Niagara full service accounting firm serving individuals and small business.
New for 2016 tax returns
 
REPORT THE SALE OF YOUR PRINCIPAL RESIDENCE
 
 
You must now report the sale of your principal residence, along with any principal residence designation, on your 2016 tax return.  The sale will be reported on Schedule 3 of your tax return.  You will need to report the year you purchased the property, the address of the property and how much it was sold for.

If you don't report the sale of the property there is the potential that you will not be allowed the princpal residence exemption and the sale will be subject to tax. You will be allowed to amend your tax return if you forgot to report the sale but there will be a penalty.

The penalty is the lesser of the following amounts:
      $8,000; or
      $100 for each complete month from the original due date to the date your request was made in a form satisfactory to the CRA.



 
HOME ACCESSIBILITY EXPENSES
 
Starting on your 2016 tax return you can claim a federal tax credit on qualifying renovations or expenses up to $10,000.  A qualifying renovation is a renovation or alteration that is of an enduring nature and is integral to the eligible dwelling (including the land that forms part of the eligible dwelling).
The renovation must:

     - allow the qualifying individual to gain access to, or to be mobile or functional within, the dwelling; or
     - reduce the risk of harm to the qualifying individual within the dwelling or in gaining access to the dwelling.
An item you buy that will not become a permanent part of your dwelling is generally not eligible.

In order to claim this credit:
     - You must be 65 years or older at the end of the tax year or
     - Be eligible for the disability tax credit or
     - Be the spouse of one of the above or 
     - You would have been able to claim the individual as an eligible dependent or claim the caregiver amount. This should be reviewed with your accountant

     
 

 
GROUP SICKNESS ACCIDENT PLANS
 
Employer contributions to a group sickness or accident insurance plan will now be included in an employee's income for the year in which the contributions are made to the extent that the contributions are not in respect of a wage-loss replacement benefit payayable on a periodic basis.  This applies to employer contributions made on or after March 3, 2012 to the extent that the contributions relate to coverage after 2012.  For more information please click on the following link: Canada Revenue Agency

 
CANADA PENSION PLAN

On January 1, 2012 there are new rules that came into effect regarding who must contribute to CPP.  If you are under the age of 65 you must contribute to CPP even if you are already receiving the CPP retirement pension.

If you are 65 to 70 you must also contribute to CPP UNLESS you have completed the form Election to Stop Contributing to the Canada Pension Plan. The form must be given to your employer and a copy sent to the Winnipeg Tax Centre.

The form can be opened with the following link: Election to Stop Contributing to CPP
 
COMBINED FEDERAL AND ONTARIO MARGINAL TAX RATES -- 2014(1)(2)
 
Taxable
Income
Ordinary
Income
Capital
Gains
Eligible
Dividend
Non-Eligible
Dividend
         
At  11,137 20.05 10.03 (1.89)  5.35
At  40,121 24.15 12.08  3.77  10.19
At  43,954 31.15 15.58 13.43 18.45
At  70,644** 32.98 16.49 14.19 20.61
At  80.243 35.39 17.70 17.52 23.45
At  83,247** 39.41 19.70 19.88 28.19
At  87,908 43.41 21.70 25.40 32.91
At 136,270 46.41 23.20 29.54 36.45
At 514,091 49.53 24.76 33.85 40.13














 


^ Eligible dividend range of -1.89% to 0% at taxable income of $11,137
   Eligible dividend range of 3.77 per cent to 3.80 per cent at taxable income of $40,121
**provincial surtaxes apply

(1) Tax rates before personal credits are applied, except for Ontario surtax,
denoted as a double asterisk (**), which is net of the basic personal credit
only. See the section on Federal and Ontario Non-Refundable Tax Credits,
beginning on page 83, as well as Appendix I, beginning on page 123, for tax
credit information. It is assumed each bracket is composed of ordinary
income. The rate indicated is the marginal rate for additional income of the
type noted.

(2) The increased tax bracket limits for 2014, on the previous page, assume a
federal CPI adjustment of 0.9 per cent and a provincial CPI adjustment of 1.0
per cent in 2014.

The above table is on page 132 of the 2013-14 Personal Tax Planning Guide.
The link to the guide is below.

Personal Tax Guide 2011-2012

Personal Tax Guide 2013-2014

Niagara full service accounting firm serving individuals and small business.
Niagara full service accounting firm serving individuals and small business.