Tax Tips: Third Quarter 2021

We provide tax tips on available benefits, CRA policies, and more.

3RD QUARTER 2021 TAX TIPS

Overview

CRA Collections: Potential Impact on Business

• A recent court case demonstrates CRA’s power to collect tax arrears and the impact of CRA.

Travel Allowances: Limited Distance Covered

• CRA commented on whether a travel allowance paid to employees on a per kilometer basis, but only up to a limited number of kilometers, could be a non-taxable allowance.

Covid-19 Medical Expenses: Tax Treatment

• Medical expenses eligible for a personal tax credit are limited to those specifically provided for by the Income Tax Act.

TFSA: Excess Contributions

• Individuals who contribute excess amounts into their TFSA are subject to a penalty tax of 1%/month on the excess amount for each month that the TFSA is overcontributed.

Will and Beneficiary Designations: Are they current?

• Ensure to review wills and beneficiary designations when major life events or changes in the family occur.

CRA or Scammer: Who is it?

• CRA released a Tax Tip which discussed why a taxpayer might be contacted by CRA, when to be suspicious, and how to report potential scams.