News Archives - Page 21 of 28

Cash is no longer king, as small businesses who don’t accept cards will learn to their detriment

Small businesses, who have a policy of not accepting credit cards, it’s time to revisit it. According to a recent Square study, 79 percent of Canadians choose to pay with their cards over cash, and 47 percent do not frequent cash-only businesses. In fact, the average Canadian carries $46.50 in cash on them, and only visits the bank every 17 days on average to withdraw cash. All of this means that it’s a risk for Canadian business owners to not accept cards. Just ask Jim McKelvey. He lost a $2,000 sale for a glass faucet because his business didn’t accept a customer’s credit card. But, by adding mobile wallet services such as Apple Pay, a company is being flexible and showing potential customers that they are forward-thinking.

Personal Investor: Missing your tax deadline could get costly

In Canada, your taxes are due on April 30th. This is a hard deadline as far as the Canadian Revenue Agency (CRA) is concerned. Once it clocks over to midnight on May 1st, if you owe money then you’ll start to owe a lot more. You’ll automatically accrue 5 percent interest on your due payment, and it is compounded daily. It gets worse, as another percentage point is added each month up to a maximum of 12 months. After a year passes and if you still haven’t paid the CRA, then 10 percent interest is charged on the balance owing plus 2 percent for each full month, up to 20 months. You could see a small payment of $100 slowly balloon to thousands if you’re not careful.

New mortgage rules sending borrowers to alternative lenders

Mortgage brokers and others, who work with consumers to arrange mortgages, say that rejection rates are on the rise. Major banks and other traditional lenders have tightened their willingness to lend after Canadian banking regulators instituted a new “stress test” that applies to all home buyers. As a result, rejection rates have risen by approximately 20 percent.

The new guidelines, known as B20, have also pushed some buyers to consider private lenders, mortgage investment corporations (MICs) and credit unions, who are provincially regulated and not required to implement the stress test. The changes were implemented to curb risky lending as a consequence of rising household debt and high home prices in some markets.

Tax deadline looms: Which credits have changed?

If you’re rushing to finish your taxes before the deadline, then you’ll want to be aware of some of the tax credit changes in Canada for 2017. One change is that the children’s fitness and arts programs are no longer available. There are also changes to how and when you can claim some of the costs for fertility-related expenses. Previously, it was only for those that had a medical condition, but that’s changed. As of January 1, 2017, the textbook credit has been eliminated. There are also changes to public transit, disability credit and caregivers to name a few.

Tax Season 2018: Here Are All The New Things You Need To Know

Taxes have changed for 2018. Those filing this year will need to watch out for these changes from Ottawa. One of the major changes is that the Canada caregiver credit replaces the caregiver credit, the family caregiver credit and the credit for infirm dependants age 18 or older. Furthermore, having an older parent or grandparent live with you doesn’t automatically qualify you for this credit. Now, they must be infirm for you to claim the credit. Other changes include the elimination of the education and textbook tax credits, the children’s fitness and arts credit, and public transit tax credit up to June 30th. (Anything after July 1st is ineligible.)

Personal Investor: Turn capital loss into tax gain

Despite making some bad investments, your losses may provide some financial benefit to you. Provided, you have some gains from other investments within the last three years, then you can reduce the amount of money you owe tax on by deducting your losses from them. In this way, you can reduce the capital gains tax you’ll need to pay on your returns. This strategy, known as tax-loss selling and is a common practice often deployed at the end of the year to lower a tax bill. There are, however, some stipulations such as that you can’t repurchase the stock you sold at a loss until after 30 days, and it has to be outside an RRSP or a TSFA.

These are the rules of the road when it comes to deducting automobile expenses on your taxes

It’s tax time in Canada, and if you are planning on writing off car expenses, you need to meet certain conditions. To qualify, you need to travel or work remotely, be paying expenses out-of-pocket, and not be receiving a non-taxable vehicle allowance. You’ll also require form T2200 to be signed by your employer. If you meet these four conditions, then you are eligible to receive a deduction for use of your vehicle while you are working.

Rental income is taxable – even for Airbnb

Airbnb recently sent notices to 80,000 Canadian hosts to remind them that sharing their home is considered rental income by Canada Revenue Agency (CRA). This means you’ll need to include money from Airbnb rentals on form T776, which will increase your overall employment income.

While it may be taxed in a high bracket, you can lower the taxable amount by deducting expenses related to the rental. You can claim the full cost of advertising expenses, office costs, professional fees, management fees, salaries or wages, and travel costs. If the property is your principal residence, then you can claim a portion of your mortgage interest, property taxes, insurance, repairs and maintenance, landscaping, utilities, and depreciation on fixed assets like furniture, computers, or even your car. If it isn’t your principal residence, then you can claim depreciation on the property. Remember to keep all your records.

B.C. government exempting vacation homes from speculation tax

As a result of backlash from the B.C. property speculation tax, the government is reducing where the tax applies by focusing on primarily urban centres and exempting rural areas where lakeside cabins and vacation homes are common. It was also announced that the rate of tax will change. Starting in 2019, British Columbians with multiple homes, which are kept empty, will pay 0.5 percent tax on the value of their home. Canadians living outside B.C. will pay 1 percent tax, and non-residents will pay 2 percent. The speculation tax was initiated to deal with the issue of housing affordability for British Columbians, and the focus of the tax was to deter those people who are treating the housing market like a stock market.

Tax scammers out in full force this season

Scammers posing as Canadian Revenue Agents have been contacting people, demanding money and threatening legal action in an attempt to get personal information. It’s important to know that the CRA will only each out to you by certified mail, not by phone. If you are suspicious, contact the CRA directly. You should also be skeptical if they are looking for your personal information or request unusual payment methods, such as Bitcoin. If you think you have been a fraud victim, contact the CRA immediately.