Get ready for 2010!

November 24th, 2009

So, in about another five weeks it’s going to be 2010…..and 2009 will just be another memory. ¬†This means that it’s high time to start year end tax planning. ¬†Over the next few weeks I’ll be publishing a few tips about minimizing taxes using a few year end techniques. ¬†Nothing too ground breaking, just the usuals.

Let’s start with one of the very best tax breaks there is: ¬†charitable donations! ¬†Donations receive special tax treatment. ¬†In Nova Scotia, donations of up to $200 will get you back 24% in taxes. ¬†However, once you make donations of more than $200 the deduction goes up rapidly. ¬†Donations over $200 will get you back about 47% in taxes. ¬†So the ¬†government gives you back almost half your contribution, making donations easily one of the most rewarding tax breaks available!

There are plenty of quality charitable causes to support that make good use of their funds.  Look for a cause to support before the end of the  year, and reap the tax savings on your next tax return!

Filed under: Consumer Tax by David Boese No Comments »

Nova Scotia vs the Economy

November 19th, 2009

I wouldn’t want the Premier of Nova Scotia’s job these days. ¬†Well, I actually wouldn’t want it any day, but especially not when the red ink starts flowing.

The New Democratic Party was elected after promising to balance the budget and not raise taxes. ¬†Or at least that’s what the media claims…… I didn’t personally hear them say it. ¬†On November 16 the NDP announced that well, it looks like the budget won’t be balanced after all, and you know what, it looks like we’ll have to raise some taxes.

Strictly as a point of interest, did anyone really believe the NDP when they promised no taxes and a balanced budget? ¬†Haven’t we all heard these things before?

Anyway, it’s going to be interesting to see which taxes get raised and by how much. ¬†I’m guessing they’ll raise the tax rate on top earners, as they usually get picked on first. ¬†I’m also guessing they’ll bump up the HST rate by a point or two. ¬†I’m also guessing that they’ll coin these measures as “temporary” but is there anything so permanent as a temporary tax increase?

From a tax view, it will be interesting to watch what gives.

Filed under: Consumer Tax by David Boese No Comments »

There has been a lot of feedback in the last couple of weeks over the $5,000 lobster fishermen assistance program, officially known as the Short Term Transitional Measures.  It seems that the Department of Fisheries and Oceans (DFO) has been turning down a number of fishermen that should be eligible, stating that they have not experienced a decline of 25% over last year.

If you feel that you have been incorrectly denied, by all means send in an appeal. ¬†In some areas it appears that DFO may be using some inaccurate pricing statistics, which skewers the calculations. ¬†In your appeal you will be given the chance to provide them with your correct pricing and weights. ¬†In your denial letter you will find DFO’s contact information.

Filed under: Business tax by David Boese 1 Comment »

The Conservative Party released new legislation today, that would allow self employed individuals to begin receiving special Employment Insurance benefits. ¬†The Minister of Human Resources and Skills Development Canada, Diane Finley, says that “”The self-employed have had little or no income protection to cope with major life events, such as giving birth, caring for a newborn or newly adopted child, being sick or injured, or caring for a gravely ill family member. ¬†Extending access to these benefits is the fair and right thing to do.”

Note that the only types of EI benefits that will be available to the self employed are maternity benefits for mothers, parental/adoptive benefits, sickness benefits, and compassionate care benefits.

Maternity benefits are available to birth mothers for a maximum of 15 weeks.  Parental/adoptive benefits are available to either biological or adoptive parents, while they are caring for a newborn/newly adopted child, for a maximum of 35 weeks.  Sickness benefits are benefits that can be paid to a person who is unable to work either because of sickness or injury, for up to 15 weeks.  Compassionate care benefits are available to persons who need to take time off work temporarily to support a family member who is gravely ill, with a significant risk of death.  Compassionate care benefits are available for a maximum of 6 weeks.

Self employed individuals who want to opt into the program must do so at least one year before claiming benefits.

The self employed individual would be able to opt out of the program at the end of any tax year, as long as they have never claimed any benefits.  If they have claimed benefits, they would be required to contribute to the program on their self employed earnings as long as the remain self employed.  In other words, if you plan to join the program, be prepared to remain in the program!

Self employed individuals would pay EI premiums at the same rate as regular employees. ¬†It is interesting to note that, unlike the Canada Pension Plan, the self employed individual would NOT need to pay the employer’s portion, but just the employee portion. ¬†This is apparently because self employed individuals don’t qualify for EI regular benefits, just the special benefits as described above.

All in all, it’s a rather interesting concept. ¬†Introduced as the¬†Fairness for the Self-Employed Act, the legislation will need to pass parliamentary approval before it is law.

Filed under: Business tax, Other tips, Personal Tax by David Boese No Comments »