Canadian Tax Podcast for the week of March 29, 2021. This week we cover:
- Coinsquare account info release;
- Carbon tax;
- Federal Budget announced;
- Ontario Budget released;
- Expense/deduction planning for the newly self-employed;
- T1135 reporting re. personal use property and foreign currency;
- Sale of property in a corporation, triggering capital gains;
“This is the Canadian Tax Podcast, Episode # 005, hosted by me, Cameron Ware. Good morning”
- “Happy Monday, it is the week of March 29, 2021. We’ll start with the news.
[ITEM 1] – COinsquare to hand over info
- Federal judge ordered Coinsquare to hand over client info;
- Threshold for reporting was accounts holding over $20,000;
- Goes back to Jan 01/13;
- Uses CRA tool called “Unnamed Persons Requirement”
- From CRA’s site: “enables the CRA to obtain information from an individual or a company about third parties. After the CRA gets this information, it can verify if the unnamed person correctly reported income and sales tax…”
[ITEM 2] – Carbon Tax
- Supreme Court ruled 6-3 in favour of Feds pushing a carbon tax.
- Alberta/West unhappy.
[ITEM 3] – BUDGET ANNOUNCED
- Last week Freeland announced new Budget.
- Date set for April 19th 2021.
- Freeland Quote during question period: “Canada entered this global pandemic in a strong fiscal position, which allows our government to provide unprecedented support to Canadians. We will continue to do whatever it takes to support Canadians and Canadian businesses, and we have a plan for jobs, and robust growth,”
- I hope so. End of March/19 deficit was $19.7bil. At the end of 2020, at about $381bil.
ITEM  – Ontario Budget
- March 24, Ontario budget released;
- Run a $33bil deficit;
- On track to balance in 2029/20
- Newly self-employed.
- Yes, use an tax calculator and plug/play numbers;
- Buy some tax software and model;
- Pro-tip: Use Excel;
- Best bet: get an accountant to model;
- Personal Use Property/T1135
- Does not need to be reported. “Specified” foreign property.
- “a personal-use property as defined in section 54 of the Act.”
- Good rule: Not income-producing.
- Report on Schedule 3
- Question about foreign currency from sale. If it’s held in a US bank account, sits in a US bank account, earns interest in a US bank account, yes. Sitting in a lawyer trust account waiting to transfer to CDN account? Beneficial ownership, maybe not.
- Thing about T1135 is it doesn’t hurt to file anyway. It’s a disclosure form.
- Sale of Land
- Tax at corp level, tax at personal level;
- Corp: $550/2 = $275k CDA, $275k pay corp tax.
- Artificially-high tax “Refundable tax”, until you pay out a dividend = trigger refund of RDTOH.
- CDA = T2054 CDA election
- Date things correctly, pay out the balance.
- Personal portion: Pay out dividends over time, keep in low tax rate.
That will wrap things up for today. Like always, if you have any questions, send them to firstname.lastname@example.org, or find us on twitter: https://twitter.com/cdntaxpodcast
This is Canadian Tax Podcast, thanks for listening.
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