Bill C-31: Royal Asset and New CRA Powers Could Come Soon

Changes are coming to the Income Tax Act and both you and your clients will all be affected with new tax risks including longer tax audits. Bill C-31, which passed second reading in the House of Commons on June 3 and is now at committee stage, contains elements of previous Federal Budgets that will expand the CRA’s compliance and enforcement powers. Here’s what you need to know and pass along to your clients:

NEW RRSP MAXIMUMS FOR 2009 Plan now to make your RRSP maximum contribution in 2009ó18% of earned income to a maximum of $21,000 (this is possible when earned income in 2008 was $116,667). MEAL AND VEHICLE RATES FOR 2008 CRA has released the new rates for meal and vehicle expenses. For meal expenses, the simplified rate is unchanged from 2007, a flat rate of $17 a meal or $51 per day, per person is allowed without receipts. For the simplified method of claiming vehicle expenses, the number of kilometres driven during the year may be multiplied by the appropriate cents/km rate below for the province in which travel begins. Province or territory Cents/kilometre Alberta 53.0 British Columbia 54.0 Manitoba 50.5 New Brunswick 52.0 Newfoundland and Labrador 55.5 Northwest Territories 64.0 Nova Scotia 52.5 Nunavut 64.0 Ontario 55.5 Prince Edward Island 52.5 Quebec 58.0 Saskatchewan 49.5 Yukon 66.0