Canadian Tax Podcast for the week of March 29, 2021. This week we cover:

• Coinsquare account info release;
• Carbon tax;
• Federal Budget announced;
• Ontario Budget released;
• Expense/deduction planning for the newly self-employed;
• T1135 reporting re. personal use property and foreign currency;
• Sale of property in a corporation, triggering capital gains;

“This is the Canadian Tax Podcast, Episode # 005,  hosted by me, Cameron Ware. Good morning”

• “Happy Monday, it is the week of March 29, 2021. We’ll start with the news.

• Federal judge ordered Coinsquare to hand over client info;
• Threshold for reporting was accounts holding over $20,000;
• Goes back to Jan 01/13;
• Uses CRA tool called “Unnamed Persons Requirement”
• From CRA’s site: “enables the CRA to obtain information from an individual or a company about third parties. After the CRA gets this information, it can verify if the unnamed person correctly reported  income and sales tax…”
• https://www.canada.ca/en/revenue-agency/programs/about-canada-revenue-agency-cra/compliance/real-estate-sector/unnamed-persons-requirements.html
• https://nationalpost.com/news/canada/major-canadian-cryptocurrency-marketplace-must-fork-over-details-of-thousands-of-clients-to-cra-court-rules

• Supreme Court ruled 6-3 in favour of Feds pushing a carbon tax.
• Alberta/West unhappy.
• https://www.cbc.ca/news/canada/calgary/kenney-jonathan-wilkinson-west-centre-kathleen-petty-1.5967214

• Last week Freeland announced new Budget.
• Date set for April 19th 2021.
• Freeland Quote during question period: “Canada entered this global pandemic in a strong fiscal position, which allows our government to provide unprecedented support to Canadians. We will continue to do whatever it takes to support Canadians and Canadian businesses, and we have a plan for jobs, and robust growth,”
• I hope so. End of March/19 deficit was $19.7bil. At the end of 2020, at about $381bil.
• https://www.canada.ca/en/department-finance/news/2021/03/government-of-canada-announces-date-of-budget-2021.html

• March 24, Ontario budget released;
• Run a $33bil deficit;
• On track to balance in 2029/20
• https://budget.ontario.ca/2021/contents.html

• Newly self-employed.
  • [quote]
  • Yes, use an tax calculator and plug/play numbers;
  • Buy some tax software and model;
  • Pro-tip: Use Excel;
  • Best bet: get an accountant to model;
  • https://www.wealthsimple.com/en-ca/tool/tax-calculator/
  • https://www.taxtips.ca/calculators.htm
• Personal Use Property/T1135
  • [quote]
  • Does not need to be reported. “Specified” foreign property.
  • “a personal-use property as defined in section 54 of the Act.”
  • Good rule: Not income-producing.
  • Report on Schedule 3
  • Question about foreign currency from sale. If it’s held in a US bank account, sits in a US bank account, earns interest in a US bank account, yes. Sitting in a lawyer trust account waiting to transfer to CDN account? Beneficial ownership, maybe not.
  • Thing about T1135 is it doesn’t hurt to file anyway. It’s a disclosure form.
  • https://www.canada.ca/content/dam/cra-arc/formspubs/pbg/t1135/t1135-19e.pdf
• Sale of Land
  • [quote]
  • Tax at corp level, tax at personal level;
  • Corp: $550/2 = $275k CDA, $275k pay corp tax.
  • Artificially-high tax “Refundable tax”, until you pay out a dividend = trigger refund of RDTOH.
  • CDA = T2054 CDA election
  • https://www.canada.ca/content/dam/cra-arc/formspubs/pbg/t2054/t2054-20e.pdf
  • Date things correctly, pay out the balance.
  • Personal portion: Pay out dividends over time, keep in low tax rate.

That will wrap things up for today. Like always, if you have any questions, send them to [email protected], or find us on twitter: https://twitter.com/cdntaxpodcast  

This is Canadian Tax Podcast, thanks for listening.