Finance Canada: No More Spring Budgets

Finance Canada announced on October 7 that Canada’s federal budgets will be brought down in the fall starting with the November 4, 2025 event; a significant departure from the spring schedule (February, March or April) that has been the cycle for several decades. This is going to affect many other events as we know them, and in the annual government spending approval cycle. There will also be a new budget process for capital vs. operational expenses. Here’s what you need to know:

It is no secret that CRA service levels have been under stress during the Pandemic. Many tax practitioners can confirm that a phone call that would normally have to wait for three to five minutes to be answered. At the peak of tax season could take one hour or more, not even including the dozens of dropped calls. Lately, response times have slowly decreased; however, it is still at unacceptable levels. As CRA shifts most of its services online through My Account, My Business Accounts, and Represent a Client one could think that there is less demand for phone calls. These services have also been compromised.

The Principal Residence Exemption: The Nuances is part of a three-part series explaining the principal residence exemption under Canadian taxation law. It begins with the tax consequences on the change in use of a principal residence. 

In the last election, the Liberal government promised that, after renovations to a building rent increases fall outside of a normal change in rent or are excessive in their view, they will implement a surtax on landlords.  It is interesting to think about the repercussions of such a proposed policy and to reflect on whether this the economic outcome that is truly desired, when our collective challenge is to invest in improving buildings for reasons of climate change and health care concerns?  Here are the details.

This doesn’t happen very often, but the result of our January Poll question which asked: “Do you think personal/corporate tax reforms can spur economic growth in Canada in 2022 and beyond?” were split right down the middle with 50% saying “yes” and 50% saying “no”. Why the mixed results from Canadian tax and financial professionals? Here’s what you had to say:

Statistics Canada has reported Canada’s largest drop in life expectancy since 1921 – a seven-month decrease.  It is an eye-opening study that brings to mind the importance of new conversations about medical,  disability and estate planning during the busy tax season, especially for younger people. 

The annual inflation rate rose to 4.8% in December 2021, yet many Canadians who have never experienced inflation in their lifetime, may wonder, so what? Over time, as one soon notices, inflation can significantly reduce the real value of Canadian savings and purchasing power.  When the computation of taxes or benefits are not fully indexed to inflation, there is also a real, but hidden, inflation tax.  Here’s how to plan for it: