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:

I held 200 shares of Kraft Foods in my non-registered investment account. Kraft split into Kraft Foods and Mondelez International. I now have 66 shares of Kraft and 200 of Mondelez. I noticed that my T5 slip is indicated that I received a foreign dividend of over $3,000. Is this a taxable dividend? I didn't receive any cash and the value of the two shares together were more or less the same. Please advise as this is a nasty shock. 

For owners of small businesses who pay themselves with dividends, the changes to the gross-up and dividend tax credit rates for 2013 will mean that the tax-free zone will decrease from its current level of about $42,500 for single taxpayers in 2013 to about $35,000 in 2014. 

Home office expenses are common for the self-employed; some employees may claim them too, when their employer signs Form T2200 to confirm this requirement. These claims are often audited so be sure to know the rules.

Family business owners typically have most of their net worth tied up in their business. Finding solutions to properly structure the business to allow it to flourish while allowing owners and their families to plan for their future can be difficult, especially if there is little time to explore strategies. This book will outline the options available to the family to ensure they know how to protect one of their most valuable assets.

Unincorporated small businesses have unique tax preparation and planning requirements. Provide superior service to a broad range of proprietorship clients including sole proprietors, partnerships, farmers, fishermen, and professionals. Learn how to complete income statements, capital cost allowance schedules, auto and home workspace schedules, and other unique calculations specific to the profile using the most recent tax laws and budget proposals.

Easily project investment income into the future. Use this calculator to input detailed figures of all the different types of investment income your client may have in the future, based on their current savings pattern. This planner will quickly determine the tax impact on investment income and help you reconfigure solutions when alternative saving strategies are required.