Are you a small business owner wondering how the proposed tax changes may impact you and your business?

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Are you a small business owner wondering how the proposed tax changes may impact you and your business?

Introduction

When the Liberal government announced the 2017 Federal budget on March 22, 2017, they promised the issuance of a consultation paper by Fall of 2017 which would address “Tax Fairness for the Middle Class”. The Liberal government came through on their promise with the issuance of a consultation paper on July 18, 2017, which contains numerous proposed tax amendments causing great concern for small business owners.

Please note the items discussed below are proposed amendments only and have not been introduced to legislation at this particular point in time. However, if these proposed amendments were passed as legislation, the intended effective date is January 1, 2018 for most, but some may be retroactive to the announcement date of the consultation paper

A Practical Approach

To assist with providing a practical approach to understanding how these proposed changes may impact a small business owner, we have outlined a case scenario below.  We hope this will help to better illustrate the changes and quantify the impact.

  1. The Smith Family, consisting of Parent A, Parent B and 2 Children (Child 1 and Child 2). They own a small business in Nova Scotia called “OPCO”.  The Smith’s accountant suggested the use of a family trust when the company was first started;
  2. OPCO generates $150,000 of annual taxable income;
  • Parent A is the principal of OPCO;
  1. Parent B is a stay at home parent and is not actively involved in OPCO;
  2. Child 1 is 19, attends university and has no source of income;
  3. Child 2 is 15;
  • Parent A has been offered $1M for the shares of OPCO from an unrelated third party;

Below is an overview of the proposed tax changes along with a practical approach to the impact these changes would have on the above fact set:

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What to do if the Canada Revenue Agency reviews your tax return

Article Source: Canada Revenue Agency: What to do if the Canada Revenue Agency reviews your tax return

August 8, 2017

What is a review of your tax return?

The first thing you should know is a review is not an audit.

If the CRA tells you that your tax return is being reviewed, it is simply to ensure that the amounts you have claimed are reported accurately. It might also be because some documents are required to support your claim. It’s important to respond promptly to the information request or to call the number shown on the letter as soon as possible since there is a time limit involved.

Why is the CRA reviewing your tax return?

The Canadian tax system is based on self-assessment. You don’t usually need to include your documents when you file your tax return.

However, from time to time, the CRA will contact individuals under one of its review programs. This is part of the CRA’s efforts to ensure the integrity of the tax system.

Make sure you give the CRA the requested documents as soon as possible so it can do its review quickly and easily.

 

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How to protect yourself from identity theft

Article Source: Canada Revenue Agency: Protect yourself against fraud

July 26, 2017

  • Never provide personal information through the Internet or by email. The CRA does not ask you to provide personal information by email.
  • Be suspicious if you are ever asked to pay taxes or fees to the CRA on lottery or sweepstakes winnings. You do not have to pay taxes or fees on these types of winnings. These requests are scams.
  • Keep your access codes, user ID, passwords, and PINs secret.
  • Keep your address current with all government departments and agencies.
  • Choose your tax preparer carefully! Make sure you choose someone you trust and check their references. Always review your return, agree with the content before filing, and follow up to make sure you receive your notice of assessment, since it contains important financial and personal information that belongs to you.
  • Before supporting any charity, use the CRA website at www.cra.gc.ca/charities to find out if the charity is registered and get more information on the way it does business.
  • Be careful before you click on links in any email you receive. Some criminals may be using a technique known as phishing to steal your personal information when you click on the link.
  • Caller ID is a useful function. However, the information displayed can be altered by criminals. Never use only the displayed information to confirm the identity of the caller whether it be an individual, a company or a government entity.
  • Protect your social insurance number. Don't use it as a piece of ID and never reveal it to anyone unless you are certain the person asking for it is legally entitled to that information. If an organization asks for your social insurance number, ask if it is legally required to collect it, and if not, offer other forms of ID.
  • Pay attention to your billing cycle and ask about any missing account statements or suspicious transactions.
  • Shred unwanted documents or store them in a secure place. Make sure that documents with your name and SIN are secure.
  • Immediately report lost or stolen credit or debit cards.
  • Carry only the ID you need.
  • Do not write down any passwords or carry them with you.
  • Ask a trusted neighbour to pick up your mail when you are away or ask that a hold be placed on delivery.

Fishing Vessel Safety Regulations - Transport Canada Information Sessions

June 13, 2017

Fish Harvesters across the province will be required to follow new safety regulations coming into effect July 13, 2017.

The new regulations address issues around safety gear requirements, lifesaving equipment, safety procedures, documentation and vessel stability.

Nova Scotia Fisheries Sector Council, Fisheries Safety Association of Nova Scotia and Transport Canada will be hosting information sessions across the South Shore for those interested in learning more.

20170613 094559

Big Congratulations to Dave Rafuse owner of Blended Athletics

Article: Huddle Tenth Wallace McCain Institute Cohort Announced

May 31, 2017

We would like to congratulate Dave Rafuse owner of Blended Athletics for being named to the tenth cohort of the Wallace McCain Institute at the University of New Brunswick Entrepreneurial Leaders Program.  Dave has worked tirelessly to build Blended Athletics into one of the best and most innovative training facilities in the Province of Nova Scotia.  Dave is an excellent example of the entrepreneurial spirit, and not just the future but a current leader in our Province.  Congratulations David!

Tax Deadline for Self-Employed individuals

Article Source: Canada Revenue Agency: Media room - Tax tip: Reminder

May 18, 2017

June 15, 2017 is the deadline for self-employed individuals to file their 2016 income tax and benefit return

If you are self-employed or the spouse or common-law partner of someone who is, the deadline to file your 2016 income tax and benefit return is midnight on June 15, 2017.

The legislated due date for any balance owing is April 30. However, since that date is a Sunday in 2017, the Canada Revenue Agency (CRA) will consider your payment to have been made on time if the CRA receives it, or it is postmarked, no later than midnight on May 1.

In addition to interest, a late-filing penalty may apply to returns received after the June 15 deadline.

Top questions the Canada Revenue Agency gets at tax time

Article Source: Canada Revenue Agency: Top questions the CRA gets at tax time

March 21, 2017

Every year around tax time, Canadians call the Canada Revenue Agency (CRA) with a variety of questions. You can find a number of answers online if you are registered for the CRA’s online services.

The five most asked questions:

1. How do I change my address?

If you’re registered for the CRA’s online services, you can change your address by going to My Account, using the MyCRA and MyBenefits CRA mobile applications, or you can call us at 1-800-959-8281. You can also fill out Form RC325, Address change request, or write a letter and mail or fax it to your tax centre. Your letter must include your signature, social insurance number, new address, and moving date.

2. How do I change my marital status?

You can change your marital status online by selecting "Change my marital status" in My Account, by selecting "Marital status" in the MyCRA mobile app, or by selecting "Update marital status" in the MyBenefits CRA mobile app. You can also contact the CRA by phone, or fill out Form RC65, Marital Status Change, and send it to your tax centre.

3. What is my balance owing or where is my refund?

Find the amount of your balance owing or your refund by logging into My Account or the MyCRA mobile app. If you are getting a refund, the details will include the refund method (direct deposit or mailed cheque), the date it was sent, and the amount. You can also call the Tax Information Phone Service (TIPS) at 1-800-267-6999 to ask about your refund. TIPS is available from mid-February to December 2017.

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Change to the Employment Insurance waiting period

Article Source: Government of Canada Website- News Release Change to the Employment Insurance waiting period

February 24, 2017

NEWS RELEASE: Employment and Social Development Canada

Starting January 1, 2017, the Employment Insurance (EI) waiting period will be shortened from two weeks to one week. This measure is part of the Government of Canada’s robust plan to improve the EI program and help Canada’s middle class and those working hard to join it.

The waiting period acts like the deductible that must be paid for other types of insurance. Shortening the waiting period is expected to ease the financial strain for EI claimants and will put an estimated additional $650 million in the pockets of Canadians annually beginning next year.

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The HUB South Shore listed as one of the best co-working spaces in Canada for 2017

Big congratulations to Matt, Dave and Tim for their success with the The Hub South Shore!

http://www.hubsouthshore.com/

 Article Source: Nomad Capitalist- The best co-working spaces in Canada for 2017 by Marija Kovačević

February 24, 2017

...

Mahone Bay

If you are, by any chance, a fan of world-class sailing and boating then you should visit this little town named for the Mahone Bay and its 365 islands. Don’t be surprised if you hear a lot of German, because it was the main language spoken there for many years.

While tourism has been a foundation of the economy for several decades, in recent years Mahone Bay has focused on a new era of prosperity based on small business, arts & crafts communities and green initiatives. You can always enjoy and relax with their traditional folk art and folk music festivals and there is always a course or workshop available in creative writing, visual arts, dance or drama for creative minds.

The Hub South Shore
This co-working space compliments the charm and vibe of the city, with its cosy chairs, comfy couch areas, wooden floor, high ceilings and funky design. It features a very spacious shared office area, two soundproof phone rooms for video & conference calls where you can get some privacy, a meeting room, stand up work stations, a library, a kitchenette with snacks to keep you powered up and a deck with a sea view for relaxing in between.

The Hub has a very lively and loyal community where you can network and share ideas with like-minded people at their hosted events such as “ Healthy Eating for Busy People”, “The Start Up Life”, “Lightning Talks” and more.

http://www.hubsouthshore.com/

Seven ways your family can save at tax time

Article Source: Canada Revenue Agency: Tax Tips - Seven ways your family can save at tax time

February 14, 2017

Raising a family can be expensive, but there are many benefits, credits, and deductions that can help your family with costs during the year. They could even lower the amount you owe at tax time! However it is important to file on time if you want your credits.

Check out these potential savings:

Canada child benefit (CCB) - The CCB is a tax-free monthly payment made to eligible families to help them with the cost of raising children under the age of 18. The CCB might include the child disability benefit and any related provincial and territorial programs. You could get up to $6,400 annually for each child under the age of 6 and $5,400 annually for each child aged 6-17. 

Child care expenses – Did your kids attend daycare or a child care program in 2016? You or your spouse or common-law partner might be able to claim what you spent on eligible child care in 2016.

Working income tax benefit – If you are a working family or individual with a low income, you might be eligible for this refundable tax credit intended to provide tax relief to low-income Canadian workers. Eligible individuals and families may be able to apply for advance payments.

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Buying or selling a home? What you should know...

Article Source: Canada Revenue Agency: Buying or selling a home? What you should know.

February 3, 2017

If you bought your home in 2016 or plan to buy a home, the Canada Revenue Agency (CRA) has information that may help you.

Principal Residence Exemption

Sold your principal residence in 2016? File a tax return and claim the principal residence exemption for capital gains.

Starting with sales in the 2016 tax year, you are required to report basic information (date of acquisition, proceeds of disposition (e.g. sale) and address) on your income tax and benefit return when you sell your home to claim the full principal residence exemption. You do not have to pay tax on any capital gain when you sell your home if it was your principal residence for all the years you owned it and did not use any part of it to earn income. A property may qualify as your principal residence for any year that you or certain family members lived in it, if none of you designated another property as a principal residence for that year.

Home buyers’ amount

If you are a first-time home buyer, you may be able to claim $5,000 for the purchase of a qualifying home in 2016.

You qualify for the home buyers’ amount if you did not live in another home owned by you or your spouse or common-law partner that year or in any of the four preceding years.

A qualifying home must be located in Canada and registered in your name and/or your spouse’s or common-law partner’s name according to the applicable land registration system. It includes existing homes, such as single-family houses, semi-detached houses, townhouses, mobile homes, condominium units, apartments in duplexes, triplexes, fourplexes, or apartment buildings, as well as homes under construction.

You do not have to be a first-time home buyer if:

you are eligible for the disability tax credit; or you acquired the home for the benefit of a related person who is eligible for the disability tax credit.

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STUDENTS SAVE WITH "EXTRA CREDITS" THIS TERM

Article Source: Canada Revenue Agency: Students save with "extra credits" this term

February 1, 2017

The Canada Revenue Agency (CRA) is helping you keep more money in your pocket with tax credits, deductions, and benefits for you when you do your taxes. Even if you have little or no income, you should still file your income tax and benefit return to claim tax credits and get benefits and credits.

Here are nine of your top tax-time savings and potential benefits and credits. Remember you need to file on time if you want your credits!

1. Eligible tuition fees – You may be able to claim the tuition fees paid to attend certain post-secondary educational institutions for the tax year in question.

2. Education amount – As a full-time student (or a part-time student, who has a certified mental or physical impairment or who is eligible for the disability tax credit), you can claim $400 for each month you were enrolled in a qualified education program in a designated educational institution. As a part-time student, you may be able to claim $120 for each month you were enrolled.

3. Textbook amount – Claim this amount only if you are entitled to claim the education amount. $65 for each month you qualify for the full-time education amount$20 for each month you qualify for the part-time education amount

4. Interest paid on your student loans – You may be able to claim an amount for the interest paid in 2016 on your student loan for post-secondary education after you complete your education. You can also claim interest paid over the prior five years if you haven't already claimed it. It must be interest paid on a loan received under the Canada Student Loans Act, the Canada Student Financial Assistance Act, the Canada Apprentice Loans Act, or a similar provincial or territorial law.

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Locations:

Halifax

Suite 204, 620 Nine Mile Drive, Bedford, NS

Chester

4171 Highway 3, Chester NS

Bridgewater

11 Dominion Street, Bridgewater NS

Liverpool

7B Henry Hensey Dr., Liverpool NS

Shelburne

167 Water Street, Shelburne NS

Barrington Passage

3289 Highway 3, Barrington Passage NS