Business Matters April and June 2022

Dear Client:

Business Matters

Attached are the April and June/22 editions of Business Matters.

APRIL 2022

The first two articles in the April edition deal with personal finance items – buying/owning a vehicle and discussing finances as a couple.

Owning a Vehicle

The vehicle ownership article has a great discussion about costs. Key quote from page 2 near the bottom “that means the longer you can keep a car running on the road in good condition, the less you will end up spending.”    

Tough Financial Talks

“Turn those tough financial talks into united lifelong goals” by having meaningful conversations with your partner about money. Fund out how to do this by reading the article.

Can We Issue a Charitable Receipt?

We are a not-for-profit organization. We know of a great cause that needs our support. How can we hold a fundraising event, issue charitable receipts and not be offside with Canada Revenue Agency?  The Tax article on pages 5 and 6 will go a long way to answering all of your questions. A must read for Board members of charities and not-for-profits.

Self-Employment

We have many unincorporated, self-employed clients. The Tax article on pages 7 and 8 provides a very good discussion of issues that individuals will face in their first year of being self-employed. One item not discussed is Canada pension plan contributions (CPP). The CPP contribution rate is basically 10% of net income greater than $3,500.  CPP can often amount to more than income tax in the first year or two of operating a business.

JUNE 2022

The high cost of housing especially for first-time home buyers has been a hot topic for politicians, economists and others for many years. There were two new proposals in Budget 22:

  •        First Home Savings Account – this is an entirely new concept. Search online for details or read the article.

  •       Doubling the first-time home buyers’ tax credit amount to $10,000 – cash savings $1,500

Programs that existed before Budget 22 and continue to be in effect:

  •    RRSP Home Buyers’ Plan

  •       First-time Home Buyer Incentive

  •       GST/HST rebate on new homes

  •      Rebates of land transfer taxes (not in Manitoba)

Personal tax measures in Budget 22 included the following:

  •        Multi-generational home renovation tax credit

  •       Home accessibility tax credit

  •        Labour mobility deduction for tradespeople

  •        Small expansion to the type of expenses eligible for the medical expense tax credit

  •       Higher tax rate on income earned by “flipping” property

There were also a number of Corporate tax changes most of which were very specific. Details are on pages 5 and 6 of the attachment.

Death and Taxes

This article is good at explaining the income tax consequences if you die with a surviving spouse, without a surviving spouse and without a will.  Read on.

Estate Planning

The final article concerns Estate Planning – wills, power of attorneys, executors, life insurance, trusts, etc.  The goals are to minimize income tax and allow for as smooth a transition as possible.

That’s it!

All the best as we transition from summer to fall.