Ontario Budget 2019

Premier Doug Ford’s government released their first provincial budget today along with a new license plate and slogan for Ontario citing “A PLACE TO GROW”. The government has offered new tax credits, less regulations, cuts to government programs, and a new transit plan. Here’s some of the main points discussed in Ontario’s 2019 budget.

CARE Tax Credit

The Childcare Access and Relief from Expenses (CARE) tax credit will be introduced in Ontario to provide support for low income families in paying their childcare expenses. Families can receive up to $6000 per child under age 7, up to $3750 per child between the ages of 7 and 16, and up to $8250 for a child with a severe disability. Although the tax credit would primarily help low income households, the credit will also provide relief for households with income up to $150,000. The government is also allocating $1 billion over five years to increasing childcare spaces in Ontario.

Business Tax Credit

The government has offered a tax credit to businesses to allow them to write their capital expenses off immediately. The credit comes as an alternative to their plan to reduce the corporate tax rate. The purpose of this offering is to give companies an incentive to spend money as opposed to keeping profits.


$28.5 million will be allocated to a transit plan for the Greater Toronto Area which will include an increase in subway lines and regional rail transit. The plan includes the “Ontario Line”, which will be the new subway line connecting the Ontario Science Centre to Ontario Place.

Auto Insurance

The government is also proposing to reduce auto insurance rates by providing flexible options for providing insurance to drivers. The government is planning on implementing these changes over several years so that rates are more entwined with the driver’s history. They are also looking to allow electronic proof of insurance along with a new “Driver Care Card” for receiving benefits from claims. The province is also increasing the maximum benefit which can be claimed from $1 million to $2 million.

Dental Care for Seniors

$90 million will be allocated to assist low income seniors in getting dental care. Seniors with annual income below $19,300 or couples with combined income less than $32,300 will qualify for dental care this summer. This initiative will be implemented to give seniors greater access to dental care. According to the report, seniors were one of the most under represented groups to make regular dental check-ups.

Alcohol and Gambling

The government has also outlined it’s plans to decrease regulation in regards to gambling and alcohol sales. The government is proposing legislation to allow for drinking in parks, tailgating events, and to allow liquor sales in restaurants at 9am, 7 days a week. The government also is looking to allow private companies to participate in online casino style gambling.

The government is also planning on gradually decreasing the deficit and leading up to a surplus by 2024. The approach will involve reducing the amount of debt year by year and increasing the province’s debt to GDP ratio. The Finance Minister has stated that the approach is a “Goldilocks Approach” because the changes have to be just right in their implementation.

Overall, the changes introduced in the budget are of a large scope and are appealing to a large demographic. Seniors to millennials, low-income earners to high-income earners, and all people in between can expect one of these offerings to affect them in one way or another in the upcoming year.

Sound Too Good to Be True? It May Be a Tax Scheme

Did you know that between 2006 and 2017, 75 tax scheme promoters were convicted of crimes relating to tax schemes. The total of fines resulting from these prosecutions amounted to a total of 7.15 million and resulted in a total of 936 months of jail time for those convicted.
Tax schemes are promoted heavily during tax season and taxpayers need to have the facts regarding tax schemes in order to avoid them.

What is a Tax Scheme?

A tax scheme can be an individual or an organization that is deceiving a taxpayer into believing that they will be able to pay less taxes through unreasonably large deductions or that they will be able to receive an unusually large refund. Tax schemes often use illegal methods to get clients larger refunds and. When faced with a tax preparer who is promising an unusually large refund, be cautious.

What Should You Look Out For?

Beware of tax promoters that are promoting a return that is much higher than the initial investment towards it. Returns that are grossly disproportionate to the amount of money that is actually paid should be a red flag that there is something suspicious going on. You should also be cautious if the promoter is discouraging you from speaking to the CRA or getting a second opinion from another tax professional.

Common Schemes

A common scheme which resulted in billions of dollars in deductions being cancelled was the Charity Tax Shelter scheme which convinced Canadians that they could claim an amount equal to or greater than their charitable donation when filing their tax return. Donations paid to charities are only eligible to have a portion of the amount deducted. Charities must be registered with the CRA in order to issue official donation receipts and the CRA closely monitors charities and tax shelters to detect abuse of privileges. As a rule of thumb, donations for the purpose of only deducting taxable income are looked down upon by authorities and should be avoided.

Another common scheme involves promoters convincing unemployed individuals that they are eligible for the working income tax benefit(WITB) even if they have not worked during the year. The WITB is only available to low income individuals and families that have worked during the tax year. Schemes of these sorts take valuable tax dollars away from social programs and facilities for Canadians. The CRA takes participation in these schemes very seriously and invests large amounts of money towards preventing these schemes.

You Can Be Held Liable

Being a willing participant in a tax scheme can lead to serious consequences. If you knowingly participate in a tax scheme you can be prosecuted or penalized by the CRA to pay additional fees on top of the fees paid to a tax scheme.

Taxpayers that have knowingly participated in a tax scheme can visit the Voluntary Disclosures Program in order to disclose their information and fix their tax return. Disclosing involvement through the Voluntary Disclosures Program would allow for relief from prosecution in certain cases and limit the amount of penalties.

Be cautious of promoters that promise outrageous claims and practice due diligence in choosing a tax representative. Softron Tax has been a trusted tax preparation company for over 30 years. Visit one of our locations and have one of our friendly staff file your return for you today!

Federal Budget 2019

The 2019 federal budget has been released and the federal government is targeting investment in the middle class through many of the programs it is introducing. The expenditures in the budget aim to help young Canadians in gaining skills and purchasing homes. The total spending under the 2019 budget totals to $22.8 billion dollars. Here are some of the main areas the government will be targeting with the 2019 budget.

Skills Training

The government is introducing the Canada Training Benefit to help Canadians upgrade their skills in order to become more valuable to employers and competitive in today’s workforce. The Canada Training Benefit will allow for Canadians to receive a credit of $250 a year up to a lifetime maximum of $5000 which can be used against half the amount of training. The government is also dedicating a portion of the budget to helping young Canadians secure stable employment. The budget proposes to invest $49.5 million dollars over five years towards a modern Youth Employment Strategy. The government is also investing in the Canada Summer Jobs program as well as the Futurpreneur Canada program in order to assist future entrepreneurs and help students gain experience.

Affordable Housing

The First Time Home Buyers Incentive will allow eligible home buyers to finance a portion of their mortgage through the Canadian Mortgage Housing Corporation(CMHC) in order to reduce the amount of payments for their mortgage. The government is also increasing the Home Buyers’ Plan withdrawal limit from 25,000 to 35,000. The budget has also proposed to invest 300 million towards building new homes.

Pharmacare Initiatives

The budget is proposing to invest $35 million dollars over four years toward a “Canadian Drug Agency” in order to reduce spending on drugs. There will also be an investment of $1 billion over two years for increasing accessibility to high-cost drugs for rare diseases. These initiatives will assist in decreasing the burden Canadians face in paying for expensive drugs.

Seniors and Pension

The government is also introducing initiatives that will benefit seniors in retirement. The government plans to proactively enroll Canadians that are age 70 or over to receive benefits if they have not yet enrolled for benefits but are eligible to receive them. The budget will also enhance the Guaranteed Income Supplement(GIS) earnings exemptions to assist seniors with low income.

The Federal budget for 2019 promises to build a more secure future for young Canadians by targeting the areas which they are affected by significantly. Increased housing and initiatives to help home-buyers purchase their home and providing financing for greater employment will significantly help young Canadians. For more information on the 2019 budget, you can visit the government of Canada site.

RRSP : What You Need to Know

The deadline to contribute to your RRSP for the 2018 tax year is March 1, 2019, and with the deadline nearly here, we at Softron are sharing our expertise regarding what you need to know about RRSPs.

What is an RRSP?

RRSP stands for Registered Retirement Savings Plan. An RRSP can be a valuable vehicle to save one’s money for their golden years. The RRSP allows for individuals to contribute parts of their income into the plan tax-free. Contributors are allowed to deduct a portion of their contributions from their taxable income as well, resulting in less tax paid during the year.

Home Buyers’ Plan

Thinking of buying a home in the near future? You can withdraw up to $25,000 from your RRSP in order to purchase or build a home under the Home Buyers’ Plan. To qualify for this option you must be a first time home buyer and the funds must be repaid to the RRSP within 15 years.

Lifelong Learning Plan

Want to go back to school to pursue your dream job? The Lifelong Learning Plan allows you to withdraw from your RRSP in order to finance full-time education for you or your partner. The Lifelong Learning Plan cannot be used to finance your children’s education and you must repay one tenth of the amount that you withdrew every year until the amount is placed back into the RRSP.

Turning 71

The year you turn 71 is the last year in which you can contribute to your RRSP. During this year you must choose to either withdraw your funds, transfer them to an RRIF, or use them to purchase an annuity.

Contribute to your RRSP before March 1, 2019 in order to be eligible for the tax deduction for the 2018 tax year. Our tax experts at one of our locations are always happy to help with preparing your return or download our TaxTron software to file your return online!


Softron’s Tax Courses

Whether it is changes in the tax law or changes to how the tax filing industry will operate in the future, major changes are happening in the tax industry. While the changes are exciting, it is critically important to that professionals who are in the industry or planning to work in the tax industry are on top of all the new changes.

Softron tax courses are offered every year and updated with the latest tax changes that take place every year like the estate planning and trust course this year has been updated with the new laws that came into effect on January 1, 2016.
Industry experts at Softron tax have designed these tax courses with the following features:

• The course materials not only include the theory but real life case examples that give an idea to the students on how taxation works
• Animated explainer videos that make it easy for students to understand the concepts.
• All courses are available online but students also have the option of in-class instructor led courses to get the necessary guidance
• Instructors are industry experts and love to share their knowledge and experiences from the industry
It is a great opportunity for accounting firms across Canada to get their staff trained with the latest tax knowledge and be job-ready for the upcoming tax season.

Softron Tax Courses are a great opportunity for all those who are looking for a career opportunity or adding value to their skillset. You can enroll today by visiting www.softrontax.com/courses or calling 905-273-4444 or 1-877-SOFTRON

“ An investment in knowledge gives the best return”