Spring Economic Statement: April 28, 2026

April 15, 2026: Ottawa, Ontario - Yesterday, the Honourable François-Philippe Champagne, Minister of Finance and National Revenue, announced that he will table the Spring Economic Update 2026 on Tuesday, April 28, 2026. In the Spring Economic Update 2026, the government will provide an update on its plan to build the strongest economy in the G7, and outline additional actions taken to drive prosperity, play to Canada’s strengths, and support Canadians where and when they need it most.

September is Back to School Month and aside from reviewing tax breaks for tuition, education and textbook amounts, students and their supporting individuals will want to think about withdrawals from an RRSP under the Lifelong Learning Plan as an alternative to going into debt to fund school costs. Here's what you need to know: Using the RRSP for School Funding: The Lifelong Learning Plan allows a taxpayer to withdraw (under S. 146.02) up to $20,000 of funds saved within their Registered Retirement Savings Plan (RRSP) for the purpose of furthering their education or the education of their spouse or common-law partner, on a completely tax-free basis. The withdrawal limit is $10,000 per year. No tax will be withheld on such withdrawals. The withdrawals may be a single amount or the taxpayer may make a series of withdrawals as long as the total does not exceed $20,000. Funds are withdrawn from the RRSP using Form RC96 Lifelong Learning Plan (LLP) Request to withdraw funds from an RRSP. The funds must be repaid back into the RRSP, over a period not exceeding 10 years, beginning in the fifth calendar year after the withdrawal or the year after the student ceases to be a full-time student for at least three months in the year, whichever comes first. Amounts which are due and not repaid are included in the taxpayer's income under S. 56(1)(h.2) in the year they are due. Taxpayers are free to participate in the plan again once they have repaid the amount borrowed. Using the Tuition Fee Amount: Here is a review of the basic definitions for non-refundable credits and what qualifies for the tuition credit and education amounts: DEFINITIONS IN BRIEF: Non-refundable tax credits available to post-secondary students and their supporting individuals include the following: Amounts for Tuition: Post-secondary students may claim the tuition amount under S.118.5 of the Income Tax Act. Amounts for Education Costs: A monthly education amount available under S.118.6 Amounts for Textbooks: A monthly credit for such costs is specified under S. 118.6(2.1). Transfers to Supporting Individuals: Students must claim the above amounts first on their return. If the student is not taxable, the claim for the tuition, textbook and education amounts may be transferred from a student to the supporting individual under S.118.81 or may be carried forward to future years for use by the student. NOTE: KNOWLEDGE BUREAU SELF STUDY COURSES QUALIFY! Next Time: Which tuition fees are eligible? Educational Resources:   Taking the Knowledge Bureau's certificate course Introduction to Personal Tax Preparation Services is a great way get your start earning a second income as a tax services specialist. See www.knowledgebureau.com for more information on our courses and how to enroll.

The federal government has just released two new forms to help advisors and their clients calculate excess RRSP contributions and their 1% per month penalties. To view the new forms, link to them here - T1-OVP and T1-OVP-S. RRSP contributions in excess of the $2,000 (or those in excess of contribution room for taxpayers under 19) are subject to a penalty of 1% per month on the excess. A complicated form called a T1-OVP must be completed in that case and the penalty must be paid by March 31 of the year following the cumulative excesses. Penalties will accrue until the excess contributions are withdrawn from the RRSP. It's important to remove those contributions, because you'll want to avoid double taxation upon later withdrawal (that is, you want to make sure you got a tax deduction for any contributions that will later be taxable). Paying a professional to reverse the excess can be expensive too, because the forms are a time-consuming, complicated headache. Here's what you need to know when you contribute too much to your RRSP: 1.  When the Contribution occurs<?xml:namespace prefix = o ns = "urn:schemas-microsoft-com🏢office" /> 2.  The amount over the allowed overcontribution limit of $2000 (Note if under 18 no overcontribution limit is allowed) 3.  The amount of excess contribution (amount over $2000) x # months x 1% per month = penalty 4.   When to calculate penalty (payment is due March 31) 5.  How far.back you need to go (taking into account new RRSP room every January) . . 6.  How to withdraw overcontributions 7.  How to withdraw excess contributions Bottom line: tax and financial advisors get your RRSP contributions rightóover- and excess-contributions are expensive. For all the information on this subject including access to all RRSP contribution, withdrawal and excess contribution forms, subscribe to The Knowledge Bureau's online tax reference for taxpayers, financial advisors and their clients: EverGreen Explanatory Notes.

Employers - with so many summer students leaving their jobs to head back to school, it's time to brush up on the rules related to "interruption of earnings" or what is more commonly referred to as a "termination of employment".   A record of employment (ROE) form is required by the government once an employee has a break in employment. The government uses the information on the ROE to determine whether a person qualifies for EI benefits, the benefit rate and the duration of his or her claim. An ROE must be issued by an employer even if the employee has no intention of filing a claim for EI benefits. An interruption in earnings could be due to the employee's quitting or the employer terminating the employment, but only arises if it involves or is expected to involve 7 consecutive calendar days without work or insurable earnings from the employer. An interruption of earnings also occurs where a salary falls below 60% of normal earnings due to illness, injury, quarantine, pregnancy, the need for a parent to care for either newly born or adopted children, or the need to provide care or support to a family member who is gravely ill with a significant risk of death. Special rules apply to casual workers. When a part-time or casual worker has not worked for 30 days, is no longer on the employer's active employment list or the employee or the government requests an ROE form, a form must be completed by the payroll department. FINAL PAY Other than vacation pay and severance, an employee may be owed other amounts. The employee may earn incentive based bonuses through the course of employment. If an employee terminates, a prorated bonus amount may need to be calculated. If an employee terminates and does not work out the notice period, then pay in lieu of notice is paid if it is the employer's decision to not have the employee work out this time. If the employee fails to complete the proper notice period, then the employer is not normally required to pay this amount to the employee. These rules vary by province and therefore it is important to refer to provincial labour standards for the correct notice period rules. An employee may owe amounts at the time of termination to the employer for a health plan, an RRSP plan or donation plan or any similar arrangement. These amounts must be deducted from the final pay. A termination checklist is useful in helping the payroll department to determine that all payments and all deductions are captured for the final pay. It can also be used to ensure that all internal policies relating to a termination have been complied with. When an employee is terminated a termination letter is usually prepared by the payroll or human resource department which outlines the reason for the termination, monies owing to the employee and continuation of any benefits or other coverage. The letter should also describe any non-competition agreement terms and any other actions required by both the employer and the employee. An employee may or may not work their notice of termination period ñ the period from the announcement that employment is terminated until the last day of work. As noted above, if an employee chooses not to work their notice period, the employer generally does not have to pay the employee for the notice period. On the other hand, if an employer chooses not to have the employee work out their notice period then the employer must pay the employee for this period. As mentioned earlier in the course, this payment is referred to as "pay in lieu of notice". Notice period rules vary by province and can be found in provincial labour standards. Educational Resources: Excerpted from Advanced Payroll for Professional Bookkeepers,  one of the courses that comprise the Bookkeeping Services Specialist program.

The CRA has announced that they have revoked the charitable registration of a Toronto based charity, The Mission Against Poverty Shelter.  The charity allegedly issued receipts for transactions that didn't qualify as gifts, and failed to maintain proper records to support its activities.    With tax freedom day finally behind us, many Canadians start working for themselves and their communities in the summer months. But be aware of where you are donating your time and money, as numerous charities have had their charitable status revoked in the last year due to non-compliance with the rules for maintenance of their registration.    Last year the CRA revoked the status of 38 charitable organizations, after auditing 845 charities, for serious infractions and this trend is continuing in 2009.  Many other charities lost their status after failing to file their annual returns.  Once an organization has their charitable status revoked it can no longer issue official tax receipts for donations and it is no longer a qualified donee under the Income Tax Act.   Some reasons that CRA will revoke a charity's status include the following: lack of control over spending of charitable funds poorly maintained books and records issuance of tax receipts in excess of gifts received failure to meet charitable activity spending requirements   Following is an excerpt from the Tax Efficient Retirement Income Planning Course, providing some insight on the giving qualities of Canadians as a whole: Facts on Canadian Philanthropy 5.7 million Canadians contributed $6.9 billion to charitable organizations in 2006. Statistics Canada reported that the total market value of stock held by Canadians at the end of 2006 was $1.4 trillion, an increase of $100 billion over the previous year Approximately one-half of that market value represents unrealized capital gains, suggesting that the opportunity for many shareholders to donate stock and save tax is very significant. TD Economics estimates that the market value of stock held by Canadians in 10 years' time could exceed $3 trillion, with as much as two-thirds of that in unrealized gains. Demographic Trends Potential for philanthropy is immense: In Canada, between $15 and $20 trillion is expected to shift from parents to their children between now and the middle of the century. Baby boom generation is having significant impact on the world of charitable giving: not content to simply write a cheque and move on, donors expect transparency and accountability - they want to be involved. Many charities are revisiting the way they operate in order to attract these younger philanthropists. General Rules At some point during the year many Canadians give to charities. Those gifts, usually of money, will be claimed on Schedule 9 of the tax return. Unclaimed donations from the previous five years may also be claimed in the current year. Donations made through payroll deductions should also be claimed. These will show on the T4 slip. Generally you can claim all or part of your total donations, up to a limit of 75 percent of your net income reported on line 236. For the year a person dies and the year immediately prior, this limit is 100 percent of the person's net income. It is generally most beneficial to claim donations made by both spouses together on one tax return. This is because the first $200 of donations is eligible for only a 15 percent tax credit, while any additional donations attract a tax credit of 29 percent. Combining donations will ensure the couple is subjected to the 15 percent limit on the first $200 only once, not twice. Donations made during the year do not have to be claimed on that year's return and may be carried forward to a subsequent year, up to five years. This may be of benefit, if, for example, you already have sufficient non-refundable tax credits to completely eliminate taxes payable. So remember, only donations made to Canadian registered charities and other qualified donees may be claimed. A registered charity will show its charity registration number on the receipt. The slip must also indicate the Web address of the CRA. Click here for more information on the Tax Efficient Retirement Income Planning Course and to register in the Retirement Income Specialist program.

In an effort to retain graduates, provinces have recently begun to reimburse tuition paid to post-secondary graduates if they remain in the province. Saskatchewan will reimburse 100% of the tuition paid if the graduate remains in the province long enough, while Manitoba will reimburse up to 60%, and New Brunswick will reimburse 50%. This reimbursement is in addition to the credits allowed to students in the year that the tuition is paid (or in a later year if carried forward). For students who continue to live and work in the same province after graduation, the result is a reimbursement of more than the amount of tuition paid (in Manitoba and Saskatchewan). Assuming a four-year program with $5,000 per year tuition ($20,000 total tuition), 8 months of full-time attendance, and a student paying taxes in the lowest bracket while in school, the following table shows the recovery of tuition fees each year over time in each province: Prov Years 1 to 4 Years 5 / 6 Year 7 Year 8 Years 9 -10 Years 11 - 12 Total Recovered % recovered AB $2,310 $9,240 46% BC $1,642 $6,568 33% SK $2,210 $2,000 $2,000 $2,000 $4,000 $4,000 $28,840 144% MB $2,202 $2,000 $2,000 $2,000 $2,000 $20,808 104% ON $1,837 $7,348 37% NB $2,138 $4,000 $2,000 $18,552 93% NS $2,112 $8,448 42% PE $1,785 $7,140 36% NL $1,849 $7,396 37% YT $1,922 $7,688 38% NT $1,792 $7,168 36% NU $1,657 $6,628 33%   Many frenzied parents find the "back to school" rush a financial burden. Besides clothing, school supplies, transit passes and books, there is tuition for university students, a rising cost across the country. Now is the time to consider the monthly credits earned by post-secondary students, which will turn into cash at tax time for students or their supporting parents, grandparents or spouses. No receipts are necessary to benefit from this lucrative credit, but Form T2202A must be received from the university or designated educational institute. Advisors and clients should check the points below for a better understanding of qualifying criteria. EDUCATION AMOUNT Full Time Students. The credit for full-time students is $400 per month. A full-time education amount may be claimed for each whole or part month in the year that the student was enrolled in a qualifying educational program at a designated educational institution and the student: was enrolled full time, was enrolled part time and qualified for the disability amount, or was enrolled part time because of a mental or physical impairment. Qualifying educational programs (FULL-TIME): a program that lasts at least 3 consecutive weeks and requires a minimum of 10 hours of instruction or work in the program each week (not including study time). Instruction or work includes lectures, practical training, and laboratory work. It also includes research time spent on a post-graduate thesis. After 2003, a program taken by the student in connection with the student's employment duties, even if that student receives income from that employment, will qualify provided only that the employer does not reimburse the tuition cost. Prior to 2004, the opposite was the case: such programs did not qualify, whether the employer reimbursed the student or not. Non-qualifying educational programs: Students who receive, from a person with whom he or she deals at arm's length, a grant, reimbursement, benefit, or allowance for that program do not qualify. However, receipt of a scholarship, fellowship, bursary, or prize received, or any benefit received under the Canada Student Loans Act, Canada Student Financial Assistance Act, or the Act respecting financial assistance for education expenses of the Province of Quebec does not disqualify the education program. Part Time Students. The credit is $120 per month. These may be claimed for each whole or part month in the year that the student was enrolled in a specified educational program at a designated educational institution. A specified educational program is a program that lasts at least 3 consecutive weeks and requires at least 12 hours of instruction each month. NOTE: KNOWLEDGE BUREAU SELF STUDY COURSES QUALIFY!  See our website at www.knowledgebureau.com for more information on our programs. Only one education amount may be claimed for each month ó the full-time amount or the part-time amount.   Join us next time in Breaking Tax and Investment News for more tax savings tips related to education and tuition credits.   Educational resources: For more information on tax planning provisions and compliance requirements, subscribe to The Knowledge Bureau's online tax reference for taxpayers, financial advisors and their clients: EverGreen Explanatory Notes.    

By now, most of us have heard of the Tax-Free Savings Account (TFSA) which was introduced in the February 26, 2008 Federal Budget. It is a registered account in which investment earnings, including capital gains, accumulate tax free. Beginning in January 2009, taxpayers over the age of 17 may contribute up to $5,000 each year to such an account. If a taxpayer's contribution room is not used in one year it may be carried forward to the next year allowing for a larger contribution in that year. In some ways the TSFA is similar to an RRSP and in a lot of ways it is not. Contribution room in TFSA does not depend on "earned income" but is a flat $5,000 per year. Unlike the RRSP, contributions to a TSFA do not result in an income tax deduction and withdrawals from a TFSA are not reported as income nor included in income for any income-tested benefits, such as the Canada Child Tax Benefit or Goods and Services Tax Credit. The CRA will establish contribution room for all taxpayers on the basis of income tax returns filed. Taxpayers who do not file for a number of years may establish their contribution room by filing those returns. Upon death of the TFSA holder, the funds within the account may be rolled over into their spouse's TFSA (before the end of the calendar year following the year of death) or they may be withdrawn tax-free. If the TFSA is not rolled over, any amounts earned within a TSFA after the death of the taxpayer are taxable to the estate or the recipient if paid out before the end of the first calendar year following the year of death. If the contents of a TFSA are donated to a registered charity in the taxpayer's will, the donation is deemed to have been made immediately before the taxpayer's death. One question that many people ask is who can receive the proceeds when the TFSA account holder dies? Although TFSAs are federally regulated accounts, provincial legislation determines if a beneficiary can be named in a TFSA contract. Under the Income Tax Act, the tax exempt status of the account only applies to the spouse or common law partner, so if the named beneficiary of the account upon death is someone other than a spouse or partner, the account is no longer considered to be a TFSA. Most provinces and territories have now enacted legislation allowing TFSA beneficiaries to be named that aren't spouses or partners, and therefore, upon the death of a TFSA holder, the beneficiary can have the TFSA assets passed on to them without going through the estate and subject to expensive probate fees. We have provided a summary below of the successor holder and beneficiary recognition by province:                                                         Province Designation of Successor Holder and Beneficiary Allowed? Effective Date Alberta Yes January 1, 2009 British Columbia Yes November 27, 2008 Manitoba Yes June 11, 2009 New Brunswick   Yes January 1, 2009 Newfoundland Yes May 28, 2009 Northwest Territories Yes February 2009 Nova Scotia Yes November 25, 2008 Nunavut Yes February 2009 Ontario Yes June 16, 2009 Prince Edward Island Yes December 3, 2008 Quebec No N/A Saskatchewan Yes May 14, 2009 Yukon   Yes May 14, 2009   Educational Resources: For more information on tax planning provisions and compliance requirements subscribe to The Knowledge Bureau's online tax reference for taxpayers, financial advisors and their clients: EverGreen Explanatory Notes.