Bradley Jacoby Games Chartered Professional Accountants | Victoria, BC | 250-370-2191

Interest on Delinquent Accounts: Proper Disclosure on Legal Documents

In a November 10, 2017 Alberta Court of Queen’s Bench case, the amount of a creditor’s claim was challenged after an uncontested default judgment. The claim included interest calculated at 1% per month as stated in the contract. However, where a rate is not stated in per annum terms, the legal maximum is capped at 5% annually under the Canada Interest Act. Therefore, the interest payable was legally capped at 5% per year, rather than…

Continue Reading

Director’s Liability: Helping Out Family

Being a director of a corporation comes with many responsibilities. Failing to exercise due diligence in ensuring source deductions (such as EI, CPP, and income tax) are properly withheld from wages and remitted to CRA may result in a director’s personal liability for the corporation’s outstanding amount. A June 12, 2018 Tax Court of Canada case examined whether an individual who set up a corporation (along with a bank account) for his brother to operate…

Continue Reading
Retaining Employment Insurance Benefits: Starting Part-Time Work
Photo by Stefan Lorentz from Pexels

Retaining Employment Insurance Benefits: Starting Part-Time Work

As of August 12, 2018, the “Working While on Claim” program became a permanent part of the Employment Insurance (EI) system. Prior to the program, an individual could earn a very low weekly amount, after which the EI benefit would be eroded on a dollar for dollar basis of earnings. Under the new rules, a person who earns income while receiving EI benefits can keep $0.50 of their EI benefits for every dollar earned, up…

Continue Reading

CRA Tax Scams

There are several types of Canada Revenue Agency (CRA) scams going on right now. The image above is an example of what some people are receiving via email. The CRA will never send or request e-transfers of any kind. They will only send payments by direct deposit or cheque in the mail. If you receive an e-Transfer claiming to be from the CRA, it’s likely a scam! See more examples on the CRA website. The…

Continue Reading

Claiming Child, School, and Tutoring Costs

If you work or go to school and need childcare services you may be able to claim those expenses on your tax return. Some of the services are: caregivers providing child care services; day nursery schools and daycare centres; fees for child care services offered through educational institutions; day camps and day sports schools where the primary goal of the camp is to care for children (an institution offering a sports study program is not…

Continue Reading

Reporting a Foreign Property

The CRA has made changes to Form T1135 . It allows taxpayers who held foreign property with a total cost of less than $250,000, throughout the year, to report under a new simplified reporting method rather than providing the detail of each property. If the total foreign property is $250,000 or more, at any time during a year, the current detailed reporting method will continue to apply. For more information, click on: Reporting for the 2015…

Continue Reading

Directors: Can They Be Liable for Corporate Income Taxes?

A December 11, 2017 Tax Court of Canada case examined whether a taxpayer was liable for unpaid income taxes of the corporation of which he was a director. CRA’s assessment was based on the assertion that the taxpayer was a legal representative of the corporation and had distributed assets of the corporation without having first obtained a clearance certificate from CRA. A clearance certificate essentially confirms that the corporation has paid all amounts of tax,…

Continue Reading

Donation Receipts: How Complete is Complete?

Charities should ensure that any donation receipts issued are fully compliant with the tax rules. Failure to do so may result in the donor being denied a charitable donation if reviewed by CRA. This could cause operational and goodwill problems for the charity. Receipts for cash gifts must have the following: a statement that it is an official receipt for income tax purposes; the name and address of the charity as on file with CRA;…

Continue Reading

Home Buyers Need to Check Residency of Home Sellers If They Suspect the Seller Is Not Canadian

When Canadians purchase a home, they are required to withhold part of the purchase price should the seller be a non-resident of Canada. A recent Tax Court of Canada decision (Kau v. the Queen [2018 TCC 156]) should serve as a warning to clients and professionals alike, to watch for any red flags that might suggest the seller is not a resident of Canada. As a result of this recent court decision, the home buyer…

Continue Reading

Reasonable Vehicle Allowances: GST/HST Claim

A travel allowance paid to an employee for the use of their personal vehicle for business purposes will be non-taxable if it is reasonable. Where such reasonable allowances are paid, an input tax credit (ITC) may be claimed by the employer. The ITC is computed as the imputed GST/HST in the allowance, without adjustment for the fact that some costs likely did not attract GST/HST. In non-harmonized provinces/territories (such as Alberta and BC), the ITC would be 5/105 of the allowance. The ITC in a harmonized province is different.…

Continue Reading
  • 1
  • 2