• insurance corporations
• non-resident corporations
• corporations reporting in functional currency
• corporations that are exempt from tax payable under section 149 of the Income Tax Act

The penalty for non-compliance with this filing requirement for tax years ending in 2012 is $500. For tax years ending after 2012, the penalty for non-compliance is $1000.

• You or your spouse or common-law partner have not owned a home which you occupied as your principal residence during the four years preceding the withdrawal for the Home Buyer’s Plan, or
• You are buying or building a home for a related disabled person.

The maximum amount that can be borrowed was increased to $25,000 by the Federal 2009 Budget, which also announced a new First-Time Home Buyers’ Tax Credit.

Note that your RRSP contributions must remain in the RRSP for at least 90 days before you can withdraw them under the Home Buyer’s Plan, or the contributions may not be deductible for any year.  In other words, if RRSP contributions are made in the 89-day period just prior to an HBP withdrawal from the RRSP, the value of the RRSP after the HPB withdrawal must be at least equal to those contributions.

Income tax will not be deducted from the amount withdrawn, and the withdrawal amount will not be included in your income.  The funds must be repaid over a maximum of 15 years, starting the second year following the year in which they are withdrawn.  Each year that a repayment is due but not paid, the amount due (1/15th of the amount borrowed) will be included in taxable income.  See the article Make sure you report repayments to RRSP Home Buyer’s Plan! on the Filing Your Return page.

If you buy the home with your spouse, common-law partner, or other individuals, each of you can withdraw up to $25,000.

A qualifying home means:

• A housing unit located in Canada, or
• A share of the capital stock of a cooperative housing corporation, the holder of which is entitled to possession of a housing unit located in Canada

You must buy or build the qualifying home by October 1 of the year after the year of withdrawal.  There are other conditions which must be met in order to qualify for the Home Buyer’s Plan, including your intent to occupy the home as your principal residence no later than one year after building or purchasing it.  Some conditions must be met before applying to withdraw funds and other conditions must be met when a withdrawal is made.  One of the conditions that must be met before applying to withdraw funds is that you have to enter into a written agreement to buy or build a qualifying home.  For more information, see the Canada Revenue Agency (CRA) information on the Home Buyer’s Plan, including conditions for participating in the HBP.

For more information visit Tax Tips

Eligible expenses include:

• Salaries (Including taxable benefits)
• Wages (Including taxable benefits)
• Fees payable to an employment agency

These expenses must be paid for employment or services, as applicable, at a permanent establishment of the corporation in Ontario. The eligible expenses must be directly related to the employee.

The following conditions must  be met to be considered a qualifying work placement (WP) for the (CETC):

• The student performs employment duties for a corporation under a qualifying co-operative education program (QCEP);
• The WP has been developed or approved by an eligible educational institution as a suitable learning situation;
• The terms of the WP require the student to engage in productive work;
• The WP is for a period of at least 10 consecutive weeks or, in the case of an internship program, not less than 8 consecutive months and not more than 16 consecutive months;
• The student is paid for the work performed in the WP;
• The corporation is required to supervise and evaluate the job performance of the student in the WP;
• The institution monitors the student’s performance in the WP; and
• The institution has certified the WP as a qualifying work placement.

To claim the credit you will also need to keep a copy of the letter of certification from the eligible Ontario educational institution containing the name of the student, employer, the institution, the term of the work placement, and the name/discipline of the QCEP to support the claim.

For more information about the CETC and SCHEDULE 550 please visit the CRA website.

The proposal contains a new definition of “tax preparer” for this purpose, which includes a person or partnership that accepts consideration to prepare more than 10 “returns of income” of corporations or more than 10 “returns of income” for individuals (other than trusts) in a calendar year. An employee who prepares these returns in performing their employment duties is not considered a tax preparer for these purposes. These tax preparers must electronically file “any return of income that they prepare for consideration” under proposed subsection 150.1(2.3), although up to 10 corporate returns and 10 individual returns may be filed by other means. Bill C-38 also introduces penalties for non-compliance of $25 for each individual return and $100 for each corporate return that is not e-filed.

Specific e-file exceptions have been proposed. More information on Bill C-38 is available on the Parliament of Canada’s website. All of these amendments come into force on January 1, 2013.

• Computer work,
• Banking,
• Answering the telephone and taking messages,
• Purchasing supplies,
• Delivery and pick-ups, and
• Promotional work.

In rendering government decisions to accept salaries paid to family members easier, numerous aspects should be considered such as:

• Having a written contract of employment between the corporation and a family member,
• Salaries commensurate with duties performed,
• The educational background of family members,
• Not being overly aggressive in paying salaries to family members,
• Keep copies of cancelled cheques, and
• If payment is made in cash to family members, have them sign receipts.

The family members’ salaries would be reported on T4′s (Relevés 1 for Quebec) as they normally would if paid to an unrelated employee.

• Your monthly CPP retirement pension amount will increase by a larger percentage if you take it after age 65 (gradually from 2011 to 2013).
• Your monthly CPP retirement pension amount will decrease by a larger percentage if you take it before age 65 (gradually from 2012 to 2016).
• The number of years of low or zero earnings that are automatically dropped from the CPP retirement pension calculation will increase (2012 and 2014).
• You will be able to start receiving your CPP retirement pension without any work stoppage (starting in 2012).
• Effective January 1st, 2012 if you are under age 65 and you work while receiving your CPP retirement pension, you and your employer must make CPP contributions (or if you work outside of Quebec while receiving a QPP retirement). These contributions will increase your CPP retirement benefits (starting in 2013).
• Effective January 1st, 2012, If you are age 65 to 70 and you work while receiving your CPP retirement pension, you can choose to make CPP contributions (or if you work outside of Quebec while receiving a QPP retirement pension), these contributions will increase your CPP retirement benefits beginning in 2013.

These changes affect you if you are:

• an employee who contributes to the Canada Pension Plan (CPP), whether you are just starting your career or you are planning to retire soon;
• a self-employed person who contributes to the CPP;
• between the ages of 60 and 70 and you work while receiving your CPP retirement pension (or if you work outside of Quebec while receiving a Quebec Pension Plan (QPP) retirement pension); or
• an employer who contributes to the CPP on behalf of your employees.
• You will not be affected by these changes if you started receiving a CPP retirement pension before December 31, 2010, and you remain out of the work force.
• The CPP operates throughout Canada, except in Quebec, where the Quebec Pension Plan (QPP) provides benefits. These changes do not apply to QPP.

These changes were designed to improve retirement flexibility for working individuals in Canada, enhance pension coverage, and improve equity in the CPP.

Typical voluntary disclosures include; domestic business income never reported, failure to collect or remit GST/HST and/or source deductions, information returns not previously submitted, foreign wages and benefits not reported, and domestic and foreign dividends and interest never reported.

Relief is determined on a case by case basis.

If you are audited by the Canada Revenue Agency (CRA) you should consider this. The CRA auditor has access to the Internet. What will show up if the auditor enters your name or your business name in Google or one of the other search engines? Will the auditor discover information about activities that you have failed to report?

A CRA auditor now routinely uses publicly available search engines, Google for example, to discover information about companies and individuals that are being audited. In one recent case, the CRA disallowed a Voluntary Disclosure application because the taxpayer submitted an incomplete disclosure. He failed to provide information about his involvement in certain business activities that showed up during a Web search.

So remember- Everyone is watching you on the Web including Big Brother!

When you are ready to file your return and want to retrieve your access code, go to www.netfile.gc.ca/netfilecode.

Enter the following information to get your access code:

• your social insurance number (SIN);
• your date of birth; and
• the amount you reported on line 150 of your tax return from last year

For more information visit the CRA website.