All About Estates

Category: Canada Revenue Agency

Total 119 Posts

Voluntary disclosures – changes are coming!

Last week I met a couple who came in to see me for help with missed tax filings.  They were both aware of the potential for tax penalties and related interest on overdue tax and contemplated “leaving sleeping dogs lie”.  When asked how well they sleep at night, their response…

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Ontario’s Non-Resident Speculation Tax

Recently the Government of Ontario followed the heels of the British Columbia Government by introducing a “non-resident speculation tax” (“NRST”). The NRST will apply to the purchase or acquisition of an interest in residential property located in the Greater Golden Horseshoe (the “GGH”) by individuals who are not Canadian citizens…

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The Prescribed Rate is About to Change – for Real this Time?

The prescribed rate is the minimum interest rate prescribed by the Canada Revenue Agency (“CRA”) that should be charged on various non-arm’s loans such as those made by you to your spouse or child (through a family trust). Such loans are a common device to split income with others in…

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Old Age Security Clawback – Grossed-Up vs Actual Dividends

The Canada Revenue Agency (CRA) was reminded by a taxpayer individual about a perceived lack of fairness when required to include the dividends received at a grossed-up amount when calculating net income rather than only including the actual amount of dividends received. The taxpayer felt this was unfair because net…

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JOINT TENANCY AND PROBATE AVOIDANCE – A QUICK REVISIT

When developing estate plans for clients with property of a capital nature (real estate, marketable securities being a couple of examples), one of the questions I get asked more often than not is: How can I avoid probate? Can I just put someone else’s name on a document so it…

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Gift returned receipt required

The Canada Revenue Agency was asked to speak to the implications of a gift return and their response included some commentary on the impact on the donor. The situation the CRA was asked to consider involved an individual taxpayer who, in 1981, gave a whole life insurance policy to a…

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TAXATION OF DEPRECIABLE PROPERTY TRANSFERS INVOLVING TRUSTS

Pursuant to a certain provision of the Income Tax Act (“ITA”), if in the transfer of depreciable property between related parties, the actual cost to the transferee would otherwise exceed the capital cost (for tax purposes) to the transferor, the capital cost to the transferee is limited to the sum…

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Principal residence and the change in use

It is not unusual for find the value of a deceased’s home makes up a significant part of their net worth and estate value on death. Often there is an automatic reliance on the principal residence exemption to tax exempt the gain on the deemed sale triggered on death.  What…

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DEATH BENEFITS: CAN THEY BE APPLIED TO THE INCORPORATED OWNER-OPERATOR?

A death benefit is an amount received after a person’s death for their employment service. In general, any amount up to $10,000 received is not subject to tax, pursuant to regulations contained in the Income Act (“ITA”). What if the deceased was the sole shareholder of a corporation and received…

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OFFSHORE ESTATE PLANNING AND MONEY TRANSFERS: A WORD OF CAUTION

Just I am completing my personal income tax return and assisting many others with theirs, I continue to cling to the belief that most Canadians pay their fair shares of taxes. However, it appears many do not by “hiding” their money in offshore tax havens, sometimes under the guise of…

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