Canadian Tax Podcast 008: Incentive payments; Climate Action Incentive; US Double Tax;

Canadian Tax Podcast for the week of April 19, 2021. This week we cover:

[INTRO]:

“This is the Canadian Tax Podcast, Episode # 008, hosted by me, Cameron Ware. Good morning”

Last week Revenue Quebec extended the personal tax filing deadline.
Dates still stay the same, but they won’t implement late filing fees if you file after April 30^th, but before May 31^st..
Interesting to see what CRA does.
CPA Canada continues to push for extension
https://www.revenuquebec.ca/en/coronavirus-disease-covid-19/faq-for-individuals/summary-table/
https://www.cpacanada.ca/en/business-and-accounting-resources/taxation/canadian-tax-news

Today April 19^th is budget day.
First budget released in two years.
CBC leak says that it will cover a national daycare strategy, along with some luxury tax items.
Supposedly staying away from capital gains tax changes.
https://www.cbc.ca/news/politics/federal-budget-child-care-deficit-1.5992631

CRA, in one of their “Tax Tips” has stressed that it’s important to file your taxes prior to April 30^th.
If you want to apply for financial aid for May 1^st and forward, you need to have filed your tax returns in order to be eligible.
Specific programs that could have proglems are the Canada Recovery Benefit (CRB), the Canada Recovery Caregiving Benefit (CRCB) or the Canada Recovery Sickness Benefit (CRSB)
https://www.canada.ca/en/revenue-agency/news/newsroom/tax-tips/tax-tips-2021/still-time-file-taxes-by-april-30-2021.html

So venting a little bit here.
For those of you who aren’t accounting nerds, CPA is phasing in new standards for Compilation engagements. So in normal-speak, if you’re a client, your accountant now HAS to do a bunch of extra stuff on your file, or go to jail.
So here’s the rub: CPA Canada changes the rules, saying you NEED to do this, or else.
Then, helpfully provide a new guide called “Practice management, advisory, compilations and tax” guide. PACT.
Yours for only $395.
So, governing body changes the rules. Then, in order for members to get guidance on how to comply with the new rules, CPA Canada charges you extra.
When is CPA Canada going to actually support smaller members? (ie. Meaning the outfits who don’t audit public companies…)
Law Society of Canada and provinces provide tons of support to their respective members. FREE support. Here’s AB. https://www.lawsociety.ab.ca/resource-centre/key-resources/practice-management/law-firm-start-up-kit/
https://www.cpacanada.ca/en/business-and-accounting-resources/audit-and-assurance/standards-other-than-cas/publications/pact?utm_source=aprilemail&utm_medium=email&utm_campaign=PACT2021

Where to report incentives?
- [quote]
- Typically this goes to offset bank charges/interest.
- Misc revenue or expense recoveries is the alternative if you want.
Climate Action Incentive: How Do I Get The Money?
- [quote]
- So the CAI is processed right on your tax return.
- Added as an “extra refund”.
- Amount depends on spouse, kids, outside urban area, etc.
Double-Tax on US income
- [quote]
- Cross-border stuff is tricky. I won’t get into the weeds here. Simplest answer is you’re likely missing the foreign tax credit claim on your Cdn tax return.
- Functionally: You get paid from US outfit, pay US tax.
- You show the full amount of income from your US job on your Cdn tax return.
- DOUBLE-TAX right now.
- However, claim foreign tax credit. Eliminates double tax.
- Pro-tip: File US 1040NR return, get back all of the US tax.
- Also, watch forex.

That will wrap things up for today. Like always, if you have any questions, send them to questions@canadiantaxpodcast.ca, or find us on twitter: https://twitter.com/cdntaxpodcast

This is Canadian Tax Podcast, thanks for listening.