The CRA has recently announced that it is publishing a series of studies on Canada’s tax gap. Tax gap is the term used to describe the difference between the government’s potential tax revenue and the actual taxes collected.To examine the different parts of the gap, the CRA conducted four studies: 1. A conceptual study on tax gap estimation (June 2016)2. An estimate of the tax gap for GST/HST (June 2016)3. A report on domestic personal income tax compliance in Canada (June 2017)4. International Tax Gap and Compliance Results for the Federal Personal Income Tax System (July 2018)The fourth study, the latest...
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The Canadian Government through the Department of Finance recently released a draft technical changes to the Goods and Services Tax / Harmonized Sales Tax (GST/HST) rules for sales of carbon emission allowances, such as those traded in cap and trade systems. Effective as of June 27th, 2018, the purchaser of carbon emission allowances is responsible for self-assessing the tax amount when the GST/HST is payable on such a sale. This change replaces the previous requirement where the seller of the allowance collected the tax from the purchaser and remitted it to the CRA. The Department of Finance notes that this rule...
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On our last blog, we shared a bit of background on the Auditor General’s report stating that the CRA’s call centres did not provide taxpayers with timely access to call centre agents as well as some of the steps taken by the CRA to respond to this report. On this blog, we’ll take a look at the other measures that the CRA has implemented in order to improve the call centre’s service and accessibility. With previous investments from Budget 2016, the CRA has hired more agents to improve its telephone service and accessibility. Last year, the CRA had an average of...
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Last year, the Auditor General released a report with regards to the CRA’s Call Centres (2017 Fall Reports of the Auditor General of Canada). In this report, the Auditor General concluded that the CRA’s call centres did not provide taxpayers with timely access to call centre agents. Prior to the release of this report, the CRA claimed that it met its targets for both access and timelines. The Auditor General report, however, noted that the performance measures used by the CRA were incomplete and its call centres’ results were overstated. Some of the highlights of the Auditor General’s report include:• CRA...
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Are you waiting for your income tax objection to be resolved? Here is an update on the timelines with regards to the assignment and resolution of income tax objections based on its complexity. 1. The majority of low complexity objections now being assigned to an appeals officer were received in January 2018. Objections resolved in March 2018 were completed in an average of 81 days from the date the objection was submitted. Low complexity objections often involve issues such as individual tax credits, personal deductions, Canada Child Benefit and Disability Tax Credit. 2. The majority of medium complexity objections now being...
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On our last blog, we listed the highlights of the tax plan. In this blog, we’ll look into the details of these highlights. - A new Interactive Digital Media Tax Credit worth 25% of eligible labour costs: The new refundable tax credit was created to attract and retain employment and investment in a growing global industry. This tax credit will provide eligible interactive digital media companies with a benefit worth 25% of eligible labour costs incurred after April 1, 2018. - An extension of the Alberta investor Tax Credit and Capital Investment Tax Credit to 2021-22: The Alberta Investor Tax Credit...
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The Alberta Budget 2018 focuses on maintaining a competitive tax system to promote investment, economic diversification and make life more affordable for all Albertans. The 2018 tax plan’s highlights include: - A new Interactive Digital Media Tax Credit worth 25% of eligible labour costs.- An extension of the Alberta investor Tax Credit and Capital Investment Tax Credit to 2021-22.- Indexation of the personal income tax system, saving Albertans $65 million in 2018.- Holding the total amount collected from education property taxes steady at the 2017-2018 level.- Confirmation of the tax revenue collection mechanism for cannabis. Alberta Budget 2018 mentions that our...
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If you are applying for the Disability Tax Credit (DTC), you can now get a nurse practitioner to fill out and sign your Form T2201, Disability Tax Credit Certificate. The Federal Government made a change to recognize nurse practitioners as one of the medical practitioners who can certify Form T2201 through Budget 2017. This change will provide a huge benefit for individuals applying for the Disability Tax Credit who live in an area where a nurse practitioner is their first point of contact. This ensures that all Canadians who want to apply for the DTC will be able to do so...
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Here are the Sales and Excise Tax Measures included in Budget 2018. GST/HST and Investment Limited Partnerships: Budget 2018 proposes measures so that the GST/HST applies to management and administrative services rendered by the general partner on or after September 8, 2017, and not to management and administrative services rendered by the general partner before September 8, 2017 unless the general partner charged GST/HST in respect of such services before that date. Budget 2018 also proposes that the GST/HST be generally payable on the fair market value of management and administrative services in the period in which these services are rendered....
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Enhancement of the Canada Workers Benefit: The Working Income Tax Benefit is a refundable tax credit that supplements the earnings of low-income workers. Last year, the Government announced that they intend to enhance the benefits provided by the Working Income Tax Benefit by an additional %500 million starting in 2019. Budget 2018 proposes to rename the program to the Canada Workers Benefit. Also, Budget 2018 proposes that for 2019, the amount of the benefit be equal to 26% of each dollar of earned income in excess of $3,000 to a maximum benefit of $1,355 for single individuals without dependents and $2,335...
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