canadian Dental Care Plan would be introduced to provide coverage for all uninsured Canadians with an annual family income of less… Read more »

Tax Tidbits

Some quick points to consider… – New federal rules have been proposed that would prohibit arrangements designed to restrict competition in the labour markets. These include, for example, wage-fixing arrangements intended to fix, maintain, decrease or control salaries, wages or terms and conditions of employment. – Financial institutions began offering tax-free first home savings accounts in April. The plans… Read more »

Taxable or Not?: Poker Winnings

A November 25, 2022 French Tax Court of Canada case considered whether a taxpayer’s poker activity constituted a source of business income and therefore the winnings were taxable, as argued by CRA. The taxpayer argued that his winnings were non-taxable as they were derived from his hobby rather than a business. The taxpayer generated poker… Read more »

Additional Support: One-Time Top-Up to The Canada Housing Benefit

A one-time tax-free payment of $500, announced in September 2022, is now available to low-income renters. The payment does not reduce other federal income-tested benefits. Eligible individuals must: – be 15 years of age or older on December 1, 2022; – be resident in Canada for tax purposes in 2022; – have filed their 2021… Read more »

Support for those with Young Children: Canada Dental Benefit

The Canada dental benefit, announced in September 2022, provides up-front tax-free payments to cover dental expenses for children under age 12 without dental coverage. The program began December 1, 2022, with expenses retroactive to October 1, 2022 being covered. The program is available for two periods: December 1, 2022 to June 30, 2023, and July… Read more »

Choose them Wisely: Witnesses For Legal Documents

A June 17, 2022 Ontario Superior Court of Justice case considered whether a will had been appropriately witnessed. In 2020, the owner of an insurance agency was diagnosed with terminal cancer and drafted a final will and testament. As it was the height of the COVID-19 pandemic, she chose two of her employees to meet… Read more »

Updated CRA Policies: Employee Gifts and Parking

CRA updated several administrative policies in respect of employment benefits, effective January 1, 2022. Two of the key changes relate to employee gifts and parking. These updates were released in late 2022. Gifts, awards and long-service awards Under CRA’s existing gifts and awards administrative policy, the first $500 of annual gifts and awards provided to… Read more »

Multiple Issues: Unreported Real Estate Dispositions

A September 12, 2022 Tax Court of Canada case reviewed the gain on a residential property purchased in 2007 and disposed of in 2011. The property was substantially rebuilt during the ownership period. The proceeds, cost and gain were all determined by CRA as the sale was unreported. These amounts were largely unchallenged by the… Read more »

Review/Audit Activity: Covid Benefits

On December 6, 2022, the Auditor General of Canada released its report on COVID benefit compliance enforcement. The report reviewed a total of $210.7 billion in payments with the following breakdown among programs. – Canada Worker Lockdown Benefit (CWLB) – $0.9 billion – Canada Emergency Wage Subsidy (CEWS) – $100.7 billion – Canada Recovery Sickness… Read more »