Archive
New Ontario legislation allows realtors to incorporate Personal Real Estate Corporations (PREC)
Leave a CommentOn March 4, 2020 Bill 145 of the Trust in Real Estate Services Act received royal assent. With the passage of Bill 145 of the Legislative Assembly of Ontario, Ontario real estate salespersons and brokers are now permitted to incorporate in Ontario.
Supporting regulations are not yet finalized. Future regulations will outline the conditions and restrictions under which this might take place. Once in force, these regulations will provide great opportunities for Ontario real estate salespersons and brokers to incorporate by setting up a Personal Real Estate Corporation (PREC).
The biggest advantage that real estate professionals can expect from incorporation in Ontario is a tax deferral opportunity. In Ontario, the corporate small business tax rate in 2020 is 12.2% (on the first $500,000). When you compare this rate to the 50%+ rate for earners in the top personal tax bracket, there is a deferral of tax.
If you would like our assistance in deciding whether you would benefit from incorporating your real estate practice, be sure to contact us!
CRA Personal Tax Deadline Announcement
Leave a CommentThe deadline for most individuals to file their 2019 taxes has been extended to June 1, 2020. The deadline to pay amounts owed has also been extended to September 1, 2020. Penalties and interest will not be charged if payments are made by the extended deadlines of September 1, 2020. This includes the late-filing penalty as long as the return is filed by September 1, 2020.
If you, your spouse, or your common-law partner are self-employed, you still have until June 15, 2020, to file your taxes. However, your payment deadline has also been extended to September 1, 2020.
For those who have to pay by instalments, the June 15, 2020, payment due date has also been extended to September 1st. Instalment penalties and interest will not be charged for this payment if it is made by the extended deadline of September 1, 2020.
Click here to read more.
Canada Emergency Business Account- Expansion of support for workers and small businesses
Leave a CommentThe Prime Minister, Justin Trudeau, today announced an expansion to the eligibility criteria for the Canada Emergency Business Account (CEBA) to include many owner-operated small businesses. This extended measure will help small businesses protect the jobs that Canadians rely on.
The changes to the CEBA will allow more Canadian small businesses to access interest free loans that will help cover operating costs during a period when revenues have been reduced, due to the pandemic.
The program will now be available to a greater number of businesses that are sole proprietors receiving income directly from their businesses, businesses that rely on contractors, and family-owned corporations that pay employees through dividends rather than payroll.
To read more click here.
Canadian Emergency Wage Subsidy- Extending eligibility
Leave a CommentThe government introduced the Canada Emergency Wage Subsidy (CEWS) to prevent further job losses, encourage employers to rehire workers previously laid off as a result of COVID-19, and help better position Canadian companies and other employers to more easily resume normal operations following the crisis.
Finance Minister Bill Morneau today announced that the Government of Canada will extend the CEWS by an additional 12 weeks to August 29, 2020. Extending the program will give workers greater confidence that they will continue to get the support they need during these difficult times. The Government will consult with key business and labour representatives over the next month on potential adjustments to the program to incent jobs and growth, including the 30 per cent revenue decline threshold. Any potential changes following the consultation will have as key objectives to maximize employment, ensure the CEWS reflects the immediate needs of businesses, and support the post-crisis economic recovery.
To read more click here.
Canada Emergency Student Benefit (CESB)
Leave a CommentThe Canada Emergency Student Benefit (CESB) provides emergency financial relief to students and recent graduates who are unable to work, or unable to find work, due to reasons related to COVID-19. It is also available for those who are working but not making more than $1,000 (before taxes) over the four-week period for which they are applying.
This benefit provides $1,250 per month for eligible students or $2,000 per month for eligible students with dependents or disabilities.
This benefit will be available from May to August 2020. There are four eligibility periods. The first is from May 10 to June 6, 2020.
To read about the benefit and whether you are eligible, please click here.
Applications open May 15, 2020. You can apply through your CRA My Account or you can call 1-800-959-2019 or 1-800-959-2041.
To find out more about how to apply, please click here.
Strict compliance of the CEWS eligibility
Leave a CommentAs of April 27, 2020, online applications have opened for the Canada Emergency Wage Subsidy (CEWS). The CEWS provides a 75% wage subsidy to eligible employers for up to 12 weeks and is retroactive to March 15, 2020. The subsidy will be available at a rate of 75% of weekly remuneration paid to a maximum of $847 per employee. Your business must have experienced a drop of at least 15% of revenue in March 2020 and 30% for April 2020 and/or May 2020 to qualify for this subsidy.
The Federal Government has implemented severe penalties if a business is found not to have met to the CEWS eligibility requirements after receiving the subsidy. Audits will be conducted by the Canada Revenue Agency to verify the amounts related to the subsidy including revenue and salary calculations. If a business is not compliant with the rules, the consequences can include:
- repayment of amounts received
- significant fines of up to 25% of the CEWS received (and up to an additional 200% in the case of fraudulent claims)
- penalties for up to five years in prison for individuals who submitted fraudulent claims
Furthermore, the individuals who have the principal responsibility for the financial activities must attest that the application is complete and accurate. As such, the individual(s) that make the attestation can be held personally responsible for the application that is filed and will also be subject to penalties for incorrect and/or fraudulent claims.
The CRA intends to publish the name of any eligible employer that makes an application for the wage subsidy and share information with government officials for the purposes of administration and enforcement of the Canada Emergency Benefit Act.
Applications for the wage subsidy will be open until October 2020. Once applications are submitted, it appears that there will not be a chance to make corrections. If you need more time to be sure whether you qualify for the subsidy before you submit an application, it is recommended you take the time required to properly determine your eligibility before applying.
We are here to help you navigate the CEWS application process. If you have questions relating to your application, or an existing application, please do not hesitate to reach out.
Click here to learn how to apply.
Canada Emergency Commercial Rent Assistance
Leave a CommentToday, Prime Minister Justin Trudeau announced that the federal government has reached an agreement in principle with all provinces and territories to implement the Canada Emergency Commercial Rent Assistance (CECRA) for small businesses. This program will lower rent by 75 per cent for small businesses that have been affected by COVID-19.
The government is also providing further details on the program:
- The program will provide forgivable loans to qualifying commercial property owners to cover 50 per cent of three monthly rent payments that are payable by eligible small business tenants who are experiencing financial hardship during April, May, and June.
- The loans will be forgiven if the mortgaged property owner agrees to reduce the eligible small business tenant’s rent by at least 75 per cent for the three corresponding months under a rent forgiveness agreement, which will include a term not to evict the tenant while the agreement is in place. The small business tenant would cover the remainder, up to 25 per cent of the rent.
- Impacted small business tenants are businesses paying less than $50,000 per month in rent and who have temporarily ceased operations or have experienced at least a 70 per cent drop in pre-COVID-19 revenues. This support will also be available to non-profit and charitable organizations.
Under a rent forgiveness agreement, which includes a moratorium on eviction, the mortgaged commercial property owner would reduce the small business tenant’s monthly rent by at least 75 per cent. The tenant would be responsible for covering 25 per cent, the property owner 25 per cent, while the federal government and provinces would share the remaining 50 per cent. The forgivable loans would be disbursed directly to the mortgage lender.
Click here to read more.
Canada Emergency Wage Subsidy- Application Information
Leave a CommentNew! Applications for the CEWS will be open on April 27.
Be ready to apply for the CEWS. Please read the new information and consider using CRA’s calculator spreadsheet.
Click here to read more about the Canada Emergency Wage Subsidy.
Update to the Canada Emergency Business Account
Leave a CommentCanada Emergency Wage Subsidy- Update
Leave a Comment- To measure their revenue loss, it is proposed that employers compare their revenue of March, April and May 2020 to that of the same month of 2019 or, in order to provide added flexibility, to an average of their revenue earned in January and February 2020.
- For March, the government proposes to make the CEWS more accessible than originally announced by reducing this 30% benchmark to 15%, in recognition of the fact that many businesses did not begin to be affected by the crisis until partway through the month.
- To provide certainty for employers, the government is also proposing that once an employer is found eligible for a specific period, they would automatically qualify for the next period of the program. For example, an employer with a revenue drop of more than 15% in March would qualify for the first and second periods of the program, covering remuneration paid between March 15 and May 9. Similarly, an employer with a revenue drop of 30% in April would qualify for the second and third periods of the program, covering remuneration paid between May 10 to June 6.
- To recognize the challenges in measuring revenues of non-profit organizations and registered charities, it is proposed that they be allowed to choose whether or not to include government assistance in revenues for the purpose of applying the revenue decline test. Once chosen, the same approach would have to be maintained by the organization throughout the program period.
- It is also proposed that employers be allowed to measure revenues either on the basis of accrual accounting (as they are earned) or cash accounting (as they are received). Once chosen, the same accounting method would have to be used by the employer throughout the program period.
- It is also proposed that the CEWS provide an additional amount to compensate employers for their contributions to the Canada Pension Plan, Employment Insurance, Quebec Pension Plan and Quebec Parental Insurance Plan paid in respect of eligible employees who are on leave with pay due to COVID-19.
- The employer would be required to repay amounts paid under the CEWS if they do not meet the eligibility requirements.
- The government is also proposing a penalty of 25% of the CEWS received by an employer if the employer has engaged in transactions that artificially reduce the employer’s revenue in order to qualify for the subsidy.
- As well, under existing provisions of the Income Tax Act, persons making, or participating in making, a false or deceptive statement could be prosecuted with a summary or indictable offence. Anyone found guilty could be sentenced to prison for up to 5 years.
