Blog

Haven’t filed personal or small business (T1), corporate income tax (T2), or GST/HST returns in several years or more? Have you been contacted by or acted upon Canada Revenue Agency (CRA) including a Request to File or a Notional Assessment (of exaggerated estimated amounts owing just to get your attention)? Or do you want or need to become up to date with tax filings for various personal reasons? You may feel a sense of urgency or despair to catch up on unfiled previous years’ taxes. That’s ok, it taxes the mind too. You may be tempted or receive advice to
Business Tax, Late Tax Filing, Personal Income Tax, Tax Debt
, , , , , , , , , , ,
The proliferation of penalties that can and are now likely to be assessed by Canada Revenue Agency (CRA) without notice or discussion are severe and punishing. Below is just a small sample of common compliance issues and the resulting penalties as per the Canada Income Tax Act (ITA). 10 Common Reasons  & Likely Resulting Penalties Failure to provide information on a prescribed form, including SIN: $100 per failure Failure to file GST/HST return: Greater of $250 and 5% of the GST/HST outstanding Overstatement of non-refundable tax credits like the Child Tax Credit, Refundable Medical expenses and Investment Tax Credit: Liable
Business Tax, Late Tax Filing, Personal Income Tax, Tax Debt
, , , , ,
The exercise of claiming expenses is surprisingly subjective.  Here are some common occurrences that are frequently missed when claiming business expenses: Joint Ownership Joint ownership (project, real estate) and partnerships can change the % of allocation of losses/gains among co-owners for any period at any time.  So, if the partners agree (more common in close relationships) and the partnership agreement allows (change the agreement if it does not), split the net income/losses as would benefit each partners’ tax position in line with their contribution of money and effort to the business or property.  This also affects each partner’s entitlements to
Business Tax, Personal Income Tax
, , ,
A common concern we receive from individuals who are late filing personal income taxes is how to get lost or misplaced tax slips from previous years (for example T4s, T5s, T3s, etc.). It can seem overwhelming to try to look for all the tax slips however it is actually very simple to receive them. Every time your employer or payer issues you a tax slip, a copy is sent to Canada Revenue Agency (CRA) which means you can simply request copies for past years from CRA by using the online My Account for individuals service or speaking to a CRA agents
Late Tax Filing, Personal Income Tax
, , , , , ,
Eight Common Situations for Successful Allowable Business Investment Loss (ABIL) Claims: If you bought shares in or loaned money to a CCPC (Canadian Controlled Private Corporation) and the corporation became insolvent and did not pay you back or you sold the shares for less than you paid for them.   You invested directly in another person’s small business corporation (either as a shareholder, lender, partner, or joint venture participant) that failed outright or probably cannot repay the investment or loan in full when it becomes due.   You own or co-own a company (corporation) that is struggling financially or has
ABIL, Business Tax
, , , ,
If you lost money investing or loaning money to a Small Business Corporation (including your own business) you may be able to recover some of that loss as a tax refund. Canadian tax laws are purposefully designed to reduce the risk of loss of investments or loans to small business corporations. This type of loss is called an Allowable Business Investment Loss (ABIL) which is a special type of capital loss. It is important to note that ABILs are deductible against all other incomes in certain applicable tax years. Provided Canada Revenue Agency (CRA) has the proper proof and documentation
ABIL, Business Tax, Tax Debt
, , , ,