As a result, IFRS and ASPE will become Canadian GAAP. The move to IFRS from current Canadian GAAP could affect the measurement and reporting of income taxes for financial statement purposes and the calculation of Canadian taxes payable. See our Tax Memos:
“The Move to IFRS: CRA Guidance”; “The Move to IFRS: Tax Implications”; and
“Not Just Another Accounting Exercise: Managing Change for the Tax Function.”
Environmental incentives – Be aware of federal and provincial environmental incentives that can help your company go green and save money. See our “Going Green Tables (2009/2010)” and our podcast, “Going Green Incentives.”
Provincial tax incentives – Benefit from provincial tax incentives and enhancements to these incentives. For example, determine whether your company qualifies for:
Manufacturing and processing (M&P) tax credits
Nova Scotia’s new 10% credit for eligible M&P property acquired after 2009 that costs more than $50,000 (maximum annual credit is $1 million); and Quebec’s revised credit rates for investments made in certain regions, generally after December 10, 2009. A cumulative limit of $75 million of eligible investments made after October 28, 2009, qualifies for this credit at rates above 5%, and/or refundability.
Media tax incentives – enhanced or extended in British Columbia, Manitoba, New Brunswick, Ontario and Quebec.
Income deferral – Defer the receipt of certain employment income if your marginal personal tax rate will be lower in 2011 than in 2010.
Job-related courses – Ask your employer to pay for job- related courses directly rather than paying you additional remuneration.
Scholarship programs –
Ask your employer to set up a program that provides non-taxable scholarships for post-secondary education that may benefit your and other employees’ children. Funds allocated by your employer to a discretionary bonus pool could instead be used to fund this program.
Be aware that, under the CRA’s administrative policy, elementary and secondary education scholarships, bursaries and tuition fees provided by employers to their employees’ family members are taxable to the
SR&ED tax credits – available in all provinces (except Prince Edward Island) and the Yukon. Enhancements: make the 20% credit in Manitoba:
fully refundable for eligible expenditures incurred in Manitoba after 2009 under a contract with a qualifying research institute for new technologies and biotechnologies; and
partially refundable for in-house R&D expenditures after 2010 (25% in 2011 and 50% after 2011); and
affect clinical trial work and arm’s length contracting in Quebec.
Manitoba co-op education and apprenticeship tax credit – commencing 2011, employers that hire high school and post-secondary Level 1 and 2 apprentices, but are not eligible for the federal Apprenticeship Job Creation Tax Credit, can claim this 10% tax credit on wages paid to an apprentice (maximum credit is $2,000).
Manitoba small business venture capital tax credit – replaces the Community Enterprise Investment Tax Credit and expires December 31, 2013.
Quebec e-business tax credit – enhancements will enable certain corporations in the information technology sector, in activities transfer and business start-up and personnel leasing activities, to qualify for this 30% refundable tax credit with respect to salaries paid to eligible employees before January 1, 2016.
Quebec book publishing tax credit – changes to this credit allow reprinted books to qualify for this refundable tax credit.
employee. See our Tax Memo “Taxable Employment Benefits – The CRA’s Revised Policy.”
Employee gifts and awards – Ask your employer to provide you with non-cash gifts and/or awards. These will not be taxable to you if you receive non-cash gifts and non- cash awards with a total value to you of $500 or less annually. Exceptions apply. For more information, see our Tax Memo “Taxable Employment Benefits – The CRA’s Revised Policy.”
Employee loans – Ensure that any interest you intend to pay relating to employee loans for 2010 is paid on or before January 30, 2011.
Home office – If you work out of your home, try to arrange your employment terms so that you can deduct certain expenses related to your home office.