| Q: |
Carbon Tax Dividend versus Carbon Tax Rebate. What is the difference? |
| A: |
The British Columbia government introduced in their Feburary 2008 budget a new 'neutral' tax referred to as the carbon tax. The focus will be on collecting tax on transactions that involve the production of carbon in the environment and then reduce other taxes for persons and corporations. The main impact on residents of British Columbia will be the payrment of a Carbon Tax Dividend and a Carbon Tax Rebate.
The Carbon Tax Rebate is provided to support low income individuals and families and will be paid each quarter at the same pattern as the GST rebate. It will be calculated based on a similiar criteria as the GST rebate providing $100 for each adult and $30 for each eligible child and this will done each quarter.
Starting in late June 2008, theCarbon Tax Dividend will be mailed automatically to every eligible adult who has filed either a 2006 or 2007 personal income tax return for British Columbia. Parents who receive the Canada Child Tax Benefit will also receive a $100 payment for each child.
Once the tax return is assessed, the dividend will be mailed automatically to the mailing address provided on the tax return.
Even if you or your spouse have little or no income to declare, the sooner each of you file your individual tax returns, the sooner you will each receive your one-time $100 dividend.
While the easiest and quickest way to receive the dividend payment is to file a 2006 or 2007 BC income tax return, there is also an option to file an application through the Ministry of Small Business and Revenue. This link will take you the application form.
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| Q: |
I'm in the process of moving to Argentina. I am selling my home and moving to Argentina to work 10 April. I currently work for a Canadian Company and will be working for an Argentine company starting in May. Will I need to file a tax return for the current year? Will there be any other taxes or matter that need my attention? |
| A: |
Emigranting from Canada to any foreign country to work raises a number of issues that need to be considered. Each situation is unique and should be discussed with an accountant. In this particular situation a personal income tax return would be required to be filed to report world income for the period 01 Jan to date of departure 10 April. Any income earned in Canada would be reported based on a residency test. CRA has an extensive discussion on that point on their website. Once residency issue has been settled, then the required and type of return to be filed for all taxation periods after 10 April can be determined. It should be noted that on departure from Canada your are deemed to depose of all assets, investments, and other holdings. Special treatment and rules exist for RRSP, RESP, RDSP, and other related tax deferral programs. Also the existence of a tax treaty between Canada and the country you are moving to should be reviewed for any impact it might have on income reporting requirements. There is no simple answer for this situation and a professional accountant should be consulted. |
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| Q: |
What is a RDSP (Registered Disability Savings Plan)? |
| A: |
An RDSP is a proposed federal government program which is designed for the support of the disabled individual. It provides for contributions from both the government and the families of those impacted by disabilities. If you are eligible for a Disability Tax Credit and have a Social Insurance Number (SIN) then a RDSP can be established for the disabled individual. Maximum contributions to the plan is $200,000 lifetime. The government does plan to contribute in a fashion similiar to the Registered Education Savings Plan to a maximum of $70,000 lifetime. For more information on your specific situation please contact Blackfish Accounting. |
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| Q: |
Why is your company named Blackfish? |
| A: |
Blackfish is the old name used by both fisherman and natives for the killer whale/orca. Also Mark Kennedy last posting with the military was as the commanding officer of 12 Service Battalion. The unit crest for 12 Service Battalion contains an orca. The orca also indicates a west coast affiliation. |
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| Q: |
I have a vacation/rental property and a primary house. Can I sell my primary residence and call the vacation property my principal residence? |
| A: |
In most situations, Yes. There are several rules including how often you make this declaration of a principal residence. There are a number of pitfalls that you’ll need to be aware of. Blackfish can assist you in navigating these pitfalls. |
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| Q: |
Can I deduct the Medical Services Plan (MSP) payments as medical expenses on my personal tax return. |
| A: |
Unfortunately not. MSP payments or any payments to government plans are not deductible. Private health care plans and other medical expenses are deductible however the list is constantly changing. |
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| Q: |
I operate my business out of my house. Can I deduct all or a portion of the expenses of the house. |
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Yes. A portion of the household expenses such as mortgage interest, heat, light, and associated telephone may be deducted from business income. For a complete list of deductions that suit your situation, contact Blackfish Accounting. |
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| Q: |
My notice of assessment from revenue Canada indicates that I have net capital losses from other years. Can I use these to reduce my income tax next year? |
| A: |
Possibly. If you have any capital gains then we can use the losses from previous years to offset this gain and reduce or eliminate the tax on the capital gain. Capital losses however, can only be used to offset capital gains not regular income. If you have capital losses being carried forward it may be a good time to dispose of a capital item like stocks and bonds and reduce the tax on them. |
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| Q: |
What makes a Certified Management Account (CMA) different? |
| A: |
All accountants are trained in the facets of general accounting. CMAs, in addition to this training, receive specialized training in management accounting and learn how to integrate all areas of business, from financial management to marketing. This specialized training benefits all clients, especially those that also own and operate businesses. |
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| Q: |
I’m a non-resident. Why is so much of the proceeds from the sale of my Canadian property being withheld? |
| A: |
The Canadian government takes the position that you acquired the property at zero value. You are required to obtain a “clearance certificate” prior to completion of the sale to minimize the amount of tax that must be remitted to the Receiver General. The amount of tax can be further reduced by the filing of a non-resident personal income tax return. |
