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Construction Industry Contract Reporting

Karen — Fri, 08 Oct 2010 02:02:47 +0000

TAX TIP!

Payments made to subcontractors for construction services must be reported to the Canada Revenue Agency.

Should you report?

You need to report if you are an individual, partnership, trust, or corporation which earns more 50% or more of your business income through construction activities.

What to report?

Payments totaling $500 or more (including GST/HST) per reporting period made to subcontractors for construction services or for mixed goods and services if there is a service component of $500 or more. Goods-only payments do not have to be reported.

When to report?

Businesses can report payments on either a calendar- or fiscal-year basis. You must file the return within six months after the end of the reporting period to which it pertains.

How to report?

Contractors can report payments made to subcontractors by completing the T5018 Information Return, which includes the T5018, Statement of Contract Payments, and the T5018SUM, Summary of Contracts Payments.

For more information on the Contract Payment Reporting System, go to: www.cra-arc.gc.ca/tx/bsnss/cntrct/menu-eng.html

Energy Relief to Northern Industry and Families

Karen — Fri, 01 Oct 2010 22:27:41 +0000

The McGuinty Government announces it is providing Energy Relief to Northern Industry and Families. Ontario is providing the most support to northern Ontario on record with energy rebates to northern families and industry to help reduce electricity prices and boost economic activity.

The new Northern Industrial Electricity Rate Program is providing industry electricity price rebates of two cents per kilowatt-hour, averaging a total of $150 million per year for three years. Through the program, qualifying large industrial facilities can reduce electricity costs by up to 25 per cent, based on 2009 levels.

Low- to-middle income northern Ontario residents will also receive help for their home energy costs through the new Northern Ontario Energy Credit. This credit will provide up to $200 per family and up to $130 for single people – totalling about $35 million. It will be available to a quarter of a million families and single people, which is more than half of all northerners.

Finance Minister Dwight Duncan was in Sudbury with MPP Rick Bartolucci to highlight these and other initiatives which are part of the five-year Open Ontario plan to help northern Ontario attract new investments, boost economic growth and enhance job creation.

QUICK FACTS

The 2010 Ontario Budget alone allocated a total of $200 million this year to programs that support the people, businesses and industries of the North that were hard-hit by the global recession.
The Northern Ontario Energy Credit will provide up to $130 for single people age 18 and older and up to $200 for families, including single parents, annually. The credit will also be available to northern residents who live on-reserve and pay energy costs for their primary residence.
The Ring of Fire is an area in the North which contains one of the largest chromite deposits in the World – a key ingredient in stainless steel and an economic opportunity for northern communities. Ontario will invest $2 million annually over three years for skills training related to community-based land use planning for the Ring of Fire area.
Ontario leads Canada in the production of non-fuel minerals. Thirty two mines, out of the 39 operating mines, are located in northern Ontario.
The government is investing $1.2 billion in infrastructure throughout northern Ontario.

Canada cracks down on unreported offshore account holders

Karen — Fri, 01 Oct 2010 22:26:26 +0000

The Honourable Keith Ashfield, Minister of National Revenue, Minister of the Atlantic Canada Opportunities Agency and Minister for the Atlantic Gateway, today announced that the Canada Revenue Agency (CRA) has recently received information from the government of France about HSBC account holders.

Since receiving the information, the CRA has continued to analyze account data to ensure that the Canadian holders are declaring all their income for tax purposes. The CRA has begun a series of audits.

“This is just another example of how our government is taking action to crack down on people who unfairly exploit offshore accounts,” said Minister Ashfield. “We know that most Canadians pay their taxes and play by the rules. That’s why we are taking aggressive action to recover money owed to Canadians.”

The CRA can confirm that over 1,000 bank accounts are linked to Canadian taxpayers. The largest accounts are now being audited, and others will follow. All accounts that are linked to Canadian taxpayers will be reviewed.

Through communication with international partners, the CRA continues to benefit from the increased flow of information under its tax treaties. In this regard, the CRA collaborates extensively with the Organisation for Economic Co?operation and Development, the Seven-Country Working Group on Tax Havens, and the Joint International Tax Shelter Information Centre.

Last year, the CRA uncovered over $1 billion in unpaid federal tax from Canadian taxpayers hiding assets and accounts offshore or through other international transactions. For the same period, the CRA identified another $138 million in unpaid tax through the CRA’s voluntary disclosure program. Just five months into this fiscal year, the number of last year’s disclosures has already been surpassed.

Those Canadians who have undeclared income in foreign jurisdictions can make a voluntary disclosure and pay only taxes owing plus interest. The CRA’s Voluntary Disclosures Program (VDP) allows taxpayers to come forward and correct their tax information.

Not reporting income from foreign sources is illegal. Tax recovery continues to grow as a result of the CRA’s international efforts and audit processes. The CRA is committed to continuing collaborative work to protect Canada’s tax base.

Tax relief available to Canadians affected by Hurricane Igor

Karen — Fri, 01 Oct 2010 22:23:06 +0000

The Honourable Keith Ashfield, Minister of National Revenue, Minister of the Atlantic Canada Opportunities Agency and Minister for the Atlantic Gateway, stated today that the Canada Revenue Agency’s (CRA) tax relief measures are available to taxpayers affected by Hurricane Igor in Newfoundland and Labrador.

“The CRA is sensitive to the fact that some individuals and businesses in Newfoundland and Labrador may encounter financial difficulties as a result of Hurricane Igor,” said Minister Ashfield. “We know that people are primarily concerned with protecting their homes and communities from damage, and as a result may not be able to immediately attend to tax obligations they may have. I would like to take this opportunity to remind those affected that the CRA has taxpayer relief provisions in place for this type of situation.”

Any affected individual or business unable to meet their tax obligations because of Hurricane Igor should contact the CRA to apply for taxpayer relief. Requests are considered by the CRA on a case-by-case basis. Taxpayers can make a taxpayer relief request by completing Form RC4288 Request for Taxpayer Relief, or by writing to their local CRA office. They will need to provide specific information to support their request.

Affected individuals who have any questions or concerns regarding these measures should contact the CRA at 1-800-959-8281. Businesses and self-employed individuals should call 1-800-959-5525.

Cutting-Edge Equipment For Ontario Colleges

Karen — Fri, 01 Oct 2010 22:22:00 +0000

Students at Ontario colleges are using the latest technology and equipment to train for tomorrow’s high skill jobs thanks to the McGuinty government. The province is investing in upgrading learning resources at its 24 colleges. This ensures students will graduate with the up-to-date skills employers are looking for.

Premier Dalton McGuinty toured the state-of-the art music production lab at Algonquin College today. Students in the Music Industry Arts program have the chance to work with high-tech recording equipment because of equipment enhancements at the college.

Ontario is investing a total of $4.2 million for improvements at Algonquin College including upgrading computers for the Animation, Game Development and Journalism labs and acquiring a computer-controlled patient — Sim Man — for the school’s enhanced health care programs.

Investing in postsecondary education is a key part of the five-year Open Ontario Plan to build a skilled and educated workforce. This will give Ontario a competitive edge in the job market and create a strong economy.

QUICK FACTS

Ontario’s 24 colleges will receive $10 million this year to update resources and equipment as part of the three-year $60-million investment from the College Equipment Renewal Fund (CERF).
Ontario is providing Algonquin College with $698,400 this year through CERF — for a total investment of $4.2 million over three years.
The government’s Open Ontario Plan will raise the number of Ontarians with a postsecondary education and training credential to 70 per cent.

Ontario Moves To Provide Tax Relief To Seniors

Karen — Fri, 01 Oct 2010 22:18:32 +0000

The McGuinty Government is proposing to boost tax relief for Ontario seniors to help with energy costs and property taxes.

By increasing the amount seniors can earn and still be eligible for the proposed Ontario Energy and Property Tax Credit, more Ontario seniors would benefit. Over 740,000 Ontario seniors would see an increase in tax relief.

Under the Ontario Energy and Property Tax Credit, Ontarians who own or rent a home could receive up to $900 in tax relief, with seniors able to claim up to $1,025 in tax relief.

This is the latest tax relief in the Open Ontario Plan. Income tax cuts that came into effect in January 2010 have lowered income taxes for 93 per cent of Ontario income tax payers. Those getting a tax cut will save an average of $200 per year.

Earlier this month, the government proposed the Children’s Activity Tax Credit to help families keep their kids active. And a new Northern Ontario Energy Credit will help eligible Northerners manage their energy costs.

QUICK FACTS

With this proposed enhancement, 50,000 more seniors would be eligible for the credit and another 690,000 seniors would receive a higher amount.
Ontarians would be able to apply for the Ontario Energy and Property Tax Credit starting with their 2010 tax returns and, for 2010, would receive the tax credit after they file their tax returns.
For subsequent years, the tax credit would be paid quarterly, like the new Ontario Sales Tax Credit.
Overall, the proposed Ontario Energy and Property Tax Credit would provide $525 million more than the property tax credit relief provided in 2009, for a total of about $1.3 billion annually to 2.8 million Ontarians.

New filing requirements for partnerships

Karen — Fri, 01 Oct 2010 22:16:59 +0000

Ottawa, Ontario, September 17, 2010… The Canada Revenue Agency (CRA) today announced changes to the requirements for filing partnership information returns.

Starting in 2011, the requirement related to the number of partners in a partnership will be replaced with a new requirement based on financial activity. Also, the requirement to file based on the types of partners will be revised. The new requirements apply to all partnerships for fiscal periods ending in 2011 and later. These changes will allow the CRA to focus on the complexity and magnitude of partnership activities. Partnerships that have simple structures and modest financial activity will no longer be required to file a partnership return.

In 1989, a regulation was added to the Canadian Income Tax Regulations requiring all partnerships to file an annual information return. Under certain conditions, the CRA has exempted partnerships with fewer than six partners from filing. However, over the last 20 years, the Canadian economy and business landscape have evolved, showing that business activity and assets held by a partnership, as well as the complexity of a partnership’s structure, are more significant for tax matters than the number of partners.

Along with the changes to the filing requirements, the CRA will introduce a revised information return and tax guide for partnerships in 2011.

For more information, go to www.cra.gc.ca/partnership, where information will be updated over the next several months.

Interest Rates

Karen — Fri, 01 Oct 2010 22:14:24 +0000

The Ontario Ministry of Revenue today announced the interest rates that will apply to any amounts you owe to the ministry and to any amounts the ministry owes to individuals and corporations. By law, we reset the interest rates every three months.

Interest rates for October 1, 2010 to December 31, 2010

6% on taxes you owe to the ministry
0% on taxes you overpaid
3% on taxes or refunds you are eligible for as a result of a successful appeal or objection
3% on late International Fuel Tax Agreement payments
3% on International Fuel Tax Agreement refunds the ministry has not paid you within 90 days

For more information visit:

www.rev.gov.on.ca/en/rates/interest

Canada Revenue Agency Contact Information

Karen — Wed, 28 Jul 2010 02:34:04 +0000

Do you have any questions about personal income taxes, business registration and taxes, child and family benefits, payment arrangements, and so on? You can call Canada Revenue Agency at the following numbers:

TIPS (Tax Information Phone Service) 1-800-267-6999

This automated phone service provides information to individuals and businesses.

Individual income tax enquiries 1-800-959-8281

Tax information for individuals, including personal income tax returns, instalments, RRSPs, and the Working Income Tax Benefit.

Telerefund 1-800-959-1956

This automated phone service provides information about your income tax refund.

Businesses and self-employed individuals 1-800-959-5525

Business and GST/HST registration, payroll, GST/HST(including rebates such as the new housing rebates), excise taxes and other levies, excise duties, corporations, sole proprietorships and partnerships.

Universal Child Care Benefit, Canada Child Tax Benefit 1-800-387-1193

UCCB, CCTB and related provincial and territorial programs, child disability benefit and children’s special allowances.

GST/HST credit for Individuals 1-800-959-1953

GST/HST credit and related provincial and territorial programs.

Forms and publications 1-800-959-2221

Order publications online or download from the CRA site. You can also use the toll free number to order.

International Tax Services Office

Individuals 1-800-267-5177

Non-resident corporations 1-800-561-7761 Ext.9144

Non-resident trusts 1-800-561-7761 Ext. 9155

Part XIII tax and Non-resident withholding accounts 1-800-267-3395

Payment arrangements(income tax) 1-888-863-8657

Discuss income tax payment arrangements with an agent.

Payment arrangements 1-866-864-5823

To discuss payment arrangements for debts owing to Human Resources and Skills Development Canada, such as defaulted Canada Student loans, Employment Insurance overpayments, Employment Programs overpayments and Canada Pension Plan overpayments.

TTY (Teletypewriter) 1-800-665-0354

For enquiries from persons who are deaf or hard of hearing, or who have a speech impairment.

Charities Client Assistance 1-800-267-2384

Get information about registered charities.

For more information, please go to Canada Revenue Agency/contact

Rules for gifts and awards

Karen — Mon, 26 Jul 2010 00:24:44 +0000

Did you know that a gift or award that you give an employee is a taxable benefit from employment, whether it is cash, near cash, or non cash. A near cash item is one that can be easily converted to cash such as a gift certificate, gift card, gold nuggets, securities, or stocks.

Cash and near cash gifts or awards are always a taxable benefit to the employee. Non cash gifts or non cash awards, on the other hand, may not be considered a taxable benefit under certain circumstances.

A gift has to be for a special occasion such as a religious holiday, a birthday, a wedding, or the birth of a child.

An award has to be for an employment-related accomplishment such as long or outstanding service, employees’ suggestions, or meeting or exceeding safety standards. An award cannot be performance-related.

If you give your employee a non-cash gift or award for any other reason, this policy does not apply and you have to include the fair market value of the gift or award in the employee’s income. As well, certain kinds of gifts and awards are not eligible, such as cash. For more information, go to Gifts and awards outside this policy.

If you give an item that is the result of a prize draw, or is given by or through your company’s social committee, go to Gifts and awards given through prize draws and social committees.

The gifts and awards policy does not apply to non-arm’s length employees, such as your relatives, shareholders, or people related to them.

Payroll deductions

Where the benefit is taxable, it is also pensionable. Deduct CPP contributions and income tax.

If the taxable benefit is paid in cash, it is insurable— deduct EI premiums. If it is a non-cash benefit, it is not insurable—do not deduct EI premiums. For EI purposes only, near-cash taxable benefits are treated the same as non-cash taxable benefits. Therefore, they are not insurable. Do not deduct EI premiums.

Reporting the benefit

Include the taxable gift, award or social event on a T4 slip in box 14, “Employment income” and in the “Other information” area under code 40 at the bottom of the employee’s slip. For more information, see T4 – Information for employers.

Examples

To see how this policy works, go to Example for 2010 and later years.

For more information, please go to Canada Revenue Agency website.