Form T1135, known as the Foreign Income Verification Statement, must be completed during tax season if you own foreign assets with a total cost exceeding $100,000. Whether it's a UK bank account, an investment property in France, or shares in an American tech company, you are required to use Form T1135 to report these assets to the CRA.
No, it is based on the original purchase cost. This cost is usually the adjusted cost base of the asset, not its current market value, and is reported in Canadian dollars.
"SFP" stands for "Specified Foreign Property." When completing Form T1135, you need to report the following types of Specified Foreign Property:
All specified foreign property must be reported if the total cost amount of all such property exceeds $100,000 (Canadian) at any time during the year.
The following are not considered SFP:
If the total cost of your specified foreign property exceeded $100,000 at any point during the year, you must report all such property held during the year on Form T1135, even if you sold some or all of it before year-end.
Canadian residents must report all income earned from foreign property, regardless of the property's cost amount. While the $100,000 threshold means many Canadians don't need to meet the additional reporting requirements of Form T1135, it does not exempt them from paying taxes on income earned from that property.
You must report the gross income from the specified foreign property on Form T1135.
No. You are required to separately report the income (or loss) and the gain (or loss) from the sale of each specific specified foreign property on Form T1135. Canadian capital losses cannot be used to offset foreign capital gains on this form. Form T1135 is intended to identify foreign property, not to calculate taxable income.
Specified foreign property does not include personal-use property. Personal-use property is generally defined as property owned by the taxpayer that is primarily used for personal enjoyment by the taxpayer or a related party, with "primarily" meaning more than 50%. Whether a property is considered primarily for personal use is assessed on a case-by-case basis.
In situation 1, since the property is not used mainly for personal enjoyment, it qualifies as specified foreign property and must be reported on Form T1135.
In situation 2, if there is no reasonable expectation of profit and the individual is only covering some of the condo's expenses, the CRA will view it as personal-use property. Therefore, it does not qualify as specified foreign property and is not subject to Form T1135 reporting requirements.
Yes, the taxpayer must still file Form T1135. Even though the down payment is $70,000, the total cost of the property is $700,000, which exceeds the $100,000 reporting threshold.
Individuals can file Form T1135 electronically (EFILE or NETFILE) for the 2017 tax year and onwards. Corporations can EFILE Form T1135 electronically starting from the 2014 tax year. Partnerships can also file Form T1135 electronically (EFILE or NETFILE) from the 2017 tax year onward.
Filing electronically provides an immediate confirmation number, indicating that the Canada Revenue Agency (CRA) has received your form.
No. You must use the version of Form T1135 that was in effect for the specific tax year you are filing. The version of the form used should correspond to the tax year for which you are reporting the foreign income.
No. This reminder is automatically included on a notice of assessment whenever a taxpayer indicates on their tax return that they have specified foreign property with a total cost exceeding $100,000.
The CRA encourages taxpayers to use the latest version of Form T1135 for all tax years. However, they will accept amended forms submitted on the same version as originally filed. Ensure that the amended return box is checked and that all required information, not just the changes, is provided.
The two methods for reporting foreign property on Form T1135 are:
Yes, as long as you meet the reporting requirements for Part A. This means the total cost of all specified foreign property was more than $100,000 but less than $250,000 throughout the year. However, if at any point during that period you held specified foreign property with a total cost of $250,000 or more, you must complete Part B—the detailed reporting method.
Yes, a life insurance policy issued by a foreign issuer meets the definition of specified foreign property.
Only taxpayers who are residents of Canada are required to file Form T1135. However, non-residents may still be taxed on employment income earned in Canada.
A partnership must file Form T1135 if it is a specified Canadian entity and held specified foreign property with a total cost of more than $100,000 at any time during the reporting period. A partnership is considered a specified Canadian entity if less than 90% of its total income (or loss) comes from non-resident partners.
If a Canadian resident taxpayer has an interest in a partnership that is a specified Canadian entity, they do not need to report this interest on Form T1135.
However, if a Canadian resident taxpayer has an interest in a partnership that is not a specified Canadian entity, they must report their interest on Form T1135 if the partnership holds specified foreign property. The taxpayer should provide details of their partnership interest in category 6, "Other property outside Canada."
If a partnership required to file Form T1135 fails to do so on time or accurately, and a partner does not report income from specified foreign property on their tax return, the normal reassessment period for that Canadian resident partner will be extended by three years.
Specified foreign property held in an RRSP or TFSA is exempt from Form T1135 reporting requirements.
Yes, the Voluntary Disclosures Program might be available if certain conditions are met. Taxpayers who have provided incomplete information, omitted details, or failed to file Form T1135 are encouraged to come forward and correct their tax matters through this program. To qualify, a taxpayer must submit a valid disclosure.
Don’t let the deadline for filing Form T1135 catch you off guard: Ensure you file the form by the same date as your income tax return. For most people, this deadline is April 30 of the year after the tax year in question.
You must file Form T1135 for a given tax year if the total cost of your foreign assets exceeds $100,000 at any point during that year. If you surpass this $100,000 threshold each year, you will need to file Form T1135 every year.
If you are self-employed or if your employer requires you to use your own car for work purposes, you can claim certain auto expenses related to your EV, such as interest or lease payments, depreciation, hydro costs directly related to charging your car, repair and maintenance, and insurance. However, you cannot claim it on your personal tax return if it is not used for business purposes.
You can claim meal expenses as an Uber driver if you are traveling long distances and are away from home. Make sure to keep a record of all your receipts.
If you are a first-time home buyer, you can claim up to $10,000 worth of non-refundable tax credits.
I have dual citizenship from USA and Canada, I am traveling to USA to vote. Can I get tax deduction?
No. Traveling for the purposes of voting is considered a personal expense and is not tax deductible in Canada or the United States.
No, over-the-counter medicines are not an eligible medical expense.
No, breast enhancement surgery is a cosmetic surgery and cannot be deducted in your personal tax return as a medical expense.
Cosmetic surgery only for cosmetic procedures such as liposuction are not tax deductible. However, if this surgery was prescribed by a doctor for some severe health condition, then it can be deducted.
Personal travel such as traveling for vacation is not tax deductible.
In Canada, summer camp expenses can be claimed as a child care expense deduction on your personal income tax return. If the primary purpose of the camp is to provide child care, such as day camps, these expenses are usually deductible.
Ontario park membership is not tax deductible because it is considered a personal expense.
CNE tickets are a personal expense and cannot be claimed under your personal tax return.
You can claim TTC and Go transit expenses in two cases. Firstly, if you have a business and your business requires you to travel for example to meet your clients. Secondly, if you are over 65 years of age and use TTC and Go transit for traveling, you can claim a refundable tax credit in Ontario (Ontario Seniors’ Public Transit Tax Credit).
No. Wonderland passes for your kids are a personal expense and are not deductible on your personal tax return as childcare expense.
Personal expenses such as costumes for a festival are not deductible on a personal tax return. But if you were performing in the festival and you bought these costumes to earn income then you can claim it under your business (self-employed) as a business expense.
Supporting documentation is required to verify the legitimacy of the claimed expenses, ensuring that they meet the eligibility criteria set by the CRA.
Cosmetic procedures are typically not considered essential medical treatments and are often viewed as elective, non-medical expenses, which is why they are generally not eligible for the METC.
The purpose of the METC is to provide financial relief to individuals and families who incur significant medical expenses, helping to offset the cost of necessary medical care and treatments.
Yes, the cost of installing a stair lift or elevator to accommodate a disability is eligible.
Yes, expenses for special education and tutoring services for individuals with disabilities are eligible if provided by a licensed practitioner.
Yes, expenses for mobility aids like wheelchairs, walkers, and scooters are eligible.
Yes, expenses for home modifications to accommodate a disability, such as installing ramps, widening doorways, or modifying bathrooms, are eligible.
You can claim expenses for home modifications, mobility aids, assistive devices, medical treatments, therapy, and personal care services.
Yes, you can claim the DTC and also claim eligible medical expenses. The DTC helps to reduce the amount of income tax you may have to pay.
Yes, dental implants are eligible if provided by a licensed dental practitioner.
Yes, laboratory tests and diagnostic procedures prescribed by a medical practitioner are eligible.
Yes, the cost of a medical alert system can be an eligible medical expense.
Yes, self-employed individuals can claim eligible medical expenses as deductions on their tax returns.
You can claim medical expenses on line 33099 or 33199 of your tax return, depending on who the expenses were for. Keep receipts and supporting documents for verification.
The METC is available to taxpayers who have eligible medical expenses that exceed a certain percentage of their net income. The expenses must be for the taxpayer, their spouse or common-law partner, or their dependents.
Plastic surgery expenses can be eligible for the medical expenses tax credit if the surgery is necessary for medical or reconstructive purposes due to an illness, injury, or congenital abnormality. Cosmetic procedures performed solely for aesthetic purposes are generally not eligible. To claim these expenses, you may need documentation from a medical practitioner stating the reasons for the procedure.
Yes, prescription eyeglasses and contact lenses are considered eligible medical expenses, provided they are prescribed by a licensed medical practitioner.
Yes, you can claim eligible medical expenses for your spouse or common-law partner, as long as the expenses meet the CRA's criteria and were not claimed by your spouse, or reimbursed.
Do not send any documents with your tax return. In Canada, you should keep your medical receipts for at least six years from the end of the tax year to which they relate.
If your dependent did not reside with you, they must have been a resident of Canada at some point during the year. However, this residency requirement does not apply to your child or grandchild, or those of your spouse.
The medical expenses tax credit is a non-refundable tax credit that helps Canadians reduce the amount of tax they owe by claiming eligible medical expenses.
Any Canadian taxpayer who has incurred eligible medical expenses for themselves, their spouse or common-law partner, or their dependent children under 18 years of age.
Eligible expenses include, but are not limited to, prescription medications, dental services, certain medical devices, and travel expenses for medical treatment not available locally.
Check for more information here at the CRA website : Lines 33099 and 33199 – Eligible medical expenses you can claim on your tax return - Canada.ca
Yes, the medical practitioner must be a qualified medical professional as recognized by the jurisdiction in which they practice, such as a doctor, dentist, or physiotherapist.
Yes, if you have unclaimed medical expenses that you could not use in the current year, you may be able to carry them forward and claim them in a future year, within a 12-month period ending in the current tax year.
Yes, if you have unclaimed medical expenses that you could not use in the current year, you may be able to carry them forward and claim them in a future year, within a 12-month period ending in the current tax year.
Yes, fees paid for physiotherapy and occupational therapy are eligible if provided by a licensed practitioner.
Yes, prescription eyeglasses and contact lenses are eligible medical expenses if prescribed by an optometrist or ophthalmologist.
Yes, costs for immunizations and vaccines are eligible medical expenses.
Yes, expenses for addiction treatment programs and services are eligible if provided by a recognized medical institution or professional.
Yes, the cost of a medical alert system can be claimed if it is prescribed by a medical practitioner.
Yes, reasonable transportation costs for medical appointments are claimable, especially if the distance traveled is significant and the service is not available locally.
Alternative treatments such as acupuncture and chiropractic services are claimable if performed by a licensed practitioner.
Yes, nursing home expenses, including care and accommodation, are claimable if the care is required due to a severe and prolonged impairment.
Yes, weight-loss surgeries, such as bariatric surgery, are eligible if performed by a qualified medical practitioner. The CRA may request documentation detailing the reasons for the surgery and the factors considered by the medical practitioner in recommending the procedure such as Body Mass Index (BMI) and/or other underlying conditions.
Generally, cosmetic procedures are not claimable unless they are necessary for medical or reconstructive purposes due to an accident or illness.
Yes, medical cannabis is an eligible expense if purchased from a licensed producer and used for medical purposes as prescribed by a healthcare practitioner.
Yes, you can claim the cost difference between a private hospital room and a semi-private room as an eligible medical expense if it is required for medical reasons.
Yes, the incremental cost of gluten-free products for individuals with celiac disease can be claimed, provided there is a medical diagnosis. The incremental price of gluten-free foods that can be claimed as a medical expense is defined as the difference in cost between gluten-free products and their gluten-containing counterparts.
Yes, home care services provided by a nurse or other healthcare professional can be claimed, as long as they are necessary due to a medical condition.
Weight-loss programs and medications such as Ozempic, Mounjaro, or Wegovy can be claimed if they are prescribed by a medical practitioner as part of a treatment for a specific medical condition.
Yes, you can claim medical expenses paid within any 24-month period that includes the date of death. The claim must be made in the deceased person's final tax return.
Yes, costs related to acquiring, training, and maintaining a service animal are eligible if the animal is trained to assist a person with a severe disability.
Yes, fertility treatments, including in-vitro fertilization (IVF), are eligible medical expenses if they are performed by a qualified medical practitioner or a licensed fertility clinic.
Yes, dental expenses, including cleanings, fillings, extractions, and dentures, are eligible if performed by a licensed dental professional.
Yes. You can claim the expense. You can claim the lesser of $1,000 or 50% of the air conditioner cost for an individual with a severe chronic ailment.
Yes, the cost of certain assistive devices can be claimed as eligible medical expenses. This includes items like wheelchairs, hearing aids, crutches, and other devices prescribed by a medical practitioner. The device must be necessary to assist with a disability or medical condition and meet the CRA's eligibility criteria.
Check for more information here at the CRA website : Lines 33099 and 33199 – Eligible medical expenses you can claim on your tax return - Canada.ca
There is no age limit; you can claim medical expenses for yourself, your spouse or common-law partner, and your dependants, regardless of their age.
Yes, fees paid to licensed psychologists, therapists, and other mental health professionals are eligible if they meet CRA requirements.
If your medical expenses were reimbursed, you can only claim the portion of the expenses that were not covered by insurance or other sources such as your employer.
An individual can claim any eligible medical expenses incurred in a 12-month period that ends in the current location year.
Unfortunately, taxpayers can no longer claim hair transplant costs as eligible medical expenses, regardless of whether the procedure was completed by a medical practitioner, after March 4, 2010. However, other medical expenses may still be deductible. For instance, the costs for wigs prescribed by medical doctors for individuals who have suffered abnormal hair loss due to disease or an accident are considered as eligible medical expenses.
Unfortunately, taxpayers can no longer claim hair transplant costs as eligible medical expenses, regardless of whether the procedure was completed by a medical practitioner, after March 4, 2010. However, other medical expenses may still be deductible. For instance, the costs for wigs prescribed by medical doctors for individuals who have suffered abnormal hair loss due to disease or an accident are considered as eligible medical expenses.
Yes, medical expenses incurred outside of Canada are eligible as long as they meet the CRA’s eligibility criteria and are similar to expenses that would be allowed within Canada.
Yes, you can claim expenses for renovations or alterations to your home to accommodate medical accessibility needs, such as installing ramps or modifying bathrooms, if prescribed by a medical practitioner.
You can claim medical expenses for any 12-month period ending in the tax year. Ensure you have not previously claimed these expenses in another tax year.
In order to calculate your total claim, use the total amount of your CRA allowable medical expenses for that year, minus 3% of your net income, the maximum dollar amount set by the CRA, which is updated annually – whichever is the lesser of the two amounts.
You cannot claim over-the-counter medications, vitamins, or supplements, even if prescribed by a medical practitioner (except vitamin B12).
Yes, travel expenses can be claimed if you had to travel at least 40 kilometers (one way) to get medical services not available near your home. You can claim public transportation costs or vehicle expenses if you traveled by vehicle.
Keep all receipts, prescriptions, and any other documentation that supports your claims. In Canada, you have to keep your medical receipts for at least six years from the end of the tax year to which they apply. The CRA may request these documents if they review your tax return.
Yes, you can claim medical expenses for yourself, your spouse or common-law partner, and your dependents.
The minimum amount is the lesser of 3% of your net income up to a maximum dollar amount set by the CRA, which is updated annually.
Medical expenses that qualify include payments made to medical practitioners, hospital services, prescription drugs, medical devices, dental services, and many others as listed by the Canada Revenue Agency (CRA).
It is best to book an appointment in advance to ensure you get the service you need without a long wait. However, some locations may accept walk-ins depending on their schedule and capacity. It's a good idea to call the specific Softron location ahead of your visit.
You can locate the nearest Softron Tax office by visiting our website at Softrontax Locations
Yes, you can file taxes from anywhere using Softron Tax. We offer online services that allow you to submit your tax information remotely, so you can complete your tax return without needing to visit a physical office. This flexibility makes it convenient to file your taxes from the comfort of your home or any location with internet access.
When filing taxes in Canada, you'll need various slips based on your income and deductions. Common slips include:
The Guaranteed Income Supplement (GIS) is a monthly payment available to individuals aged 65 and older. This supplement is income-based and supports Old Age Security pensioners with low income. The payments are non-taxable.
Through your Canadian financial institution, Canada Revenue Agency’s My Account, My Canada Revenue Agency on mobile, or by calling 1-800-959-8281.
You must make tax instalments for similar reasons that most people have tax deducted from their income throughout the year. If you earn income without tax withheld or insufficiently withheld over multiple years, you may need to pay taxes in instalments.
This situation can arise from:
You can request most remittance vouchers or payment forms via:
To ensure your payment is correctly applied to your Canada Revenue Agency account, bring an original remittance voucher. Banks and credit unions do not accept photocopies or other types of payment forms. If you don't have a remittance voucher, you can order or print one from the Canada Revenue Agency 's website.
If you receive a call about a balance owing or debt collection that isn't listed on official Canada Revenue Agency notices such as a Notice of Assessment, Notice of Reassessment, Notice of Determination, or Notice of Debt, it's crucial to:
If you fail to pay an amount owed on time, the Canada Revenue Agency may impose interest on the outstanding balance. Interest applies to most late payments of personal and business taxes, including required instalments.
You can arrange future payments directly from your chequing account using the Canada Revenue Agency's secure online services by setting up pre-authorized debits (PAD). Several banks or credit unions also offer options for scheduling future payments.
Yes, you can amend your tax return after filing if you realize there are errors or if you need to make changes to the information you initially reported. This is done by submitting a T1 Adjustment Request form to the Canada Revenue Agency, depending on the nature of the changes needed. It's important to ensure accuracy and completeness when amending your tax return to avoid potential issues or delays in processing.
In certain situations, the Canada Revenue Agency may consider providing relief. It's important to promptly address late or incorrect tax filings or delayed payments with the Canada Revenue Agency to explore potential options for easing your financial obligations.
You can explore the following options:
Eligible lodging expenses for long-haul truck drivers generally include :
For most work-related travel, individuals typically can claim only 50% of their meals and beverage expenses. However, long-haul truck drivers are eligible to deduct 80% of these expenses. When claiming meal expenses incurred in the United States, you are entitled to deduct 50% of the costs. You can calculate meal expenses using either the simplified or detailed method.
As a long-haul truck driver, you can claim a portion of your meal and accommodation expenses as deductions on your income tax return.
To calculate your benefits, you can use the Canada Revenue Agency benefits calculator to determine the child and family benefits you may be eligible for.
Canada offers several benefits for low-income individuals and families that include:
The time it takes to receive your tax refund can vary. Generally, if you filed your taxes electronically and opted for direct deposit, you can expect to receive your refund within about 2 weeks. If you filed a paper return it may take about 8 weeks and if you file as a non resident it may take about 16 weeks.
The T1 General Tax Form serves as the main document for filing personal income tax returns in Canada and assessing your tax obligations. It consolidates all your income and taxes deducted during the tax year into a comprehensive summary.
The Guaranteed Income Supplement (GIS) is determined by your household's taxable income from the previous year. Not all sources of income are included in this calculation; most inheritances, lottery winnings, TFSA withdrawals, your OAS, and the GIS itself are excluded.
The Canada Revenue Agency aims to issue your notice of assessment and any refunds within these timelines:
You can receive your Notice of Assessment in two ways :
Your Notice of Assessment (NOA) is an evaluation of your tax return sent by the Canada revenue agency each year after you file you Tax. It includes the date your tax return was processed and details about any amount you may owe, as well as any refund or credit you may receive.
In Canada, the start of your benefits depends on the specific benefit program:
Direct deposit is the quickest way to receive your refund and other payments from the Canada revenue agency. They will securely deposit funds into your Canadian bank account. If you are not enrolled in direct deposit, your only other option for Canada Revenue Agency payments is by cheque.
To pay your balance owing to the Canada Revenue Agency, you have several options to choose from :
In Canada, there's no specific age for filing taxes. You should file a return if you have income or want to claim credits and benefits. Even if under 18, you may need to file if you:
There are situations where you may not be eligible for benefits. If you're not eligible, Service Canada will notify through My Service Canada Account of the decision made about your application. You will be able to review information as to why you are not currently eligible for benefits.
Based on the unemployment rate in your area, you will need between 420 and 700 hours of insurable employment during the qualifying period to qualify for regular benefits. As these amounts and thresholds vary from year to year, you are advised to visit the Canada Revenue Agency (CRA) website for the most up-to-date information.
You cannot get money from both sources for the same time you are off work. This means that once you get your workers' compensation benefits, you will have to pay back the money you got from EI for the same time period.
You'll be responsible for paying Employment Insurance when you file your income tax return each year. You'll pay Employment Insurance based on your self-employed income for the entire calendar year. The EI premiums are calculated on Schedule 13 of your return, Employment Insurance Premiums on Self-Employment and Other Eligible Earnings. The EI premiums are reported on line 31217 and line 42120 of your return and the premiums are deducted from your refund or added to your tax payable.
Yes, self-employed Canadians can collect EI benefits if they are registered in the self-employed EI program for at least 12 months and meet other eligibility criteria. Self-employed individuals are only eligible for sickness, compassionate care, and maternity and parental benefits.
Yes, you can travel outside of Canada while receiving Employment Insurance (EI) benefits. But there are certain conditions and requirements you need to be aware of to ensure your benefits are not interrupted or affected negatively.
Yes, you can receive Employment Insurance (EI) benefits while on maternity leave in Canada. Maternity leave falls under the EI maternity benefits program, which provides financial assistance to birth mothers who are unable to work due to pregnancy or childbirth.
Yes, you can apply Employment Insurance online. The online application takes about 1 hour to complete.
Employment Insurance (EI) benefits in Canada are generally calculated based on your insurable earnings and employment status rather than whether you are classified as a full-time or part-time employee.
Yes, you can receive Employment Insurance (EI) benefits if you are an apprentice or enrolled in a trade program and you meet all of the eligibility requirements to make a claim.
Yes, immigrants and newcomers to Canada can qualify for Employment Insurance (EI) benefits. However, to be eligible for EI benefits, you must be a resident of Canada and have a valid Social Insurance Number (SIN). You need to have worked in insurable employment and accumulated enough insurable hours to qualify for EI benefits. The number of hours required depends on the unemployment rate in your region at the time of your claim, ranging from 420 to 700 hours in the past 52 weeks. As these amounts and thresholds vary from year to year, you are advised to visit the Canada Revenue Agency (CRA) website for the most up-to-date information.
For most people, the basic rate for calculating Employment Insurance (EI) benefits is 55% of their average insurable weekly earnings, up to a maximum amount. As of January 1, 2024, the maximum yearly insurable earnings amount is $63,200. This means that you can receive a maximum amount of $668 per week. As these amounts and thresholds vary from year to year, you are advised to visit the Canada Revenue Agency (CRA) website for the most up-to-date information.
EI benefits are taxable income in the taxation year in which they're paid. For example, if your EI claim began on December 18, 2022, but you received your payment on or after January 1, 2023, it is income for 2023 and is included in your T4E for the 2023 tax year.
Yes, you can receive Employment Insurance (EI) benefits if you are laid off temporarily. The employer must issue a Record of Employment (ROE), which is filed with Service Canada within five days of an interruption in earnings.
You must return the cheque, or return the money if the government deposited it directly into your bank account. If you do not do this, there could be serious consequences. For example, you could be fined, need to work more hours to qualify for EI benefits in the future, or be charged with a crime.
Yes, you should report your earnings while receiving Employment Insurance (EI) benefits. It's a requirement to accurately report any earnings you receive from any employment or self-employment during the period you are claiming EI benefits.
Employment Insurance (EI) benefits in Canada are calculated based on your previous earnings. The basic EI benefit rate is 55% of your average insurable weekly earnings. As of 2024, the maximum insurable earnings are $61,500 per year, which means the maximum weekly benefit amount is $650. As these amounts and thresholds vary from year to year, you are advised to visit the Canada Revenue Agency (CRA) website for the most up-to-date information.
Payments are only issued after your reports have been processed. You’ll receive your first payment about 28 days after you apply if you're eligible and have provided all required information.
What are the penalties for providing false information on an Employment Insurance (EI) application ?
Depending on the circumstances, if you knowingly make false or misleading statements, you will likely be fined. The amount of the fine varies, but you may have to pay up to 150% of any over payment you received, or three times your benefit rate for every false statement, whichever amount is lower. The value of the over payment is the total of any benefits that you were actually paid plus a percentage of the value of any benefits that you could have been paid because of the fraud.
In addition, the CRA may record a violation on your EI file. If this happens, you will need to work more hours to qualify for EI benefits in the future.
Check for more information here at the CRA website : Employment Insurance and fraud - Canada.ca
Yes, you can receive Employment Insurance (EI) benefits while attending school or training programs. You must first receive permission from Service Canada prior to attending an approved educational institution. You are also required to pay for the training yourself.
Working part-time while receiving Employment Insurance (EI) benefits can impact the amount of benefits you receive, but it doesn't necessarily disqualify you from receiving them.
Employment Insurance (EI) provides support to individuals on parental leave through the EI maternity and parental benefits program. This program offers financial assistance to parents who are taking time off work to care for their newborn or newly adopted child.
You may be eligible for Employment Insurance (EI) benefits if you quit your job, but it depends on the circumstances such as unsafe work conditions, sexual harassment, discrimination, caring for a sick child or other members of the family. For a complete list of these reasons visit Canada.ca
To apply for Employment Insurance (EI) benefits in Canada, follow these steps:
Check for more information here at the CRA website : EI regular benefits: Apply – Canada.ca
To receive EI Regular benefits, you need to demonstrate that you:
The Employment Insurance (EI) program provides temporary income support to unemployed workers while they look for employment or to upgrade their skills.
You can check your FHSA contribution room by the following:
After you filled out Schedule 15 indicating that you have opened your first FHSA and filed it along with your income tax and benefits return, the total of your unused FHSA contributions available to be deducted in a future year will be provided to you on your:
Your FHSA issuer will provide you a T4FHSA - First Home Savings Account Statement slip which will show:
You cannot directly transfer funds out of your FHSAs to any other registered plans including:
Any funds that you transfer out of your FHSAs to any other registered plan that is not an FHSA, RRSP, or RRIF will be treated as both :
Direct transfers out of your FHSAs can only be made to your:
Generally, you can directly transfer property from one of your FHSAs to another of your FHSAs without reducing your FHSA participation room.
To complete a direct transfer between your FHSAs, fill out Form RC721 Transfer from your FHSA to your FHSA, RRSP or RRIF and give it to your financial institution.
Yes, FHSA funds can be used to purchase land to build a home, as long as the intention is for the account holder to use that home as their principal residence. The key requirement is that the home built on the land must qualify as a first home for the account holder under the FHSA rules.
Generally, you can transfer property out of your FHSAs without any immediate tax consequences if it is:
Check for more information here at the CRA website : Withdrawals and transfers out of your FHSAs - Canada.ca
The fees associated with opening or maintaining a First Home Savings Account (FHSA) can vary depending on the financial institution you choose.
The deadline for using the funds in a First Home Savings Account (FHSA) is either:
A withdrawal from an FHSA is not required to be included in your income if it is:
There are three types of FHSAs that can be offered:
The "Application for a First Home Savings Account Identification Number" refers to the process or form used in Canada to apply for an FHSA (First Home Savings Account) Identification Number. This identification number is necessary when opening a new FHSA with a financial institution.
The FHSA Identification Number serves to uniquely identify your FHSA account with the Canada Revenue Agency (CRA) and is used for tax reporting purposes. It allows the CRA to track contributions, withdrawals, and other activities related to your FHSA.
If you overcontribute to your account, there are tax consequences. Expect to pay a 1% tax each month on the highest excess FHSA amount in that month until that overcontributed amount is removed from the account.
Yes, you can contribute to both FHSA and RRSP accounts to the maximum annual limits.
No. This account is only for first-time homeowners who have not lived in a qualifying home that they owned or jointly owned within the past four calendar years
If you opened an account in 2023, you’re able to contribute up to $8,000. If you didn't contribute the full amount, you can put that leftover or carry-over amount in your FHSA in addition to another $8,000. The maximum contribution you can make in 2024 is $16,000, assuming you opened an account in 2023 and didn't make a contribution.
The current FHSA contribution limit is $8,000. This is the first year for these types of accounts, so carry-over amounts will not take effect until next year.
In order to close your FHSA, you must:
You may have an excess FHSA amount if the total of your contributions to your FHSAs and transfers from your registered retirement savings plans (RRSPs) to your FHSAs in a year are more than your FHSA participation room for that year. The penalty for excess FHSA is a tax of 1% per month on the highest excess FHSA amount in that month. You will continue to pay the monthly 1% tax until the excess FHSA amount is eliminated.
Your FHSA participation room for the year is the maximum amount that you can contribute to your FHSAs or transfer from your RRSPs to your FHSAs in the year without creating an excess FHSA amount.
An organization is not permitted to contribute to a holder's FHSA. They can, however, make a contribution on a holder's behalf, for example, by payroll deduction.
You can open more than one FHSA, but the total amount you can contribute to all of your FHSAs and transfer from your RRSPs to all of your FHSAs cannot be more than your FHSA participation room for the year.
No, however, the annual and lifetime limits remain the same.
Contributions to a First Home Savings Account (FHSA) can be made as frequently as you like, subject to the annual and lifetime contribution limits. This means you can make contributions monthly, yearly, or according to any schedule that suits you, as long as the total contributions do not exceed the prescribed limits.
Yes, there is a deadline for using the funds in a First Home Savings Account (FHSA) after opening it. You must use the funds within 15 years of opening the FHSA. After this period, the account must be closed. Alternatively, the account must be closed by the end of the year in which you turn 71, whichever comes first.
No, a First Home Savings Account (FHSA) cannot be used to purchase a home for a dependent or family member. The funds in an FHSA are specifically intended to help the accountholder purchase their own first home.
No, an FHSA (First Home Savings Account) cannot be used to buy a home in another country. The rules governing the FHSA specify that the funds must be used for purchasing a qualifying home in Canada.
No contributions or transfers can be made to a deceased holder's FHSAs after their date of death. Also, transfers cannot be made from the deceased holder's FHSAs to another of the deceased holder's FHSAs, registered retirement saving plans (RRSPs) or registered retirement income funds (RRIFs) .
Distributions from the deceased holder's FHSAs can only be made to (or on behalf of) designated beneficiaries. If no beneficiaries have been designated, the amounts from the FHSA will be paid to the estate of the deceased holder.
Check for more information here at the CRA website : Death and FHSAs - Canada.ca
Yes, contributions to a First Home Savings Account (FHSA) can be deducted from your taxable income. This is one of the key benefits of the FHSA, similar to the tax treatment of contributions to a Registered Retirement Savings Plan (RRSP).
No. You have to be a Canadian resident.
Yes, an FHSA (First Home Savings Account) can be used in conjunction with the Home Buyers' Plan (HBP) in Canada. The FHSA and HBP are both designed to help Canadians save for their first home, and using them together can maximize your savings potential.
For opening or contributing to an FHSA, you have to meet both of the following age conditions:
No, an FHSA (First Home Savings Account) cannot be opened jointly with a partner or spouse. The FHSA is an individual account, meaning it must be opened and maintained by a single individual.
To prove that FHSA (First Home Savings Account) funds are being used for a home purchase, you typically need to provide specific documentation to your FHSA issuer (such as a bank or financial institution). The required documentation generally includes the following:
If you don't buy a home within 15 years, you can transfer the funds accumulated in your FHSA to your RRSP, where you can then withdraw under the HBP.
Yes. You can transfer property between your first home savings accounts (FHSAs) or from your registered retirement savings plans (RRSPs) to your FHSAs without immediate tax consequences, as long as it is a direct transfer.
Check for more information here at the CRA website : Transfers into your FHSAs - Canada.ca
Yes, there are penalties for withdrawing funds from a First Home Savings Account (FHSA) for purposes other than purchasing a first home. The FHSA is designed specifically to assist with buying a first home, and using the funds for other purposes can result in tax implications.
Even if you are unsure about purchasing a home or contributing $8,000, now is an opportune time to consider opening an FHSA. One of the most important benefits of FHSA is that similar to RRSP, contributions to a FHSA are deductible from income. Upon opening your account, you have up to 15 years, or until you reach the age of 71 (whichever comes first), to make contributions and utilize the funds for your first home purchase.
Withdrawals you make to purchase a first home (including the investment income earned) will not be taxable if you are a first-time home buyer and have a written agreement to buy or build a qualifying home with the acquisition or construction completion date of the qualifying home before October 1 of the year following the date of the withdrawal.
If you don't contribute the max $8,000 for one year, the remaining amount (called your FHSA carry forward) carries over to the next year subject to the maximum carry forward amount of $8,000
Canadian residents 18 years or older but not more than 71 years on December 31 of the year you open an FHSA, who have a valid Social Insurance Number (SIN) and are considered a first-time home buyer.
Check for more information here at the CRA website : Opening your FHSAs - Canada.ca
The First Home Savings Account (FHSA) is a new registered plan to help individuals save for their first home. Contributions to an FHSA are generally deductible and can be used to reduce your tax payable.
Form T2200, also known as the Declaration of Conditions of Employment, is a form issued by the Canada Revenue Agency (CRA). Form T2200 is used to certify that an employee is required to incur certain employment expenses as part of their job duties and that they are not reimbursed by their employer.
Yes, you can claim the Disability Supports Deduction even if you are also receiving the Disability Tax Credit (DTC). The Disability Supports Deduction is separate from the DTC and is intended to help offset the costs of disability-related supports and services that enable you to work, attend school, or conduct research.
Yes, you can claim the Disability Supports Deduction retroactively for expenses from previous years, provided that you meet the eligibility criteria and have supporting documentation for the expenses incurred.
Business income includes income from any activity that you carry out for profit or with reasonable expectation of profit.
A business includes any of the following:
7. Employment income is not business income.
Yes, if you are self-employed and you meet the eligibility criteria, you can claim the Disability Supports Deduction for eligible expenses related to your disability.
If you forgot to claim the Disability Supports Deduction in a previous tax year, you can still amend your tax return to include the deduction. Here's what you should do:
Note : If you're unsure about the process or need assistance with amending your tax return, consider consulting a tax professional ( i.e : Softron Tax). They can provide guidance and ensure that you correctly claim the Disability Supports Deduction for the relevant tax year.
You may have to pay penalties if you make false statements or omissions on your tax return, or if you repeatedly fail to report your income.
Check with CRA on the website at : False reporting or repeated failure to report income - Personal income tax - Canada.ca
Yes, self-employed individuals can contribute to Registered Retirement Savings Plans (RRSPs) for tax-deferred savings. Contributions to RRSPs offer tax benefits by reducing taxable income for the year in which the contributions are made. This can result in immediate tax savings, as the contributions are deductible from the individual's taxable income, effectively lowering their tax liability.
If your disability-related expenses were reimbursed by insurance or a third party, the amount you were reimbursed should not be included in your calculation of eligible expenses for the Disability Supports Deduction.
Yes, you can claim the Disability Supports Deduction even if you receive financial assistance for your disability support.
To support your claim for the Disability Supports Deduction, you need to maintain detailed documentation. Here’s what you should gather:
Enter the amount from line 12 of your Form T929, Disability Supports Deduction, on line 21500 of your tax return (Step 3 – Net income).
Expenses must be claimed in the same year they are paid. Unused amounts cannot be applied to another year.
If you have an impairment in physical or mental functions, you may be able to deduct the expenses that you paid in the year so that you could:
If you have an impairment in physical or mental functions, you may be able to deduct the expenses that you paid in the year so that you could:
The Disability Supports Deduction is a tax deduction available to individuals with disabilities in Canada to help offset the cost of specific expenses incurred for support services and devices that enable them to work, go to school, or conduct research for which they have received a grant.
Check with CRA on the website at : Line 21500 – Disability supports deduction - Canada.ca
The penalty for failing to file any of the foreign reporting information returns is the greater of either $100 or $25 per day for each day that the return is late (maximum of $2,500).
The 5% penalty is levied when the failure to file for a year is done knowingly or under circumstances amounting to gross negligence.
For example, if a person fails to file for the 2019 tax year and the failure continues for more than 24 months, the 5% penalty will be levied on the cost amount of foreign property owned in 2019. The 5% penalty is levied only once and is not per year.
If the same person continues to own the foreign property in 2020 and again fails to file the information return for a period of more than 24 months, the 5% penalty will be levied on the cost of the property that should have been reported for the 2020 tax year. The penalty for 2020 is separate from the one in 2019.
If the person owned no foreign property in 2020 for which Form T1135 was required to be filed, there would be no additional penalty.
You can ensure that your expenses qualify for the Disability Supports Deduction before filling by:
Incorrectly claiming the Disability Supports Deduction can have several consequences. It's important to ensure that you meet all the eligibility criteria and properly document your claims. Here are the potential consequences of making an incorrect claim :
For purposes of the 5% penalty, the cost of foreign property is the cost amount of the property, as defined in subsection 248(1) of the Income Tax Act.
File your Canadian taxes if living abroad by following the steps:
Yes, you may need to report foreign bank accounts to the Canada Revenue Agency (CRA) under certain circumstances. Check for more information on reporting foreign income here at the CRA website: Questions and answers about Form T1135 - Canada.ca
Advantage – any benefit, or debt that is conditional on the existence of the RESP, subject to certain exceptions for normal investment activities and conventional incentive programs.
An advantage also includes any benefit that is an increase in the total fair market value (FMV) of the property of the RESP that is reasonably attributable to any one of the following:
No, out-of-pocket expenses for prescription medications are not eligible for the Disability Supports Deduction. However, these expenses can typically be claimed under the Medical Expense Tax Credit (METC) instead.
You may have to pay a federal and provincial or territorial penalty if you fail to report an amount of $500 or more on your :
The penalty is whichever amount is less :
On or after June 25, the inclusion rate of 50% still applies to the first $250,000 of capital gains. Only any excess gains above $250,000 that were realized after June 25 would be subject to the new 66.67% rate.
Check for more information here on our blog about how capital gains taxed in Canada : Navigating the New Capital Gains TaxAfter you file your tax return, the CRA will issue a Notice of Assessment (NOA). The NOA provides a detailed summary of your tax return, including any adjustments made by the CRA. To verify your claim.
You may have to pay a penalty if you, knowingly or under circumstances amounting to gross negligence, made a false statement or omission on your 2023 return.
The penalty is whichever amount is more :
You can mail your tax return to this address: Sudbury Tax Centre , 1050 Notre Dame Avenue Sudbury ON P3A 5C2
Yes, you can claim the Canada Caregiver Amount if you are the legal guardian but not the biological parent of an infirm child, provided that you meet all the eligibility criteria set by the Canada Revenue Agency (CRA).
Check for more information here at the CRA website: Canada caregiver credit - Canada.caThe impairment can be physical, mental, or both. It must significantly affect the individual's ability to perform everyday activities.
The impairment must be prolonged, which the CRA generally interprets as lasting, or expected to last, at least 12 months continuously.
The person with the impairment must be dependent on you for their care. This dependency can be demonstrated through their need for assistance with basic activities of daily living or a significant amount of personal care and support.
Check for more information here at the CRA website: Canada caregiver credit - Canada.caYes. The CRA may ask for a signed statement from a medical practitioner showing when the impairment began, the duration of the impairment is expected to be, and the name of the caregiver who is claiming the credit.
Claiming the Caregiver amount does not reduce the GST/HST payment since GST/HST payment are calculated based on family income.
Yes, you can still claim the Canada Caregiver Amount even if your child receives disability benefits. The Canada Caregiver Amount is a non-refundable tax credit that provides tax relief for individuals who have a spouse, common-law partner, or dependant with a physical or mental impairment.
You can apply to cancel or waive penalties and interest by following:
The Canada Caregiver Amount is a non-refundable tax credit, which means it can reduce the amount of federal tax you owe.
You will have to complete two steps.
If the eligible dependent’s net income is between $8,021 and $26,782, you may be able to claim up to $7,999 on line 30425 of your return.
Yes. You can claim the caregiver amount for each dependant who meets the eligibility criteria. The Canada Caregiver Amount is typically claimed for a spouse, common-law partner, or dependant over 18 years old with a physical or mental impairment.
Calculate the net income for the person you are claiming this amount for, as shown on line 23600 of their return (or the amount it would be if they filed a return). Complete line 30300 or line 30400, whichever applies, and line 30425 on your Schedule 5 to calculate the amount that you can claim.
If you have a spouse or common-law partner and are unable to claim the Canada caregiver amount on line 30425 of your return for an eligible dependant age 18 or older, you may be able to claim the Canada caregiver amount for other infirm dependants age 18 or older on line 30450 of your return.
The CRA may ask for a signed statement from a medical practitioner showing when the impairment began and what the duration of the impairment is expected to be.
For children under 18 years of age, the statement should also show that the child is, and will likely continue to be, dependent on others for a long and continuous period because of an impairment in physical or mental functions. (Dependent on others means that the child needs much more help for their personal needs and care compared to children of the same age.)
You do not need a signed statement from a medical practitioner if the CRA already has an approved Form T2201, Disability Tax Credit Certificate, for a specified period.
Yes, you can claim the Canada Caregiver Amount if your infirm child does not live with you, provided that you still contribute to their support.
To determine if your child qualifies as "infirm" for the purposes of claiming the Canada Caregiver Amount, you need to meet the following criteria:
If you are eligible for the Canada caregiver amount for your spouse or common-law partner (see line 30300) or an eligible dependant 18 years of age or older (see line 30400), and their net income is between $8,021 and $26,782, you may be able to claim up to $7,999 on line 30425 of your return.
The Canada Caregiver Amount for infirm children under 18 years of age is a non-refundable tax credit available to individuals who support a dependent child under 18 with a physical or mental impairment.
You can claim this credit if you were a resident of Ontario at the end of the tax year and you contributed to a registered Ontario political party or constituency association, or to a candidate in an Ontario provincial election.
Only claim contributions you made during the tax year. If you were bankrupt in the year, your political contribution tax credit is based on contributions made during all of the tax year.
You or your spouse or common-law partner can claim the credit, but a contribution cannot be divided between the two of you if only one receipt was issued.If you were bankrupt at any time in 2023, you cannot claim this tax credit on any return for a tax year ending in 2023.
The Ontario Political Contribution Tax Credit is a non-refundable tax credit available to individuals who make monetary contributions to registered Ontario political parties, constituency associations, or candidates. This credit helps to reduce the amount of provincial income tax owed by providing a percentage back on the contributions made, up to certain limits.
You may be eligible to claim this credit if all of the following conditions applied:
- 1. You or your spouse or common-law partner (if you had one in 2023) were 70 years of age or older on December 31, 2023
- 2. You were a resident of Ontario at the end of the year
- 3. You claimed an amount at line 58769 of Form ON428
- 4. Your family's net income is less than $65,000 which is the total of the following amounts:
- 4.1 your net income (line 23600 of your return)
- 4.2 your spouse's or common-law partner's net income (line 23600 of their return), if you had one on December 31, 2023
A qualifying payment is an amount paid for any of the following:
You can claim the Ontario seniors' public transit tax credit (OSPTTC) if all of the following conditions apply:
The Senior Public Transit Tax Credit was a non-refundable tax credit available to eligible seniors in Canada. It allowed seniors aged 65 and older to claim a tax credit for the cost of public transit passes, including monthly passes and annual passes, for travel within Canada on eligible public transit services
You do not have to report Lottery Winning of any amount as income, unless the prize can be considered income from employment, a business or property, or a prize for achievement.
You are eligible for the basic amount of the CWB if you meet all the following conditions:
The Canada Workers Benefit (CWB), formerly known as Canada Working Income Tax Benefit, is a refundable tax credit to help individuals and families who are working and earning a low income. The CWB has two parts: a basic amount and a disability supplement. You can claim the CWB when you file your income tax return.
Tax deductions reduce your taxable income, while tax credits directly reduce the amount of tax you owe. Charitable donations are eligible for both deductions and credits, with the amount varying depending on the donation and your tax situation.
Donating property instead of cash can still result in a tax deduction based on the fair market value of the property at the time of donation. However, there may be additional rules and considerations for certain types of property.
Check for Capital gains realized on gifts of certain capital property : Capital gains realized on gifts of certain capital property - Canada.ca
Yes. Donations made through crowdfunding platforms can be eligible for tax deductions if the recipient qualifies as a registered charity or qualified donee.
You typically need a receipt or acknowledgement from the charity for donations over $20. For non-cash donations, you may need additional documentation such as appraisals or receipts detailing the items donated.
Yes. There are limits based on your income. Generally, you can claim up to 75% of your net income in charitable donations, but this may vary depending on the type of donation and your personal tax situation.
Donations made to foreign charities are not eligible for tax deductions unless the charity qualifies as a registered foreign charitable organization with the Canada Revenue Agency (CRA).
Check for Registered charitable organization here on CRA website : List of charities and certain other qualified donees - basic search (cra-arc.gc.ca)
The value of non-cash donations, such as clothing, household items, or securities, is typically based on fair market value at the time of the donation. Receipts or appraisals may be required for high-value items.
Find more information on how to determining the value of non-cash donations on the CRA website: Determining fair market value of gifts in kind (non-cash gifts) - Canada.ca
Charitable donations made to registered charities can be claimed on your tax return. The tax credit for donations is generally 15% for the first $200 and 29% (or higher, depending on your income) for amounts over $200.
Your TFSA contribution room information can be found by using one of the following services:
No. You do not need to submit a receipt for your TFSA contributions when filing your taxes. However, it's crucial to keep track of your contributions and withdrawals for your records and to ensure you stay within your contribution limits.
A TFSA is a registered savings account that allows your investments to grow tax-free. Contributions are not tax-deductible, but withdrawals of contributions and earnings are tax-free.
Yes. If you cannot pay your tax debt in full, you can contact the CRA to arrange a payment plan. This will allow you to pay your debt over time while avoiding further collection actions.
You can schedule a series of payment in My account or call the CRA to set up your payment arrangement at 1-866-256-1147.Find more information on the CRA website at: Arrange to pay your debt over time - Payments to the CRA - Canada.ca
You must convert your RRSP to a Registered Retirement Income Fund (RRIF) or annuity by the end of the year in which you turn 71. Withdrawals from a RRIF are taxable as income.
Yes. You may be liable to pay taxes on the capital gains if you sell one of the houses, depending on various factors such as the usage of the property, its designation as your primary residence, and the duration of ownership.
If the house you sell is considered your primary residence for tax purposes, you may be eligible for the Principal Residence Exemption (PRE), which allows you to shelter some or all of the capital gains from taxation. However, if the property is not designated as your primary residence or if it is considered an investment property, you may be subject to capital gains tax on any profit earned from the sale.
The answer to this question depends on the duration of ownership, frequency and intention of the seller. As per CRA rules, Canadian residential properties sold by taxpayers who held the properties less than 365 days to be a “flipped property,” unless the taxpayer can establish that they disposed of the property due to:
Check CRA link for reference : Residential Property Flipping Rule - Canada.ca
The foreign currency amount should be converted using the Bank of Canada exchange rate in effect on the day of the transaction.
Check for Bank of Canada exchange rate at : Exchange Rate
When filing taxes for a previous year, such as the tax year 2021, you should use Bank of Canada exchange rates that were in effect during that specific tax year. Exchange rates can fluctuate daily, so it's important to use the rates that correspond to the tax year in question to ensure accuracy in your tax calculations.
The expenses you might incur to earn income from your activities. Incur means you paid or will pay the expense. The amount you can deduct in a given year for any expense depends if it is considered a current year expense or capital expense.
You can find more information about business expenses on the CRA website: Business expenses - Canada.ca
Yes you can. If the amounts paid for cannabis, cannabis oil, cannabis plant seeds, or cannabis products purchased for medical purposes from a holder of a licence for sale (as defined in subsection 264(1) of the Cannabis Regulations). The patient must be a holder of a medical document (as defined in subsection 264(1) of the Cannabis Regulations). The Cannabis Regulations require that the patient be registered as a client of the holder of a licence for sale and require the patient to make their purchases from the holder they are registered with.
Where a patient has a registration certificate that allows them to legally produce a limited amount of cannabis for their own medical purposes, the cost of growing and producing cannabis for medical purposes (other than the cost of cannabis plant seeds and cannabis), such as pots, soil, nutrients, and lights, is not an eligible medical expense.
As a self-employed individual in Canada, you are responsible for paying taxes on your income because you are considered both the employer and the employee of your business. Here are several reasons why you owe taxes on your self-employed income:
If you want to destroy your records before the six-year period is over, you must first get written permission from the director of your tax services office. To do this, either use Form T137, Request for Destruction of Records, or make your own written request.
For more information : Click here
You have to keep records for each year you claim expenses. You should retain all tax receipts corresponding to the amounts you have claimed on your tax return as per CRA guidelines.
Check for more information on what records should be kept on the CRA website at: Click Here
Without the necessary documentation, the CRA may reduce or disallow your claim. It's essential to retain all records to support your tax deductions and credits in case of a review or audit by the CRA. One possible solution is to obtain duplicate of the receipts where possible.
Without the necessary documentation, the CRA may reduce or disallow your claim. It's essential to retain all records to support your tax deductions and credits in case of a review or audit by the CRA. One possible solution is to obtain duplicate of the receipts where possible.
I6 years - The Canada Revenue Agency (CRA) has the authority to review your tax history, which spans six years. During this period, you are legally obligated to retain old tax returns and associated documentation.
International students in Canada may be eligible for various tax deductions and credits to help reduce their tax liability. Some common deductions and credits available for international students include: Tuition and Education Amounts, Medical Expenses, Moving Expenses, Child Care Expenses, GST/HST Credit, Canada Carbon Rebate, Rent and Property Tax Credits.
Yes. You may still need to file a tax return in Canada even if you don't owe any taxes. You may not receive the benefits you are entitled to without filing a tax return.
The tax deadlines for Uber/Lyft drivers in Canada are typically the same as for other taxpayers. They are required to file their income tax returns by April 30th. of the following year. However, if April 30th. falls on a weekend or holiday, the deadline is extended to the next business day.
You are considered a non-resident for income tax purposes if you:
Instalments are periodic income tax payments that have to be paid on certain dates. These payments cover the tax that you would normally have to pay in a lump sum on 30 April of the following year.Instalments are not paid in advance; they are paid during the calendar year in which you are earning the taxable income.
If you earn income that has no tax withheld, or does not have enough tax withheld for more than one year, you may have to pay tax by instalments. This can happen if you earn rental, investment, or self-employment income, certain pension payments, or income from more than one job.
Rental losses can be used to offset income from other sources. If your rental loss surpasses your income from other sources, it is considered a Non-Capital Loss and can be carried back or forward to reduce your tax liability in other years.
You can deduct part of your maintenance costs such as heating, home insurance, electricity, and cleaning materials. You can also deduct part of your property taxes, mortgage interest and capital cost allowance (CCA).
Yes, you must report rental income in Canada, even if it’s from a family member.
You're eligible to subtract the expenses of repairing your rental property, including labor costs. These expenses should be immediate and focused on restoring the property to its original state rather than enhancing its value.
Depending on the class of asset, you may deduct the Capital Cost Allowance (CCA) over several years. This means you can write off the capital cost of the property including the purchase price, legal fees associated with the purchase of the property, and cost of equipment and furniture that comes with renting a building.
Rental income is generally taxed differently than earned income. It falls under the umbrella of passive income. What's noteworthy here is that landlords may deduct reasonable expenses incurred to earn rental income. This includes utilities, mortgage interest, property taxes, insurance, maintenance costs, and advertising expenses.
All funds obtained from an accommodation sharing arrangement are taxable for income tax purposes, and you're required to declare them as rental income when completing your income tax returns.
Income generated from renting out property is typically classified as passive income rather than self-employment income. Passive income refers to earnings from activities where the taxpayer isn't regularly and significantly involved. However, if you actively manage the rental property as a business, offering substantial services beyond typical property management tasks, the rental income might be treated as business income and subject to self-employment taxation.
When you earn rental income, you must disclose that income on your tax return. If you co-own a property, you will report only your portion of the income. This income is taxed at your marginal rate, similar to interest income.
Dividends do not count as eligible income for generating RRSP contribution room, meaning you won't gain a deduction from them. However, the marginal tax rate applied to dividends, which varies based on your province of residence, typically falls between 30% and 40%.
Certainly! Even if you are self- employed, you're still eligible to contribute to an RRSP as long as you have a contribution room. Registered Retirement Savings Plans, are open to both employees and self-employed. They're designed to help you save for retirement while also giving you tax benefits
In most cases, the online content shared by social media influencers on various platforms is subject to taxation. If the earnings from these activities surpass $30,000 within four consecutive calendar quarters, influencers are obligated to register with the CRA, collect, and submit the applicable Goods and Services Tax/Harmonized Sales Tax (GST/HST).
When reporting self-employment income from the previous year, differentiate between T4 and T4A slips. While similar, T4 slips provide more detailed information on employee payroll contributions, unlike T4A slips, which are typically used for self-employment income.
At age 65, you have the option to stop your post-retirement contributions. Your CPP contributions will stop when you reach 70 years of age, even if you're still working.
It is possible to both work for yourself and hold an employee position at the same time. Whether you're self-employed full-time or have a side hustle alongside your regular job, you'll need to include a self-employment schedule when filing your tax return.
Your past employment record doesn't affect your eligibility for the Old Age Security (OAS) pension. Regardless of whether you've never worked or are still working, you can qualify for the OAS pension. If you're residing in Canada, you must be 65 years of age or older. Canada Pension Plan (CPP) however depends contributions from the work you did in Canada or as a result of receiving credits from a former spouse or former common-law partner at the end of your relationship.
The CPP is a mandatory pension program financed by contributions from employees, employers, and self-employed individuals. It covers the majority of Canadian workers, except for those in Quebec, who are covered by a separate program called the Quebec Pension Plan (QPP).
Employment Insurance (EI) offers a program tailored for self-employed individuals. If you're self-employed or own over 40% of your corporation's voting shares, this program allows you to contribute and access special benefits 12 months after the initial registration.
Self-employed people must pay both the employee and employer portions of CPP contributions. The amount payable is calculated on the self-employed person's personal income tax return.
Important taxes to keep in mind are:
Some of the common self-employment tax forms include:
As a self-employed individual, you have several tax obligations to fulfil. Here are the key points:
If you engage in selling products or services, you probably have business income. Professional income pertains to earnings generated by individuals offering services leveraging their specialized knowledge, skills, or expertise in a specific field.
Fill out the Statement of Business or Professional Activities (Form T2125) to report your self-employed income and expenses. Report the self-employment income's gross and net figures (or loss) on lines 13499 to 14300 of your return. Indicate any losses by enclosing them within brackets.
In Canada, small businesses frequently have the opportunity to reclaim the Harmonized Sales Tax (HST) paid on qualifying business expenses through what is known as an Input Tax Credit (ITC). Registered small businesses under the HST/GST (Goods and Services Tax) system can utilize ITCs to recover the HST paid on these expenses, essentially resulting in a refund.Yet, the eligibility to claim ITCs hinges on various factors, such as the type of expenses and their connection to taxable supplies provided by the business.
Here's how to report passive income on your taxes:
If you're unsure or your situation is complex, consider consulting a tax professional.
The Canada Revenue Agency (CRA) considers you self-employed if you run a business as a sole proprietor, are a partner in a partnership, or work independently without a business name. Self-employed individuals generally control their work, bear the financial risks of their business, and have the potential to profit from their business activities.
Key factors the CRA considers when determining self-employment include:
Self-employed individuals must manage their own tax obligations, which include remitting GST/HST, paying both the employer and employee portions of CPP contributions, and keeping track of business expenses and revenues.
You have to report all business income regardless of amount. In case of HST however, you only have to charge HST when one of following applies:
In Canada, the amount you earn in tips and gratuities is considered to be income, and you must report all of it on your tax return.
Yes, you can carry forward donations that you made to registered charities and other qualified donees to future years if you do not use the entire amount in the current year.
Property flipping is buying and selling of real estate with the intention of making quick profits. This typically involves purchasing a property at a relatively low price, making improvements or renovations to increase its value, and then selling it at a higher price within a short period, often within a year or even a few months.
Filing late may also cause delays to your benefit and credit payments. If you cannot pay your balance owing, you should still file on time to avoid being charged the late-filing penalty. The late-filing penalty is 5% of your 2023 balance owing, plus an additional 1% for each full month that you file after the due date, up to a maximum of 12 months.
After the CRA has assessed your first tax return, you can register for CRA My Account. This online service allows you to conveniently keep track of your tax information in one place.
Your tax obligations in Canada depend on your residency status. If you stay in Canada for 183 days or more in a given tax year, you are considered a deemed resident of Canada for tax purposes. On the other hand, if you do not establish significant residential ties with Canada and live outside the country throughout the year or stay in Canada for less than 183 days, you may be considered a non-resident.
Depending on your tax situation and family structure, you may be eligible for various benefits and tax breaks as a newcomer to Canada. Some possible credits and benefits include the Canada Child Benefit (CCB), the Goods and Services Tax/Harmonized Sales Tax (GST/HST) credit, the Canada Carbon Rebate (CCR), and other provincial and territorial benefits and credits.
You must report your foreign-source income from the part of the year before you immigrated to Canada because this amount is used to determine if you meet the 90% rule. When you meet the 90% rule, you can claim the full amount of all Canadian tax credits, even though you didn’t live here all year. If you don’t meet the 90% rule, several credits must be pro-rated based on your date of entry.
You meet the 90% rule if, in the part of the year before you moved to Canada:
You must complete Form T777-Statement of Employment Expenses or Form T777S and get a completed and signed Form T2200 or Form T2200S from your employer.
Filing late may also cause delays to your benefit and credit payments. If you cannot pay your balance owing, you should still file on time to avoid being charged the late-filing penalty. The late-filing penalty is 5% of your 2023 balance owing, plus an additional 1% for each full month that you file after the due date, up to a maximum of 12 months.
Yes, you can file taxes after the deadline in Canada, but it’s important to be aware of the consequences. If you owe taxes, you may face penalties and interest for late payment. However, if you’re entitled to a refund, you won’t be penalized for filing late.
The medical expense tax credit is a non-refundable tax credit that you can use to reduce the taxes you have paid or may have to pay. If you paid taxes on your employment income and your healthcare expenses exceed 3% of your taxable income, you may be able to claim them as eligible medical expenses on your tax return.
When your marital status changes, your benefit and credit payments are directly impacted. The CRA will recalculate your benefits and credits based on your updated family net income:
When it is time to file your income tax, it doesn't matter if you live in one province or territory and are employed and pay taxes in another. You file your income tax for the province or territory in which you reside on December 31 of the tax year.
Yes, taxation can vary depending on where you live in Canada. The federal government imposes taxes that apply uniformly across the country, such as federal income tax. However, provinces and territories have their own tax systems and rates, including income tax rates, sales tax (such as the Goods and Services Tax or Harmonized Sales Tax), property tax, and various other taxes and fees.
Child support payments are not counted as income for the recipient in Canada. Similarly, they are not tax-deductible for the payer. This means that if you receive child support payments, you do not need to report them as income on your tax return. Likewise, if you make child support payments, you cannot claim them as a deduction on your tax return.
Home renovations can only be claimed under two circumstances :
If you have moved to a new home to work or to run a business out of a new location, you can deduct eligible moving expenses from the employment or self-employment income you earned at your new work location.
If you cannot use any of the moving expenses in the year you move, you can carry forward the expenses and deduct them in a future year.
You, your spouse or common-law partner can claim up to a combined amount of $10,000 on your return. You can apply the whole $10,000 credit on your tax return, or share it with your spouse or common-law partner.
After you leave Canada, as a non-resident, you pay Canadian income tax only on your Canadian source income. However, only certain types of Canadian source income should be reported on your return, while others are subject to non-resident withholding tax at source.
If you sold your principal residence in Canada or deemed to have sold it, you have to complete Form T2091(IND), Designation of a Property as a Principal Residence by an Individual (Other Than a Personal Trust). In addition you will need to report the sale and designate the property as your principal residence on Schedule 3-Capital Gains (or Losses).
According to the updated regulation on flipped properties, any profit made from selling a residential property in Canada after 2022, which was held for less than a year, is now regarded as entirely subject to taxation as business income, irrespective of the original intent behind the purchase.
Yes, unless you are a temporary resident. To apply for the benefit you must be a resident of Canada for 18 months in a row and have a valid permit on your 19th month of your residency in Canada before you can apply for the Canada Child Benefit and/or any related provincial and territorial programs.
Some of the common slips include:
The portion of rental income or loss from a jointly owned rental property hinges on your ownership stake. Consistency in reporting the rental income or loss percentage is crucial, aligning with your ownership share, unless there's a change in your property ownership percentage.
Over the years, businesses have seen these fees risen, especially smaller businesses who often pay much more than larger companies to accept credit cards making it more difficult for them to compete with large companies. After consultation with several major credit card companies, on October 6, 2022, the Canadian Federation of Independent Business (CFIB) announced that businesses are now allowed to charge a processing fee for payments by credit card.
You should take following factors into account.
- How many miles are you expecting to travel? If you expect to have a lot of mileage then most leasing companies, charge additional fees over certain mileage. This information should be specified in leasing contract. You have to determine how much extra you have to pay over specified mileage. Then it might not be to your advantage to lease a car.
- How often do you change a vehicle? Are you the type of person who changes a vehicle after two to three years or do you like to keep the same vehicle for five to ten years. It is better to lease if only keeping the vehicle for a short period of time.
- Cash flow? Do you have enough cash to purchase a vehicle. If not, it may be better for you to lease. Since leasing a vehicle is easier for a person with bad credit rating.
- Legal Issues: Do you have any court order against you, i.e. owe money to other people or in the course of divorce settlement. If so, then any of your assets may be seized or distributed. Then it might be better for you to lease a vehicle.
- Tax Point: From a tax point of view, the difference between buying and leasing is minimal.
You have to look at other factors to determine what is the best decision for you.
