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:

New Course Alert: The Digital Practitioner Course (Your Guide to Remote Work) When the pandemic hit, there was a natural surge in employees working from home. In Canada, the percentage of *core-age employees working from home was about 43% in May 2020. As the pandemic subsided, in December 2021, 26% of core-age employees in Canada worked from home, compared with 13% in the United States. Majority of people who are working remotely—want to keep it that way.

Disabled people represent the world’s largest minority.  There are 1.1 Billion people in this category around the world and the reality is that this is a minority group everyone has the potential to join – any time.  Planning for incapacity is therefore a prime-of-life topic that advisors must raise proactively in order to maximize the opportunities for preparedness and importantly, the assistance that may be available through the tax system.

The pandemic has underscored the important role of caregiving in Canadian society.  But even before the pandemic 25% of Canadians aged 15 and older – close to 8 Million people- were involved in caregiving to a family member or friends with a long-term disability or age-related decline.  These caregivers have key unmet needs

In a climate of rising interest rates, Home Equity Lines of Credit (HELCO) and other joint borrowing opportunities can present a new risk for two generations in the family.  Joint borrowers need to be aware of the dangers ahead and the tax consequences; all reasons why that’s an important part of a year-end tax planning conversation.

The April 2022 federal budget, introduced a Labour Mobility Deduction for skilled tradespeople and apprentices who need to temporarily relocate for work. It’s important to advise eligible taxpayers about this, so they keep receipts to back up the claims retroactively to January 1, 2022.   

In Canada, as in many advanced economies, the age group that grew the fastest in recent years was those aged 65 and over. That’s not pandemic-related, it’s simply the aging of the baby boomers. Those over 65 tend to have the lowest labour force participation rate, and that has been pulling down the growth of Canada’s labour force in recent years, according to recent remarks by Tiff Macklem, Governor of the Bank of Canada. In addition, many small businesses in Canada are owned by Baby Boomers.  There’s a potential problem if Baby Boomers own a business and plan to use the money they’ve invested to pay for their retirement years.