Under current tax legislation, physicians are entitled to split their income with family members, effectively making spouses and children shareholders in their professional corporations. This is known as income splitting, or “income sprinkling.”
In its communications, the federal Department of Finance is portraying these advantages as unfair to other middle class taxpayers, the bulk of whom are salaried employees.
If you are planning to make a significant donation to a Canadian registered charity in 2016, you might want to consider stocks. Donating stocks can be a tax efficient way to make a contribution, provided that you keep the following considerations in mind.
On July 18, the Department of Finance released their discussion paper announcing proposed changes to tax planning using private corporations. Last week, on August 10, GGFL’s Tax Partner Chad Saikaley and Tax Manager Kody Wilson hosted a webinar highlighting the potential impact from the proposed changes. These changes include income sprinkling, lifetime capital gains exemption […]
Tax Partner Chad Saikaley provides his insights into why the proposed tax reforms don’t crack down on the wealthy but, instead, threaten small business.
At GGFL, we are proud to announce that our firm has been awarded the Best of Accounting Award for Client Service Excellence. The award is based on the results of a major survey in which more than 70 per cent of our clients gave GGFL a satisfaction rating of either 10 out of 10 or 9 out of 10.
The Department of Finance proposals include measures to limit the ability to claim the lifetime capital gains exemption (LCGE) on dispositions after 2017. The LCGE is an exemption available to Canadian residents in respect of capital gains realized on the disposition (sale or transfer) of certain types of property. The proposals are intended to target common planning strategies that multiply the LCGE, whether through a family trust or otherwise, by having shares held by family members.
The Department of Finance’s proposals aim for an individual to pay the same amount of tax on investment income, regardless of whether the income was earned personally or through a corporation. The proposals eliminate the perceived advantages of investing the after-tax income in a corporation.
In general, when an individual sells shares of a corporation for an amount in excess of what they paid for the shares, they realize a capital gain. Depending upon the assets of the company, and the personal tax history of the vendor, the capital gain may or may not be eligible to be offset by a capital gains deduction such that no personal tax is paid.
The proposed legislation announced in July by the Finance Department will significantly increase the reach of the TOSI to include amounts paid to certain adult individuals who receive split income.
Given that the personal tax deadline has passed, it may seem odd to see an article regarding personal tax planning; however, there is no better time than now to plan for next year. As the old saying goes… the early bird gets the worm.