Canada’s proposed tax on vacant land aims to tackle the housing crisis, but could it backfire? While the intention is commendable, experts warn that such measures may distort economic behavior and burden smaller developers. Instead of penalizing real estate developers, a more effective solution might be to offer tax incentives that encourage immediate construction. Drawing lessons from Ireland’s experience with similar policies, this article explores the potential pitfalls of a vacant land tax and advocates for a collaborative approach that benefits both the government and developers. Discover why tax breaks could be the key to solving Canada’s housing shortage.

On September 16, 2024, the federal government unveiled bold mortgage reforms aimed at tackling Canada’s housing crisis and making homeownership more accessible, particularly for younger generations. While these changes seem beneficial at first glance, a closer look reveals a more complex picture, especially for Millennials and Gen Z who are already grappling with high home prices in cities like Toronto and Vancouver.

Are you a Canadian business owner considering selling your company? The new Canadian Entrepreneurs’ Incentive (CEI) could be of benefit. Starting in 2025, this promising tax break will significantly reduce your capital gains tax. With a gradual increase in the lifetime limit to $2 million by 2029, the CEI offers substantial savings for eligible entrepreneurs. However, the draft legislation raises important questions about qualifications and exclusions. Discover how this incentive could impact your business and what clarifications are needed for a smoother implementation.

Navigating the complexities of trust tax filing can be daunting, but there’s good news for 2024! Recent draft legislation will exempt bare trusts from filing tax returns, easing the burden on many Canadians. The definition of Listed Trusts is also expanding, providing more relief for smaller and family trusts. Discover how these changes can simplify your tax obligations and offer greater flexibility in managing your assets. Stay informed on updates that could impact your financial planning—read on to learn more!

As of June 25, 2024, capital gains in Canada are included in income at a 2/3 inclusion rate, up from the previous 1/2 rate. This increases the tax for large gains on investments. However, there’s good news: the first $250,000 of capital gains still benefits from the 1/2 inclusion rate, providing substantial tax savings. For

In this article, we explain how the recent changes in capital gains rates will impact small businesses in Canada. They will affect not only how much they pay in taxes on capital gains but also their regular business income.

Recent changes to capital gains inclusion rates have introduced complexities for corporations managing their Capital Dividend Account (“CDA”). Understanding these changes is crucial as they could result in significant unexpected penalties.

Download PDF Copy Click here to download a PDF copy of the guide below. The PDF guide also contains a sample T3 Return. The Canadian government has recently implemented new reporting requirements for trusts[1]. These changes are in accordance with Canada’s international pledge to disclose beneficial ownership information and to maintain the efficiency and honesty

If you found this newsletter useful, please feel free to pass it on to your team of advisors as it will be useful for them as they also consider your financial, estate, and business plan to preserve and grow your hard-earned wealth.  Sincerely,LRK Tax Team

This newsletter discusses new taxes that will be introduced in 2023 that will affect small business owners in Canada. These include the Underused Housing Tax (UHT) which will apply to foreigners who own vacant homes in Canada, a new minimum tax on the rich, and an anti-flipping tax for real estate investors. The tax rules have become increasingly complex and penalties for non-compliance are high, so it is important to stay informed and work with a qualified tax accountant.

Inflation is often thought of as a gradual increase in prices, but it’s important to remember that it’s also a tax. As prices rise, the purchasing power of your income decreases, meaning you can buy fewer goods and services with the same amount of money. This can significantly impact your finances over time, especially if you’re not aware of how it’s affecting you.

Many experts and analysts are bracing for lacklustre returns in 2023. If you are an investor, you may sell some of your investments and trigger capital losses as you rebalance your portfolio. In this article, we outline some tax strategies that can go hand-in-hand with your investment decision that will put more money into your pockets.

The sentiment that a country ought to “tax the rich” has been circulating the airwaves for several years. With record levels of government spending, impending recession, inflation, an increase in immigration, and funding the Ukrainian war, the government needs more money. It seems like 2023 will be an opportune time for the Canadian government to introduce another round of tax on the rich (when the Liberals came to power in 2015, they also introduced a 4% tax hike on people in the top tax bracket).

The year 2022 was a busy year in the tax world. Coming out of the pandemic and dealing with an uncontrollable real-estate market, the government introduced many tax measures to boost the economy while controlling the housing market. We don’t expect as many tax measures in 2023. But we still expect the government to introduce some significant tax measures.

With rising interest and energy costs, more real-estate investors are expected to sell in 2023. These investors need to watch out for the Anti-Flipping Tax that comes into effect on January 1, 2023.

The Department of Finance has announced the 2023 automobile deduction limits and expense benefit rates for businesses. The amounts have generally gone up because of high inflation in Canada.

In this edition, we cover the following: Please click here to read our December 2022 edition of the LRK Tax Newsletter. The year 2022 was a strange year in the tax world. We came out of the pandemic with a lot of government spending relief programs, a red-hot housing market, and skyrocketing interest rates to

The Canadian banks have increased their prime lending rate to 5.45%. We discuss strategies to mitigate the blow of high interest rates.

The CRA is escalating its scrutiny of personal services businesses towards the end of 2022. CRA typically undertakes campaigns where they focus on a specific issue and cast a large net to identify taxpayers who may be in violation of certain tax rules.

The government released draft legislation under new subsection 160.5(2), which requires making payments and remittances to the CRA through electronic means where the amount of the remittance or payment exceeds $10,000. There is an exception if the payor or remitter cannot reasonably remit or pay the amount electronically. It is unclear what the threshold for

A recent court ruling demonstrates why preparing financial statements is important if you are receiving tax benefits and credits.