Etter Macleod & Associates

Tax season opens once again. Stay safe, good people; pay only what you must!

I can’t stress enough that even though it stresses some people to the point of paralysis, it’s better to file on time, even if the tax bill is more than you can cope with. The problem won’t go away by avoidance and why take the outrageous penalties CRA imposes?

Under utilized housing tax is now alive and cruising through uncharted waters. If you own real estate other than your home, search it up and act before the deadline to file…just another new tax, nothing to see here folks, just keep moving….

Heads up about the sport credit the NS government is offering this year, it almost offsets 2% of the tax differential between Nove Scotia and some other provinces….

So time is limited, Efile opened today for 2022 taxes but the RRSP deadline is in less than 10 days…give some serious thought to making contributions and lowering the taxes due!

What we do for clients, you can easily do for yourself. Do up a mock tax return for 2021 now, plug in different amounts for RRSP contributions and see what happens. Try changing your province of residency to see what living in NS as compared to other provinces is like from a tax perspective. Life change coming? Change your relationship status or add/age out dependents to simulate the tax effect. Other than the RRSP contribution, there's not much that can be done about the outcome or your tax bill but it does help with planning for 2022!

The RRSP deadline 2022 is the 1st of March. It's a great time to plan and contribute, small amounts monthly blend out purchase risk compared to lump sum payments...especially as the deadline nears!

The 2020 tax year is all but over, stragglers notwithstanding. Are you happy with your tax bill? Do you know what it was? So many don’t take advantage of systemic opportunities to defer or reduce taxation. We all contribute for the common good, but we also need to prepare for future considerations and self care. Be aware and make a plan, any plan is better than none. If you need help, seek it out.

The deadline approaches...a difficult year for so many taxpayers suddenly burdened with unexpected tax bills. Stay safe, stay optimistic, it will work out.

Even though CRA is granting interest relief on taxes owing for many taxpayers, the returns still need to be filed. Not just to avoid penalties but also to determine 2021 entitlements. April 30 will come on fast!!

Working from home during COVID?

New temporary flat rate method
The new temporary flat rate method simplifies your claim for home office expenses. You are eligible to use this new method if you worked more than 50% of the time from home for a period of at least four consecutive weeks in 2020 due to the COVID-19 pandemic. You can claim $2 for each day you worked from home during that period plus any additional days you worked at home in 2020 due to the COVID-19 pandemic. The maximum you can claim using the new temporary flat rate method is $400 (200 working days) per individual.

Each individual working from home who meets the eligibility criteria can use the temporary flat rate method to calculate their deduction for home office expenses. This means multiple people working from the same home can each make a claim.

This method can only be used for the 2020 tax year.

Simplified process for the temporary flat rate method
You do not have to: calculate the size of your work space, keep supporting documents or get Form T2200 completed and signed by your employer

Personal taxes ReduX!

So, the deadline has come and gone, right? Well, not exactly. There is still time to file...months really, before the dreaded penalties and interest kick in. If you are due a refund...well, file...seriously. Self employed folks are still required to file by June 15th, for the time being at least. Corporate entities, see CRA's website, too much for a Facebook note. It's better to know where you stand personally or as a business owner, then plan your way through.

Friendly reminder:

June 1, 2020 - filing deadline for personal taxes.

The plan in it's early stages. Stay safe and plan for recovery

Canada’s COVID-19 Economic Response Plan - Canada.ca Canada’s COVID-19 Economic Response Plan

E-File opens Monday, February 4 for personal 2019 T1 returns. Have a great weekend!

I'm starting to like dividends and paycheques together as opposed to exclusively drawing dividends. The bias still tends towards dividends, but a paycheque opens up entitlements and other avenues of our current not so simple tax landscape. Also, I still spell cheques with a "qu" and not a "ck"!

Some tips on compensating employees and avoiding taxation!
Three easy ways to show appreciation to employees without creating a taxable benefit.

1. GIFTS UNDER $500 ANNUALLY
2. GIFTS UNDER $500 EVERY FIVE YEARS (SERVICE AWARDS)
3. SMALL GIFTS (WHAT CRA CONSIDERS TRIVIAL)

CASH AND NEAR CASH GIFTS DO NOT QUALIFY FOR THESE PROGRAMS. NEAR CASH IS ANY GIFT THAT BE READILY CONVERTED TO CASH OF USED TO PURCHASE ANY ITEM UPON RECEIPT; I.E. GIFT CARD

Etter Macleod & Associates updated their phone number.

Etter Macleod & Associates updated their address.