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Brampton Accountant: 2015 Income Tax Checklist

Brampton Accountant: 2015 Income Tax Checklist

Brampton Accountant: 2015 Income Tax Checklist. Cheema CPA Professional Corporation is a Chartered Professional Accountant firm located in Brampton, Ontario. We provide professional tax and accounting services. Each year we put together a checklist to help our clients assemble all the information required for personal taxes. This checklist will help you get more organized and help us minimize your taxes. To download: Tax Checklist.

General Items

  • A copy of last year’s return
  • 2009 Notice of Assessment
  • Other years reassessments
  • Details of changes to your personal status such as dates of marriage, separation, divorce or widowed, births and deaths
  • Note consenting to provide your income tax information to Elections Canada
  • Installment payments
  • Details of foreign property holdings (if any*) including cost of property held

Income

  • Universal child care benefit (RC62)
  • Employment income (T4)
  • Pension income (T4A, T4A(P), T4RIF, T4RSP)
  • US social security
  • Old age security (T4OAS)
  • Investment income (T5)
  • Income from trusts such as mutual fund investments (T3)
  • Income from employment insurance (T4E)
  • Income from partnerships (T5013)
  • Workers compensation/social assistance payments (T5007)
  • Details of the sale of securities such as stocks and bonds (eg. trading summary from your broker)
  • Income from foreign investments
  • Spousal support payments received

Deductions General

  • RRSP contributions
  • Medical, dental, prescription drugs, nursing home expenses
  • Payments to a private health insurance plan
  • Charitable donations
  • Tuition fees/education amount (T2202A) for yourself or transferred from a dependent such as a child or grandchild
  • Interest paid on student loans c Professional dues, union dues c Public transit passes
  • Childrens participation in programs related to physical activity
  • Interest on loans assumed to purchase investments
  • Safety deposit box fees
  • Professional consultant fees
  • Legal fees paid to establish child or spousal support or to enforce a pre-existing agreement
  • Legal fees paid to recover wages from your employer
  • Details of people you support and their medical status
  • Child care receipts (for camp, list dates attended)
  • Moving expenses if you moved 40km or closer to work or school
  • Property taxes or residential rent paid and to whom
  • Political contributions receipts
  • Disability tax credit claim form completed by authorized health practitioner (T2201)
  • Spousal support payments paid
  • Adoption expenses

Deductions Employees

  • Declaration of conditions of employment form (T2200)
  • Details of expenses not reimbursed by your employer including travel expenses (eg. parking, taxis, bus fare), supplies and assistant salaries
  • Office rent if required as a condition of employment
  • Home office expenses if it is your principal workplace or used exclusively, on
  • a regular or continuous basis for activities such as business-related meetings; include details of rent paid, repairs and maintenance costs, utilities and if you are
  • a commissioned salesperson also property taxes and home insurance. Also indicate the total area of your home and the area used for your work-space
  • If you are a commissioned sales-person, details supporting advertising expenses, promotion, meals and entertainment
  • Motor vehicle expenses

Deductions Motor Vehicles

  • Total kilometers driven and kilometers driven just for work
  • Details of total expenses incurred for gas, maintenance and repairs, insurance, license and registration, loan interest and lease payments
  • New vehicle, purchase invoice/agreement

Unincorporated Businesses

  • Total sales revenue for the year
  • Total expenses listed by category for the year
  • Capital assets acquired (eg. computers and peripherals, furniture and equipment)
  • Home office expenses include details of rent paid or if you own your home, details of repairs and maintenance, utilities, property taxes, insurance, mortgage interest
  • Motor vehicle expenses

Unincorporated Businesses

  • Total sales revenue for the year
  • Total expenses listed by category for the year
  • Capital assets acquired (eg. computers and peripherals, furniture and equipment)
  • Home office expenses include details of rent paid or if you own your home, details of repairs and maintenance, utilities, property taxes, insurance, mortgage interest
  • Motor vehicle expenses

Download (PDF, 30KB)

2015 INCOME TAX

2015 INCOME TAX

 

Personal Tax Changes 2016 Tax Season

Personal Tax Changes 2016 Tax Season

Personal Tax Changes for 2016 Tax Season

Personal Tax Changes for 2016 Tax Season

Changes and Updates for 2016 Tax season

We will discuss the personal tax changes 2016 tax season in this article. Following key changes to existing services, credits, and amounts impact individual taxpayers in the 2016 tax-filing season:

  • Updated notice of assessment – The Canada Revenue Agency (CRA) has updated the format of the notice of assessment to be simpler. Taxpayers can now find the most important information about the assessment on the first page.
  • Universal child care benefit (UCCB) – For the 2015 tax year, the UCCB was expanded to children aged 6 through 17. Also, payments that parents receive for children under the age of 6 increased to $160 per month for each child. To learn more about the UCCB read our full blog post here. This Personal Tax Changes 2016 Tax Season was implemented before 2016.
  • Disability Tax Credit – This year, Canadians claiming the Disability Tax Credit (DTC) will be able to file their T1 return online regardless of whether or not their Form T2201, Disability Tax Credit Certificate has been submitted to the CRA for that tax year.
  • Children’s fitness amount – As of January 1, 2015, this is now a refundable tax credit available to families with children enrolled in a prescribed program of physical activity. For tax years prior to 2015, this credit was non-refundable. The Children’s Fitness Tax Credit allows you to claim eligible fees paid in the year up to a maximum of $500 per child (an additional amount of $500 is available if the child is eligible for the Disability Tax Credit and a minimum of $100 has been paid for eligible fees in the year). The child must have been under 16 years of age (or under 18 years of age if eligible for the disability tax credit) at the beginning of the year in which an eligible fitness expense was paid.
  • Child Care Expense Deduction limits – As of the 2015 tax year, the Child Care Expense Deduction dollar limits have increased by $1,000. The maximum amounts that can be claimed have increased to $8,000 for children under age seven, to $5,000 for children aged seven through 16, and to $11,000 for children who are eligible for the Disability Tax Credit.

For more information on the above key changes that may impact you, contact Cheema CPA Professional Corporation. Cheema CPA can help you understand personal tax changes 2016 tax season.  Visit the CRA website for more personal tax changes and updates 2016 tax season.

CRA sued for $32-million – result of multiple CRA audits

Canada Revenue Agency

Canada Revenue Agency sued for $32-million

CRA sued for $32-million – result of multiple CRA audits

Cardel Construction a real estate developer has initiated a lawsuit against the Canada Revenue Agency and is seeking $32 million in damages. CRA audited the books of Cardel and assessed $219-million in taxes, which equates to 150% of the corporate and personal income. The shareholders claim this to be a intimidation threat and have launched this lawsuit in return. Read more about the lawsuit directly on BNN.

Brampton Tax Accountants

Tax Accountant

Tax Accountant

Cheema & Assocaite – Your Local Brampton Tax Accountants 

Cheema & Associate CPA Professional Corporation is an accounting firm located in Brampton, Ontario at the main intersection of Kennedy Rd S and Clarence St. Our office address is 143 Clarence st. Suite 5, Brampton ON L6W 1T2.

We provide income tax services to all types of clients from Brampton. We have been serving the Brampton market for over three years. Tax has evolved over the years with strict regulations imposed by the Canada Revenue Agency. We can professionally prepare your tax returns while maximizing your refund by designing and catering unique tax planning strategies. Our professionals have experience in handling wide rage of unique tax returns. Contact us for your 2014 personal income tax returns.

Our Brampton tax accountants are dedicated in assisting you in all your income tax needs.

Personal Income Tax
Personal tax has evolved over the years with strict regulations imposed by the Canada Revenue Agency. Your local Brampton tax accountants can professionally prepare your tax return while maximizing your refund by designing and catering unique tax planning strategies. Our professionals have experience in handling wide rage of unique tax returns.

Corporate Tax
Our uniquely designed tax programs can assist you with complying with the complicated provisions of the Income Tax Act (ITA) while minimizing tax liabilities. We can structure your business to maximize profitability and minimize tax risks.Contact us for your 2014 corporate tax returns.

Audit & Appeal
Our team is dedicated to assist you in all your CRA appeals. We make sure that your company’s tax audit is handled smoothly and efficiently. We can assist you with the tax audit process – starting from the information gathering stage to negotiation with the tax authorities. We can also help in negotiating payments and even apply for interest or penalty relief.

What is a professional corporation?

Professional Corporation

Professional Corporation

What is a professional corporation? 

A professional corporation operates much like a business corporation with few exceptions. A professional corporation has to abide by the regulations set by the Business Corporations Act (Ontario) and by the respective governing body. A professional corporation  can-only carry on activities of its profession. A professional corporation must meet the requirements of its governing body and receive a Certificate of Authorization or equivalent.

Many professionals are allowed to operate their business as a professional corporation.  Examples of professions that can operate under a professional corporation:

 Accountants  Lawyers  Medical professionals
 Engineers  Architects  Social Workers
 Veterinarians  Pharmacists  Chiropractors

Historically professionals have operated through a sole proprietorship or partnership which limits tax planning  and results in higher taxes (see “How to setup a business in Ontario” for more in depth discussion). Professionals have lobbied the provincial governments which have allowed them to incorporate their practices.

Does a professional corporation have limited liability? 

In “How to setup a business in Ontario” we discussed that a corporation is a separate legal entity and it has limited liability. A professional corporation is slightly different and does NOT have full limited liability (exception for architects and engineers). A professional corporation only offers limited liability in certain areas. When it comes to business debts, the shareholder is only liable up to his or her investment in the business.  However, in other circumstances such as malpractice, the corporate veil is lifted resulting in unlimited liability.

 

Read more

Business Transfers To Family Members


family-325218_1920Inadequate Succession Planning

 

According to reports published by CIBC it is expected that 30% or close to 310,000 Canadian business owners will sell or transfer ownership of their businesses in the next five years. The growing number of transfers has a significant impact on the Canadian economy and predecessor owners.

The lack of effective tax planning and knowledge  has resulted in predecessor owners paying significant income tax. This directly affects retirement savings and future well-being.

Transferring Among Family members

Business owners might have family succession allowing them to transfer their family business to the next generation. This allows business to be kept in the family and continue to operate much like they did in the years before. However, section 84.1 of the Income Tax Act (ITA) creates a significant economic loss for the business owner if they decide to keep the business within the family.

The transfer of a business to a family member is administered through section 84 .1 of the ITA, which is in place to prevent tax evasion. In most cases this section of the ITA deprives the predecessor owner of the capital gains exemption, which can save thousands in taxes. This would make selling the business to a third party much more attractive because you can realize the capital gains exemption. Resulting in lower income tax for the business owner.

Section 84.1 has overly complicated the succession planning process. It hinders the business owners if they decide to keep the business in the family.

Recommendation

Like many other, The Canadian Chamber of Commerce has proposed that the federal government modify the ITA section 84.1 to “to facilitate  business transfers to family members and make this type of transfer at least as advantageous as transfers involving  unrelated third parties through the following measures”.

Read more

Canadian Tax Deadlines 2013-2014

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Important dates for Individuals
Tax return filing due dates
Employees file –> 2014 personal tax return is due April 30, 2015
Self-employed –> If you or your spouse carried on a business the 2013 personal tax return is due June 15, 2015. (If you have tax owing the payment still has to be made by April 30th)
Deceased persons –> The legal representative of the estate of an individual who dies in 2012, will have to file a tax return. The due date depends on the date of death and if the individual carried on a business.
Balance owing due dates
Your balance owing is due no later than April 30, 2013. When a due date falls on a Saturday, a Sunday, or a holiday recognized by the CRA, we consider your payment to be made on time if we receive it or it is postmarked on the next business day.
Installment payments due dates
Your installment payments for 2013 are due March 15, June 15, September 15, and December 15, 2013.
When a due date falls on a Saturday, a Sunday, or a holiday recognized by the CRA, we consider
your payment to be paid on time if we receive it or if it is postmarked on the next business day.
Your payment will be considered paid on one of the following dates:
  • Payments you make in person at your financial institution are considered paid on the date stamped on your INNS3 receipt.
  • Payments you send by mail are considered paid on the date you mail them.
  • Payments you make through your financial institution’s Internet or telephone banking services are considered paid when your financial institution credits us with your payment.
  • Post-dated cheques and payments you make by pre-authorized debit are considered paid on the negotiable date

Who is Required to File a Tax Return?

 Individuals must file a tax return if any of the following apply
 

 

Individuals must file a tax return if any of the following apply:
  • Taxpayer has taxes owning or wants to claim a refund
  • Taxpayer and their spouse or common-law partner elected to split pension income
  • Taxpayer received working income tax benefit (WITB) advance payments or wants to claim WITB
  • Taxpayer disposed of capital property or realized a taxable capital gain/taxable capital loss
  • Taxpayer has to repay old age security or employment insurance benefits
  • Taxpayer has not repaid all amounts withdrawn from your registered retirement savings plan (RRSP) under the Home Buyers’ Plan or the Lifelong Learning Plan
  • Taxpayer want to apply for the GST/HST credit
  • Taxpayer or spouse or common-law partner want to begin or continue receiving Canada child tax
  • benefit payments, including related provincial or territorial benefit payments. Read more