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Important: Learn about the key points to Canada's COVID-19 response plan.

Client Communication

The latest updates for our clients regarding our office and policies.

Personal

COVID-19 UPDATES

Posted 20 hours ago

Filing and Payment Extension: 

2019 tax return: Due June 1, 2020
Any new income tax balances due, or installments, to be deferred until after August 31, 2020 without incurring interest or penalties.



Canada Emergency Response Benefit:
To provide a taxable benefit of $2,000 a month for up to 4 months to:

  • workers who must stop working due to COVID19 and do not have access to paid leave or other income support.
  • workers who are sick, quarantined, or taking care of someone who is sick with COVID-19.
  • working parents who must stay home without pay to care for children that are sick or need additional care because of school and daycare closures.
  • workers who still have their employment but are not being paid because there is currently not sufficient work and their employer has asked them not to come to work.
  • wage earners and self-employed individuals, including contract workers, who would not otherwise be eligible for Employment Insurance.

Apply via CRA My Account - Application will be available April 6th with first payment to start 10 days after application.


Canada Child Benefit

An extra $300 per child for 2019-2020 - this benefit will be delivered as part of the scheduled payment in May 2020.



Special Goods and Services Tax credit payment

One-time special payment by early May for low- and modest-income families. Up to $400 for single individuals to $600 for couples.
There is no need to apply for this payment. If you are eligible, you will get it automatically.

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My CRA Account

Posted 1 day ago

 Accessing the government programs corporately and personally requires a CRA My Account.

You can then access Service Canada’s My Service Canada Account and apply for any applicable social benefits

 Once you have proceeded through the registration process, you will be mailed an access or activation code. 

If you are also a business owner you will be able to add your business so that you may access it through the CRA My Business Account.

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Canada's COVID-19 Economic Response Plan - Key Points for Businesses and Individuals

Posted 1 week ago

 

     CANADA’S COVID-19 ECONOMIC RESPONSE PLAN – KEY POINTS FOR BUSINESSES AND INDIVIDUALS

 

Since the beginning of March, restrictions and measures related to COVID-19 have rapidly escalated. While the first stages focused on public health and safety, in very short order, businesses and personal finances began to be affected. It is clear that these challenges will become worse before they get better. In an effort to combat these effects, the Government of Canada released a series of financial measures in mid-March.

 

This document summarizes selected government comments up to March 18, 2020.

INDIVIDUALS

 

Tax Return Due Date Deferral: The personal tax filing due date will be deferred until June 1, 2020. However, those expecting refunds or benefits (such as the GST/HST credit, Guaranteed Income Supplement and Canada Child Benefit) should file as early as possible. The government release encourages Canadians not to delay their filings in order to ensure their income-tested benefits are accurately computed.

 

Tax Payment Deferral: Taxpayers may defer, until after August 31, 2020, the payment of income tax amounts that become owing on or after March 18, 2020 (also including installments) and before September 2020. The government documents indicate that payment will be deferred “until after August 31, 2020”, which seems to imply payment will be due on September 1. No interest or penalties will accumulate on these amounts during this period.

 

Individuals Without Paid Sick Leave: For Canadians without paid sick leave (or similar workplace accommodation) who are sick, quarantined or forced to stay home to care for children, the government is:

·         Waiving the one-week waiting period for those in imposed quarantine that claim Employment Insurance (EI) sickness benefits, effective March 15, 2020.

·         Waiving the requirement to provide a medical certificate to access EI sickness benefits.

·         Introducing the Emergency Care Benefit providing up to $900 bi-weekly, for up to 15 weeks (comparable to EI sickness benefit). This benefit would provide income support to:

o   workers, including the self-employed, who are quarantined or sick with COVID-19 but do not qualify for EI sickness benefits;

o   workers, including the self-employed, who are taking care of a family member who is sick with COVID-19, such as an elderly parent, but do not quality for EI sickness benefits; and

o   parents with children who require care or supervision due to school closures, and are unable to earn employment income, regardless of whether they qualify for EI or not.

 

Application for the Benefit will be available in April 2020, and require Canadians to attest (and continue to attest every two weeks) that they meet the eligibility requirements. Individuals can apply through CRA’s MyAccount, their My Service Canada Account, or by calling an automated toll-free number not yet released.

 

Longer-Term Income Support

·         An Emergency Support Benefit will provide up to $5.0 billion in support to workers who are not eligible for EI and who are facing unemployment. The individual amounts and process will be disclosed shortly.

·         Implementing changes to the EI Work Sharing Program, which provides EI benefits to workers who agree to reduce their normal working hour as a result of developments beyond the control of their employers, by extending the eligibility of such agreements to 76 weeks, easing eligibility requirements, and streamlining the application process.

·         Low/Modest Income Individuals

o   A one-time special payment by early May 2020 through the Goods and Services Tax credit (GSTC) will be made. This will double the maximum annual GSTC payment amounts and result in an average boost to income for those benefiting by close to $400 for single individuals and close to $600 for couples.

o   The maximum annual Canada Child Benefit payment amounts would be increased by $300 per child for the 2019-20 benefit year. This will be added to the May, 2020 benefit cheque.

·         Canadians Abroad: The Emergency Loan Program for Canadians Abroad will provide the option of an emergency loan to Canadians in need of immediate financial assistance to return home or to temporarily cover their life-sustaining needs while they work toward their return. Each application will be assessed according to their specific situation and needs. This emergency assistance is a repayable loan. Eligible Canadians currently outside Canada and needing help to return home can contact the nearest Government of Canada office (https://travel.gc.ca/assistance/embassies-consulates) or Global Affairs Canada’s 24/7 Emergency Watch and Response Centre in Ottawa at +1 613-996-8885 (collect calls are accepted where available) or email sos@international.gc.ca.

·         Students: A six-month interest-free moratorium on the repayment of Canada Student Loans for all individuals currently in the process of repaying these loans will be provided.

·         Minimum RRIF Withdrawals: The required minimum withdrawals from Registered Retirement Income Funds (RRIFs) will be reduced by 25% for 2020. Similar rules would apply to individuals receiving variable benefit payments under a defined contribution Registered Pension Plan.

BUSINESSES

 

Tax Payment Extension: Businesses may defer, until after August 31, 2020, the payment of income tax amounts that become owing on or after March 18, 2020 and before September 2020. This relief would apply to tax balances due, as well as installments. No interest or penalties will accumulate on these amounts during this period.

Other Payment and Filing Extensions: No comment was made about changing the filing and payments dates for payroll, GST/HST, and other non-income tax items.

CRA Audit Activity: CRA will not contact any small or medium businesses to initiate any post assessment GST/HST or Income Tax audits for the next four weeks. For the vast majority of businesses, the CRA will temporarily suspend audit interaction with taxpayers and representatives.

Liaison Officer Service: The Liaison Officer service is now available over the phone and will be customizing information by ensuring small businesses are aware of any changes such as filing and payment deadlines, proactive relief measures, etc.

Payroll Subsidies: The government is proposing to provide eligible small employers a temporary wage subsidy for a period of three months. The subsidy will be equal to 10% of remuneration paid during that period, up to a maximum of $1,375 per employee and $25,000 per employer. Businesses will benefit immediately from this support by reducing their remittances of income tax withheld on their employees’ remuneration. Employers benefiting from this measure will include corporations eligible for the small business deduction, as well as non-profit organizations and charities.


OTHER FILINGS AND ADMINISTRATION

 

Trust Filing Due Date Deferral: For trusts having a taxation year ending on December 31, 2019, the return filing due date will be deferred until May 1, 2020.

 T3 Slips Submission Date: No specific statement was made regarding the deadline for filing T3 slips reporting income taxable to the trust beneficiaries.

 Other Returns: Many taxpayers are required to file other tax and information returns. No mention was made of these, including partnership returns and NR4 reporting slips.

 EFILE Signatures: In order to reduce the necessity for taxpayers and tax preparers to meet in person, effective immediately the CRA will recognize electronic signatures as having met the signature requirements of the Income Tax Act, as a temporary administrative measure. This provision applies to authorization forms T183 or T183CORP.

FINANCIAL ASSISTANCE

 

Individuals: Canada’s large banks have confirmed that this support will include up to a 6-month payment deferral for mortgages, and the opportunity for relief on other credit products. Banks have affirmed their commitment to working with customers to provide flexible solutions, on a case-by-case basis, for managing through hardships caused by recent developments. This may include situations such as pay disruption, childcare disruption, or illness.

 Businesses

·         The Business Credit Availability Program will allow the Business Development Bank of Canada and Export Development Canada to provide more than $10 billion of additional support, largely targeted to small and medium-sized businesses. The near-term credit available to farmers and the agri-food sector will also be increased through Farm Credit Canada.

·         The Office of the Superintendent of Financial Institutions (OSFI) announced it is lowering the Domestic Stability Buffer by 1.25% of risk-weighted assets, effective immediately. This action will allow Canada’s large banks to inject $300 billion of additional lending in to the economy.

·         For Exporters: The Minister of Finance would now be able to determine the limit of the Canada Account in order to deal with exceptional circumstances. The Canada Account is administered by Export Development Canada (EDC) and is used by the government to support exporters when deemed to be in the national interest.

 ·         Interest Rates: The Bank of Canada cut the prime interest rate to 0.75%. Other banks have also reduced rates.

Other Funding

·         Indigenous Community: $305 million for a new distinctions-based Indigenous Community Support Fund will be provided to address immediate needs in First Nations, Inuit, and Métis Nation communities.

·         Homelessness: The Reaching Home initiative will be provided with $157.5 million to continue to support people experiencing homelessness during the COVID-19 outbreak. The funding could be used for a range of needs such as purchasing beds and physical barriers for social distancing and securing accommodation to reduce overcrowding in shelters.

·         Domestic Abuse Shelters: Women’s shelters and sexual assault centers will receive $50 million to help with their capacity to manage or prevent an outbreak in their facilities.

CLOSING

 

Many of the measures listed above have only been announced recently (March 18, 2020) and are noted as requiring Royal Assent. In recent public comments, it was indicated that the opposition parties have promised their support to move these measures quickly, therefore, we can presumably expect draft legislation in the short term.

 

Over the next days and weeks, the specifics on these programs will be released. Most of the details for these initiatives will be released on one of these four webpages:

 

General: https://www.canada.ca/en/public-health/services/diseases/2019-novel-coronavirus-infection/canadas-reponse.html


CRA: https://www.canada.ca/en/revenue-agency/campaigns/covid-19-update.html

 

Travel: https://travel.gc.ca/assistance/emergency-info/financial-assistance/covid-19-financial-help


Employment and Social Development Canada:
https://www.canada.ca/en/employment-social-development/corporate/notices/coronavirus.html

 

As the situation develops further, there may be additional government measures, or modifications to those already announced.

 

  

The preceding information is for educational purposes only. As it is impossible to include all situations, circumstances and exceptions in a newsletter such as this, a further review should be done by a qualified professional.

 

No individual or organization involved in either the preparation or distribution of this letter accepts any contractual, tortious, or any other form of liability for its contents or for any consequences arising from its use.

  

 

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Pre-Authorized Debit for Personal Tax Owing (PAD)

Posted 4 months ago

CRA now has the ability to withdraw a specified amount from your bank account on the date you specify (April 30th most likely).

To do this, you need to complete in Part G of the T183 form - pre-authorized debit agreement.

You can specify the account for which you prefer the pre-authorized debit to come from on the T183 or select an account the CRA may already have on file for your for direct deposit.

Please note that the CRA requires at least 5 business days to process the PAD. Therefore, if you choose to have your PAD taken from your bank account on April 30th, your return MUST be filed no later than April 24, 2019.

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New to Personal Tax

Posted 4 months ago

1) The 2020 cumulative lifetime capital gains exemption is $883,384.00

2) The Medical expense tax credit has been expanded to allow expenses related to service animals who are specially trained to perform specific tasks for a patient with a severe mental impairment that helps the patient cope with the impairment. Eligible expenses paid in 2018 include the cost of the animal, the care and maintenance of the animal (food and veterinary care), reasonable travel expenses paid for the patient to attend a school, institution, or other facility that trains in the handling of these animals, and reasonable board and lodging expenses paid for the patient's full-time attendance at a school, institution, or other facility that trains in the handling of such animals.

3) The Climate Action Incentive (CAI) payment can be claimed by eligible individuals who are residents of Saskatchewan, Manitoba, Ontario or New Brunswick. A new Schedule 14 will be included with the T1 package for these jurisdictions; simply complete the new schedule to claim the amounts you may be entitled to based on your family composition, and indicate the amount on line 449 of your income tax and benefit return. The CAI payment will first reduce any balance owing, and may create or increase your refund. A 10% CAI supplement is available to residents of small and rural communities who live outside a Census Metropolitan Area (CMA), as defined by Statistics Canada.

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Updates to Personal Tax in Recent Years

Posted 4 months ago

1) The 2018 cumulative lifetime capital gains exemption is $848,252.

2) Starting with the 2016 taxation year, individuals who sell their principle residence will have to report the sale on their tax return. Reporting will be required for sales that occur on or after January 1, 2016 but there is likely no tax implications.

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Business

COVID-19 UPDATES

Posted 5 days ago

BUSINESSES

 March 31, 2020

Corporate Tax Return – Filing and Payment Extension

Filing date for current tax year: extended to June 1, 2020 (corporations with a due date after March 18 and before June 1, 2020)

Payment date for current tax year: extended to September 1, 2020 (balances and installments due on or after March 18 and before September 1, 2020)

Source:  https://www.canada.ca/en/revenue-agency/campaigns/covid-19-update/covid-19-filing-payment-dates.html


HST – Payment Extension

Payment remittance (including installments) requirement extended to June 30, 2020 for balances due after March 18 and before March 31, 2020. 


WSIB - 
Filing and Payment Extension

Premium reporting and payment deferred to August 31, 2020.

Additionally, the WSIB will cease interest accrual on all outstanding premium payments. They will not charge penalties during this six-month deferral period.

Source: 
https://www.wsib.ca/en/financialrelief


Canada Emergency Business Account

Interest-free loans of up to $40,000 to small businesses and not-for-profits, to help cover their operating costs during a period where their revenues have been temporarily reduced.


To qualify, these organizations will need to demonstrate they paid between $50,000 to $1 million in total payroll in 2019.

 Source: https://www.canada.ca/en/department-finance/programs/financial-sector-policy/business-credit-availability-program.html


March 30, 2020

Temporary Wage Subsidy:

“Businesses and non-profit organizations seeing a drop of at least 30 per cent in revenue due to COVID-19 will qualify for the government's 75 per cent wage subsidy program, Prime Minister Justin Trudeau announced today.

During the daily media briefing outside his residence at Rideau Cottage, Trudeau said the number of people a business employs will not determine its eligibility. Charities and companies big and small will qualify, he said.

For those companies experiencing a decrease in revenues of at least 30 per cent, the government will cover up to 75 per cent of a salary on the first $58,700, which could mean payments of up to $847 a week. The prime minister also encouraged businesses to top up their employee’s wages with the remaining 25 per cent of their salaries.

Trudeau said the wage subsidies will be retroactive to March 15, 2020.

More details of the program will be unveiled later today.”

Source: https://www.cbc.ca/news/politics/trudeau-covid19-business-supports-1.5514558

March 27, 2020

As the changes to the response to COVID-19 are constantly evolving we will continue to keep you posted with updates

1. The government will also guarantee bank loans of up to $40,000 for small businesses 
2. HST payments are suspended to June.

Read communication

Temporary Wage Subsidy for Employers

Posted 1 week ago

Am I an eligible employer?

You are an eligible employer if you:

  • are a non-profit organization, registered charity, or a Canadian-controlled private corporation (CCPC);
  • have an existing business number and payroll program account with the CRA on March 18, 2020; and
  • pay salary, wages, bonuses, or other remuneration to an employee.

Note: CCPCs are only eligible for the subsidy if their taxable capital employed in Canada for the preceding taxation year, calculated on an associated group basis, is less than $15 million.

 

How much is the subsidy?

The subsidy is equal to 10% of the remuneration you pay between March 18, 2020, and June 20, 2020, up to $1,375 per employee and to a maximum of $25,000 total per employer. Please know payroll must continue and be paid in order to take advantage of this subsidy, if you stop payroll this is not available.

 

An annual salary of $55,000 per employee will result in getting the maximum benefit.

 

Owner Payroll:

If you do not get a regular pay cheque this will not work for you. Clients that do lump sum payments should consider going on regular payroll effective immediately until June 20, 2020.

In order for you to take advantage of this subsidy with your personal payroll – your gross payroll paid needs to be $13,750 over March 18, 2020, and June 20, 2020 in order to receive the maximum subsidy of $1,375.

 

How will I receive the subsidy?

The subsidy is claimed by reducing the tax portion of your monthly remittance.  It cannot be applied against the CPP and EI.

 

When can I start reducing remittances?

You can start reducing your source deduction remittances in the first remittance period that includes remuneration paid between March 18, 2020, and June 20, 2020.

If you use a payroll service please advise them of your qualification.

 

How do I calculate the subsidy?

For example, if you have 5 employees earning monthly salaries of $4,100 (assumes all are under $55K annually) for a total monthly payroll of $20,500, the subsidy would be 10% of $20,500, or $2,050.

For more information:  https://www.canada.ca/en/revenue-agency/campaigns/covid-19-update/frequently-asked-questions-wage-subsidy-small-businesses.html

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