Tax Pros: Canada’s Tax System Has Taken a Big Hit

Canada’s tax and financial pros weighed in enthusiastically on last month’s two-part Knowledge Bureau Report Opinion Poll in which we asked: "Do you believe Canada’s tax system based on self-assessment, has suffered under recent changes at CRA and by Finance Canada?" 71% said yes. Part 2 was this question: "If so, what is the one wish you have for tax reform?" The responses were very interesting:

There are a number of usual suspects in the missed claims department, especially for do-it-yourself clients who now wish to hand over their tax and financial advisory work to professionals.  This is a great opportunity for professionals to find new money for their clients with obscure tax provisions like the GST/HST Rebate. 

There are special tax filing rules for people who immigrate to Canada.  They are required to file a Canadian tax return to report their world income during the period in which they were resident in Canada.  They also have to account for the valuation of their assets.  Tax advisors can be of great help in discussing the filing requirements before year end.

In response to a scathing report from the Parliamentary Budget Officer back in 2017, CRA initially promised to improve its service standards by 2020. CRA has made small steps in the right direction with an upgraded phone system for the business inquiries line.  Do you find that call requests are being resolved more quickly and accurately?

According to Statistics Canada, based on the 2018 tax year, taxpayers who donate to charity are giving more, marking a second year of growth in giving by these generous Canadians.  What’s more, charitable donations rose the most in Saskatchewan – a whopping 17.1% over the year before.  It was therefore very appropriate to hear from a prominent financial advisor from this generous province at this week’s CE Summit, to explain some of the reasons why.

Things have also gotten a lot more complex since taxes were first introduced in 1917.  Back then the tax return was six pages long and contained 23 lines. By contrast, the 2019 federal T1 featured an expanded 8-page return, 11 schedules and hundreds of lines. This complexity and digitization been a boon for tax accounting and bookkeeping services, which have grown exponentially, too.  Entry into these high demand and highly rewarding professions makes good sense, an dnew statistics about the size of the market confirm this good news.

Professionals in the tax, bookkeeping and accounting industries can add big value to stimulate healthy new births in a new economy. Based on newly released statistics on November 10, professionals could be more proactive in improving survival rates…but how? One way is to formalize business planning, budgeting and forecasting service offerings.