Canadian Tax Podcast for the week of 23 November 2021. This week we cover:
- US electric vehicle subsidy;
- GST filing extension for the E-Commerce Framework (AKA: Netflix Tax reporting);
- 2022 TFSA limits announced;
- Transferring intangibles from proprietorship to corp;
- Home office: part-time vs full-time use of space;
- Informal expense reimbursements;
“This is the Canadian Tax Podcast, Episode # 025, hosted by me, Cameron Ware. Good morning”
- “Happy Tuesday, it is the week of November 23, 2021. We’ll start with the news.
ITEM  – What Canada could do to combat US EV Tax Credit Article
- We’ve discussed over the last few weeks the new US EV tax credit
- CBC covered what Canada might do if they deal were to go through, even though US officials have noted Canada’s displeasure with the proposal
- Quick summary: the US is subsidizing up to $12,500 if consumers buy an electric vehicle. The catch is the subsidy only applies to US-made vehicles. This makes Cdn manufacturers grumpy.
- One option Cdn govt could use: Cdn mines are a reliable source for the electric batteries. Why does the taxpayer care: Because regardless of the politics involved, tariffs are taxes. Canada applies tariffs somewhere, US does the same, = taxes go up
[ITEM 2] – Obligations for new Gst/HST rules
- The CRA announced new rules for GST/HST for digital economy businesses earlier this year.
- These are the rules for “Foreign suppliers” of digital goods. AKA the “Netflix tax”.
- Supposed to kick in on July 1.
- The CRA has deferred the GST return filing requirement for the first calendar year information return.
- However, suppliers still need to notify/register with CRA if the supplier provides specified services. (Storage/fulfillment warehousing, Digital platform operators)
[ITEM 3] – TFSA Limit for 2022 ANnounced
- New TFSA limit was announced for 2022
- The new limit is $6000, matching previous amounts from 2019-2021
- If you’re able, definitely max these each year if you can. Tax-free returns are always a good thing.
- All the other usual limits can be found at the link below. RRSP.
- Sole proprietor artist wanting to transfer assets
- This is like any property transfer. Proprietorship, Sec 85 over to corp.
- Watch: Passive income trap.
- Home office deduction in studio apartment
- If I’m understanding correctly, listener filed one way, wants to change to “Dedicated” space.
- Need T2200 if for employment. Or T2125 if self-employed. Pro-rated on basis of sq/ft for business vs. sq/ft for home.
- How can business partner deduct expenses if they are paid on one card?
- One party is purchasing Facebook and Instagram ads, but the expenses are actually 50/50.
This is Canadian Tax Podcast, thanks for listening.