Budget 2019: Personal Income Tax Measures, Part 2
1. Medical Expense Tax Credit: Last year, access to cannabis is subject to the Cannabis Regulations under the Cannabis Act. Eligible expenses for the medical expense tax credit will also include expenses for other classes of cannabis products purchased for a patient for medical purposes. Budget 2019 proposes to amend the Income Tax Acct to reflect the current regulations for accessing cannabis for medical purposes.
2. Contributions to a specified multi-employer plan (SMEP) for older members: Budget 2019 proposes to amend the tax rules to prohibit contributions to a SMEP in respect of a member after the end of the year the member attains 71 years of age and to a defined benefit provision of a SMEP if the member is receiving a pension for the plan. This proposal will ensure that employers do not make pension contributions on behalf of older SMEP members in these situations from which they cannot benefit.
3. Pensionable Service under an Individual Pension Plan (IPP): Budget 2019 proposes to prohibit IPPs from providing retirement benefits in respect of past years of employment that were pensionable service under a defined benefit plan of an employer other than the IPP’s participating employer (or its predecessor employer).
4. Mutual Funds: Allocation to Redeemers Methodology: Budget 2019 proposes to introduce a new rule that would deny a mutual fund trust a deduction in respect of the portion of an allocation made to a unitholder on a redemption of a unit of the mutual fund trust that is greater than the capital gain that would otherwise have been realized by the unitholder on the redemption, if the following conditions are met – the allocated amount is a capital gain and the unitholder’s redemption proceeds are reduced by the allocation.
5. Carrying on a business in a Tax-Free Savings Account: Budget 2019 proposes that the joint and several liability for tax owing on income from carrying on a business in a TFSA be extended to the TFSA holder.
6. Electronic Delivery of Requirements for Information: Budget 2019 proposes to allow CRA to send requirements for information electronically to banks and credit unions. The CRA will be allowed to send requirements for information electronically to a bank or credit union only if the bank or credit union notifies CRA that it consents to this method of service.