Tax Tips

No one likes taxes, but with little tax planning you can achieve your goals.

Need Help With Your Taxes, Let Us Help You

We have designed few frequently asked tax tips for your to minimize the taxes. However, we can customize tax planning for your particular needs, Call US. Thank you for choosing Chaudhry Nafees & Company, Chartered Professional Accountant to facilitate your tax filing and looking after your financial affairs.

Canadian Tax Tips

SPLITTING PENSION INCOME

Under the new proposed rules you can split your pension income when you and your spouse or common-law partner file your 2019 income tax returns. New tax rules allow eligible taxpayers to allocate up to half of their eligible pension income (income that qualifies for the pension income tax credit) to their lower-earning spouse or common-law partner. Election can be made by filling form T1032.

SHARES SELLING DEADLINE

In order for capital losses to be realized for the current year, deadline to sell Canadian stocks is Dec 24th and Dec 26th for US stocks. This is because CRA considers the settlement date rather than the trasnaction or trade date.

SALE OF PRINCIPAL RESIDENCE

Capital gain on the sale of principal residence is tax free. In the same fashion the mortgage interest on principal residence is not tax deductible. However, it can be deductible in few cases (consult your accountant).

HOME OFFICE EXPENSE

If you are self employed or in other certain cases (consult your accountant) you can claim your home office to offset your business income or employment income. You can claim heat, hydro, insurance, mortgage interest, property taxes and minor repairs based on your office area in proportion to total home area.

BUSINESS SALE

Canadian resident shareholders are eligible to claim a lifetime captial gains exemption on a sale of shares of a small business corporation that meet certain criteria. For 2019, lifetime capital gain exemption is about $866,912 on the disposition of qualified small business corporation shares.

CANADIAN FILM AND VIDEO PRODUCTION

The government provides a refundable Canadian Film and Video Production tax credit of 25% of labour costs when producing Canadian films. This program is not available to individuals but, if you have a qualified Canadian corporation, you may be eligible to invest and receive this credit.

AUTOMOBILE STANDBY CHARGE

As the owner/manager, you use a car that belongs to the corporation, you may be required to include a taxable benefit (standby charge) in your income when you complete T4.

PERSONAL SERVICE BUSINESS INCOME

Also known as incorporated employee. If the corporation falls under PSB, it is not eligible for the small business deduction limit and recently federal tax rate is also increased. There are also some severe restrictions on expenses it can claim compared with other corporations.

SALARY AND DIVIDEND MIX

We can help to determine the preferred mix of salary and dividend for you and your family members to minimize

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