Retroactive Tax Law:  CRA Releases Self-Employment Guide, Finally

Walter Harder

This Monday March 21, 2022, CRA released the electronic version of T4002 - Self-employed Business, Professional, Commission, Farming, and Fishing Income for the 2021 tax filing year.  The paper version won’t be available until late April.  The Guide covers pandemic support measures for the self-employed, including CEWS, CERS, CRHP, and government loans.

It is difficult to comply with tax law that is uncertain and complex.  In this case, the government is releasing details of important provisions for which taxpayers bear the burden of proof close to the end of tax season, and before legislation has been finalized.  Applying tax law retroactively doesn’t seem fair.    

Consider that the Guide advises that the proposed changes for capital cost allowance for clean energy equipment, which will be effective for property that becomes available for use after April 18, 2021, are not included in the Guide discussions, because the legislation has not been finalized.  Once the legislation is finalized, the Guide will be revised to include the relevant details.

The Guide does provide details of the Return of Fuel Charge Proceeds to Farmers Tax Credit for farmers in Ontario, Manitoba, Saskatchewan and Alberta, although it fails to note that CRA will not assess the credit until the legislation receives Royal Assent.

Additional educational resources: 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.