Wildfires: Apply for Taxpayer Relief Provisions

It may not be the first concern, but Canadians affected by wildfires may worry at some point about the tax consequences of lost records or missed filing deadlines – the next one on June 16 for those filing T1 returns with proprietorship income. Fortunately, the CRA offers Taxpayer Relief Provisions when there are circumstances beyond a taxpayer’s control, including natural disasters, serious illness or death in the family, or errors made by the CRA, which may trigger penalties and interest due to late or incomplete tax filings. Here’s what you need to know.

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:

Ontario residents reconsidering international travel plans this year due to the pandemic now have even more incentive to explore destinations closer to home – specifically within the province – thanks to the newly introduced refundable Staycation Tax Credit. The tax credit reimburses 20% of eligible accommodation costs, up to a maximum dollar amount.  It’s a tax incentive other provinces may want to pick up on to spur on home-based tourism. Here are the details:

One of the many changes for this tax season 2022, is that 2021 tax refunds will be lower for thousands of taxpayers that qualified for the “Climate Action Incentive” (CAI). Prior to 2021, the CAI was a refundable tax credit similar to the Canada Workers Benefit or the Canada Training Credit. In all these cases, these credits constituted a tax-free cash benefit that either increased a tax refund or reduced the net tax liability for taxpayers.

Don’t miss this opportunity to take Canada’s most up-to-date and comprehensive Advanced T1 Tax Update Course for Professional Tax Accounting firms and their new and returning staff who will file 2021 T1 Returns. This is Canada’s #1 tax training program for busy practice owners who need to recruit and train staff in time for this tax season.  No travel, no time zone issues, available 24/7 online with outstanding expert instructor-led presentations and support. Leave the training to Knowledge Bureau to make sure you are ready for the busy season, at a special time-limited fee, too.

It’s been almost two years of personal physical, mental and emotional life triggers, coupled with many economic and financial changes.  How can just one financial professional ensure that their client's holistic wealth management plan is focused on tax efficient wealth sustainability with so many triggers at once? Join the Society of Real Wealth Managers™ and seven special guests for the next Meeting of the Minds: 360 Degree Trigger Tour on February 2 at 10 AM CST.   Register now for this complimentary educational event!

On January 14, 2022 the CRA confirmed that trust tax filings for trusts with year-end that falls on or after December 31, 2021 will not be required under new disclosure rules because legislation to enable them and the severe penalties for failure to file a new schedule has not been enacted into law.  For the time being, tax pros will follow the existing rules until supporting legislation receives Royal Assent. There are some interesting details within the proposed rules, which will likely affect next year’s returns.