Wednesday, December 18, 2013

Donate wisely this holiday season!

Did you know?

The Canada Revenue Agency (CRA) regulates more than 86,000 registered charities in Canada. To make sure your donation goes to a legitimate charity, the CRA advises you to follow a few tips.

Important tips

  • Confirm that the organization is a Canadian registered charity.
    Registered charities have to devote their resources to charitable activities and are monitored by the CRA. Only charities that are registered with the CRA can issue official donation receipts, which can be used by the donor to claim a charitable tax credit. To check if an organization is registered, go to the CRA Charities Listings at www.cra.gc.ca/charitylists or call the CRA at1-800-267-2384.
  • Get to know the charity.
    Start by visiting the charity's website to learn about its activities and how it's managed. You can also review its financial information and activities by looking at its information returns using the CRA’s Charity Quick View at www.cra.gc.ca/charitylists. One of the best ways to learn about a charity is to volunteer.
  • Beware of gifting tax shelter schemes that promise you returns greater than your donation.
    There are many risks associated with these donation schemes and, in many cases, less than 1% of the funds donated are used for charitable works. The CRA strongly advises that you not participate in gifting tax shelter schemes. As of the 2013 tax year, if the amounts you have donated to a gifting tax shelter are in dispute, you are now required by law to pay 50 per cent of the taxes you may owe.
  • Learn to recognize the signs of fraud.
    Signs of fraud could include inappropriate pressure to give immediately, individuals who demand cash only or ask that you write a cheque payable to them rather than the charity. In addition, fraudulent organizations sometimes use names that are similar to well-known and respected registered charities.
Learn more about donating wisely this holiday season. Visit www.cra.gc.ca/donors.

Canada Revenue Agency

This a a reproduction copy of an official work that is published by the Government of Canada and that the reproduction has not been produced in affiliation with, or with the endorsement of the Government of Canada.

Tuesday, December 17, 2013

Workers aged 60 and over—make sure you are clear on CPP contribution rules

Did you know?

Are you 60 to 70 years of age and did you return to work in 2013 after being away from the workforce? You may not know about changes to Canada Pension Plan (CPP) contributions that came into effect in January 2012. The changes affect employees and self-employed workers aged 60 to 70 (but not those working in Quebec).

Overview of the changes

  • All workers aged 60 to 65 have to make CPP contributions—even if they are receiving a CPP or Quebec Pension Plan (QPP) retirement pension.
  • Workers who are 65 to 70 years of age and who are receiving a CPP or QPP retirement pension have to contribute unless they have taken action to stop their CPP contributions. By continuing to contribute (which can be done up to and including the month they reach 70 years of age), they will receive more benefits by way of the new post-retirement benefit (PRB). For more information on the PRB and other changes to CPP benefits, go to www.servicecanada.gc.ca/cpp.
  • To stop contributingto the CPP, workers have to be at least 65 years of age and receiving a CPP or QPP retirement pension. They must do the following: Note
    If you choose not to contribute by giving a completed copy of Form CPT30 to your employer, you have to wait until the next calendar year before you can start contributing again.

Canada Revenue Agency

This a a reproduction copy of an official work that is published by the Government of Canada and that the reproduction has not been produced in affiliation with, or with the endorsement of the Government of Canada.

Monday, December 16, 2013

Take advantage of the new first-time donor’s super credit

Did you know?
The new first-time donor’s super credit gives you an extra 25% non-refundable federal tax credit when you claim your charitable donation tax credit. This means that you can get a 40% credit for up to $200 in cash donations and a 54% credit for the part of the cash donations that is over $200 but not more than $1,000. This is in addition to the provincial credit.

Important facts
  • An individual qualifies as a first-time donor if neither the individual nor the individual's spouse or common-law partner has claimed the charitable donation tax credit since 2007.
  • The credit will apply only to cash donations made after March 20, 2013 up to a maximum of $1,000 in donations.
  • As a temporary credit, you can only claim it once from the 2013 to 2017 taxation years.
  • Only donations made to registered charities and qualified donees are eligible. To check if an organization is registered, go to the Canada Revenue Agency Charity Listings: www.cra.gc.ca/charitylists.The Charity Listings also provides information about registered charities’ activities, revenues, and expenditures.
  • To find out what your estimated credit will be, use the charitable donation tax credit calculator on the CRA website.
For more information on the first-time donor’s super credit, go to www.cra.gc.ca/fdsc.


Canada Revenue Agency

This a a reproduction copy of an official work that is published by the Government of Canada and that the reproduction has not been produced in affiliation with, or with the endorsement of the Government of Canada.



Friday, December 13, 2013

Statement by the Canada Revenue Agency on the release of the summary findings of the investigation into the refund cheque issued to Nicolo Rizzuto

Ottawa, Ontario, December 13, 2013 -- Today, the Canada Revenue Agency (CRA) released the summary findings of an internal investigation into a cheque issued in 2007 by the CRA to Nicolo Rizzuto.

The CRA investigation found there is no evidence to support the allegation that the cheque was issued due to fraud, collusion or corruption by CRA employees. The conclusions of the investigation have been independently validated by Ernst & Young LLP, who found that  the review was conducted in an impartial manner and with due diligence.

The CRA has revised procedures to ensure that files are clearly flagged and reviewed thoroughly before refunds are issued. An action plan is in place which includes additional process improvements to be completed by March 31, 2014. The action plan will be reviewed in six months to ensure the new controls are effective.
Canada Revenue Agency

This a a reproduction copy of an official work that is published by the Government of Canada and that the reproduction has not been produced in affiliation with, or with the endorsement of the Government of Canada.

Interest rates for the first calendar quarter

Ottawa, Ontario, December 13, 2013... The Canada Revenue Agency (CRA) today announced the prescribed annual interest rates that will apply to any amounts owed to the CRA and to any amounts the CRA owes to individuals and corporations. These rates are calculated quarterly according to the laws that apply and will be in effect from January 1, 2014 to March 31, 2014. All interest rates have decreased by 1% since last quarter, except for the rate for pertinent loans or indebtedness.

Income tax
  • The interest rate charged on overdue taxes, Canada Pension Plan contributions, and employment insurance premiums will be 5%.
  • The interest rate to be paid on corporate taxpayer overpayments will be 1%.
  • The interest rate to be paid on non-corporate taxpayer overpayments will be 3%.
  • The interest rate used to calculate taxable benefits for employees and shareholders from interest‑free and low-interest loans will be 1%.
  • The interest rate for corporate taxpayers’ pertinent loans or indebtedness will be 4.94%.
Other taxes, duties, or charges
The interest rates on overdue and overpaid remittances will be as follows:
Tax, duty, or other chargesOverdue remittancesOverpaid remittances – Corporate taxpayersOverpaid remittances – Non- corporate taxpayers
Goods and services tax (GST) 5% 1% 3%
Harmonized sales tax (HST) 5% 1% 3%
Air travellers security charge 5% 1% 3%
Excise tax (non-GST/HST) 5% 1% 3%
Excise duty except brewer licensees (amounts due after June 30, 2003) 5% 1% 3%
Excise duty except brewer licensees (amounts due before July 1, 2003) 3% N/A N/A
Excise duty (brewer licensees) 3% N/A N/A
Softwood lumber products export charge 5% 1% 3%

For information on the prescribed interest rates for other calendar quarters, go to www.cra.gc.ca/interestrates.

Canada Revenue Agency

This a a reproduction copy of an official work that is published by the Government of Canada and that the reproduction has not been produced in affiliation with, or with the endorsement of the Government of Canada.

Thursday, December 12, 2013

What’s new for tax professionals and preparers?

Did you know?

There are changes for tax professionals and preparers this tax-filing season.

Represent a Client – Scanned documents

At this time, you can use the service only to submit documents in response to letters from the CRA’s processing review and corporate assessing review programs that invite you to use the online service.

The Submit Documents service allows you to electronically send documents (examples include medical receipts, moving expenses, other employment expenses, child care expenses, Class 7 Assets, BC Training Tax credit, review of investment tax credit, and new acquisitions) to the Canada Revenue Agency (CRA) for your individual or business clients. You can access it directly through Represent a Client and you can submit documents for multiple clients.

Income tax folios

The CRA recognizes the value of income tax interpretation bulletins for tax professionals and preparers, so it is introducing a new technical publication to update the information in the income tax interpretation bulletins and to improve web functionality. The new publications are called income tax folios. Moving forward, all the interpretation bulletins will be updated and replaced by income tax folios.

Canada Revenue Agency

This a a reproduction copy of an official work that is published by the Government of Canada and that the reproduction has not been produced in affiliation with, or with the endorsement of the Government of Canada.

Wednesday, December 11, 2013

Does your business have employees aged 60 to 70?

Did you know?
Changes to the way you deduct Canada Pension Plan (CPP) contributions for your employees aged 60 to 70 came into effect in January 2012.

Employees working in Quebec and other workers not subject to the CPP are not affected by these changes.

CPP deductions for employees aged 60 to 70
  • You have to deduct CPP contributions for all employees who are 60 to 65 years of age—even if the employee is receiving a CPP or Quebec Pension Plan (QPP) retirement pension and did not contribute in the past.
  • You must also deduct CPP contributions for all employees who are 65 to 70 years of age, unless they choose not to contribute to the CPP by giving you a signed and completed copy of Form CPT30, Election to Stop Contributing to the Canada Pension Plan, or Revocation of a Prior Election. They also have to send the original Form CPT30 to the Canada Revenue Agency (CRA).
  • Workers who were at least 65 years of age in 2012, receiving a CPP or QPP retirement pension, and who had chosen to stop contributing to the CPP can start contributing again if they want to, but they have to wait until the next calendar year. They will be able to do so by giving their employer another signed CPT30 and sending the original to the CRA.
  • After the month in which they turn 70 years of age, employees can no longer contribute to the CPP.
Consequences
If you, as the employer, do not deduct or remit CPP contributions to the CRA, you may have to pay your employee’s share and your share of the CPP contributions. If you do not remit the contributions to the CRA by the due date, you may also be charged penalties and interest. For more information, go to www.cra.gc.ca/payroll and select "Penalties, interest, and other consequences."

More information
For more information about how the changes affect employers, go to www.cra.gc.ca/cppchanges-employers.

For tools and information explaining the CPP changes for individuals aged 60 to 70, go to www.servicecanada.gc.ca/cppchanges.

Canada Revenue Agency

This a a reproduction copy of an official work that is published by the Government of Canada and that the reproduction has not been produced in affiliation with, or with the endorsement of the Government of Canada.

Tuesday, December 10, 2013

Harper Government encourages Canadians to take advantage of the first-time donor’s super credit this holiday season

Ottawa, Ontario, December 10, 2013 - The Honourable Kerry-Lynne D. Findlay, P.C., Q.C., M.P., Minister of National Revenue, today met with representatives from the United Way Ottawa to encourage Canadians to take advantage of the first-time donor's super credit and to make a difference in their communities during the holiday season by giving to a registered Canadian charity.

“Canadians are well known for supporting those in need and the holiday season offers the perfect opportunity to donate to a favourite charity or cause”, said Minister Findlay. “The first-time donor's super credit is designed to support families and communities, including Canada's charitable sector. We want to continue to foster and promote Canada's culture of giving and to encourage everyone to donate generously to charities that do so much good work in our communities.”

Individuals qualify as first-time donors if neither they nor their spouse or common-law partner has claimed the charitable donation tax credit since 2007. Monetary donations made by first-time donors after March 20, 2013, qualify for the first-time donor's super credit. The credit can be claimed starting in 2013 and will continue through to 2017. Canadians must donate by December 31st to qualify for a tax credit for the 2013 tax year.

“On behalf of United Way and the more than 100 other charities that we work with, I want to acknowledge the government for its role in encouraging a culture of philanthropy across our country”, said Michael Allen, President and Chief Executive Officer. "In many ways the charitable sector and government need to work together to find creative ways to enable donors to think both with their head and heart about their charitable giving. The holiday season is a great time for first-time donors to consider leveraging this new tax credit while building a better tomorrow for all Canadians."

In 2012, federal tax assistance for charitable donations was more than $2.9 billion. The first-time donor's super credit was introduced in the Economic Action Plan 2013 to encourage new donors to give generously to charities. It provides an extra 25% credit in addition to federal and provincial charitable donation tax credits. This means that donors can get a 40% federal credit for monetary donations of $200 or less, and a 54% federal credit for the part of donations over $200 and up to $1,000.

For more information on the first-time donor's super credit, go to www.cra.gc.ca/fdsc.

For more information on donating wisely, go to www.cra.gc.ca/donors.

Canada Revenue Agency

This a a reproduction copy of an official work that is published by the Government of Canada and that the reproduction has not been produced in affiliation with, or with the endorsement of the Government of Canada.

Monday, December 9, 2013

What’s new for this tax-filing season?

Did you know?
You may be eligible for new or improved tax relief measures and services when filing your 2013 income tax and benefit return.

Important facts
  • First-time donor’s super credit – This new credit for first-time donors gives an extra 25% credit for cash donations when you claim your charitable donations tax credit. This means you can get a 40% federal credit for up to $200 in donations and a 54% credit for the part of donations that is over $200 but not more than $1,000. This is in addition to the provincial credit. For more information, go to www.cra.gc.ca/fdsc.
  • Family caregiver amount – If you have a dependant with an impairment in physical or mental functions, the additional amount you may be able to claim has increased to $2,040 when calculating certain non-refundable tax credits. For more information, go to www.cra.gc.ca/familycaregiver.
  • Pooled registered pension plan (PRPP) – The PRPP is a new retirement savings option for individuals, including those who are self-employed. For more information, go to www.cra.gc.ca/prpp.
  • Adoption expenses – The period to claim adoption expenses has been extended for adoptions finalized in 2013 and later years.
  • Investment tax credit – Eligibility for the mineral exploration tax credit has been extended to flow‑through share agreements entered into before April 1, 2014.
  • Tax-free savings account (TFSA) – The annual TFSA dollar limit increased to $5,500 on January 1, 2013, for the 2013 contribution year, and remains at that amount for the 2014 contribution year.

Canada Revenue Agency

This a a reproduction copy of an official work that is published by the Government of Canada and that the reproduction has not been produced in affiliation with, or with the endorsement of the Government of Canada.

Tuesday, December 3, 2013

Minister Kerry-Lynne Findlay marks International Day of Persons with Disabilities

Ottawa, Ontario, December 3, 2013... The Honourable Kerry-Lynne D. Findlay, P.C., Q.C., M.P., Minister of National Revenue and Member of Parliament for Delta-Richmond East, marked the International Day of Persons with Disabilities today by reminding Canadians that the Harper Government has introduced a number of tax measures and programs to support persons with disabilities, as well as opportunities to save money for the future.

“Our Government is committed to ensuring that persons with disabilities have access to all the information and help they need to receive the tax credits they are entitled to,” said Minister Findlay. “Persons with disabilities and their supporting family members can sometimes shoulder a significant financial burden, and programs such as the disability tax credit help to alleviate that burden.”

The disability tax credit (DTC) helps to reduce the amount of income tax paid by a person with a severe and prolonged impairment in physical or mental functions. This credit can also be transferred to reduce the income tax payable of a supporting family member or spouse of a person with a disability.

“We appreciate the important role that persons with disabilities play in shaping and growing our country. We will continue to strengthen our Economic Action Plan to ensure that persons with disabilities and all Canadians can contribute meaningfully to Canada’s future,” added Minister Findlay.

Once a person with a disability has applied for and is deemed eligible for the DTC, the following credits and programs may be available to them:
  • Registered disability savings plan (RDSP) – An RDSP is a savings plan to help save for the long-term financial security of a person with a disability. Grants and bonds provided by the Government of Canada can help them and their families save for the future.
  • Children’s arts tax credit and children’s fitness tax credit – For each credit, families caring for a child who is eligible for the DTC and is under 18 years of age at the start of the year, can claim up to $1,000 per year, as long as a minimum of $100 was paid for registration or membership fees in eligible programs.
Other credits may be available to those supporting certain family members or relatives who are dependent on them due to a physical or mental infirmity (whether they are eligible for the DTC or not):
  • Caregiver amount – The caregiver amount may be claimed by a person who maintains and lives in a dwelling together with one or more dependants. Each dependant (other than a parent or grandparent) must have been 18 years of age or older and dependent on the supporting person due to an impairment in physical or mental functions.
  • Amount for infirm dependants age 18 or older – This amount may be claimed for dependants who are 18 years of age or older and dependent on a supporting person due to an impairment in physical or mental functions. The dependant does not have to live with the supporting person. The amount for infirm dependants age 18 or older and the caregiver amount cannot both be claimed for the same dependant.
  • Family caregiver amount (FCA) – The FCA may be claimed for a dependant with an impairment in physical or mental functions, and provides an additional amount of $2,000 in calculating each of the following tax credits:
    • spouse or common-law partner amount;
    • amount for an eligible dependant;
    • amount for children under age 18 at the end of the year; and
    • caregiver amount.
    The maximum amount for infirm dependants age 18 or older includes the additional amount of $2,000 for the FCA.
For more information on tax matters for persons with disabilities, go to www.cra.gc.ca/disability.

Canada Revenue Agency

This a a reproduction copy of an official work that is published by the Government of Canada and that the reproduction has not been produced in affiliation with, or with the endorsement of the Government of Canada.