Benefits Paid to Shareholder Employees: Are They Taxable?

The CRA is aware that owner-managers have an incentive to receive benefits deductible by their corporation which are non-taxable to the owner. In essence, this can be perceived as a method to extract profits out of a corporation without paying tax on it. As such, CRA is particularly vigilant to ensure that these benefits comply with the Income Tax Act and do not confer unfair advantages on owners. To start off, it must be established…

Continue Reading

Taxpayer Relief: Financial Hardship

CRA may grant relief from penalties and interest in cases where the timely satisfaction of a tax obligation was not completed due to: extraordinary circumstances;actions of the CRA; orinability to pay or financial hardship. In a March 31, 2016 Federal Court Judicial Review, the taxpayer appealed a decision by CRA to refuse relief on penalties and interest. In this case, the taxpayer argued that the CRA agent did not reasonably appreciate the taxpayer's financial difficulties.…

Continue Reading

2018 Tax Planning: Renumeration

Higher levels of personal income are taxed at higher personal rates, while lower levels are taxed at lower rates. Therefore, individuals may want to, where possible, adjust income out of high income years and into low income years. This is particularly useful if the taxpayer is expecting a large fluctuation in income, due to, for example, an impending maternity/paternity leave; large bonus/dividend; or sale of a company or investment assets. In addition to increases in…

Continue Reading
Close Menu