CRA- Uncashed Cheques

This is BIG news all over social media the last few days- Canadians with uncashed cheques from CRA, some from as far back as 2001. Even if you have had direct deposit, many Canadians are finding that they have uncashed cheques waiting in their "My Account" for anywhere from $4 to upwards of $700 we've seen some people report! Cheques could be "uncashed" for a variety of reasons- including change of address, lost mail, stolen mail, etc. We highly recommend you "check" this out- as you may just have some unknown money waiting there for you. 

When you login to your My Account, there should be a list to the right under "related services". Near the bottom of this list, is a link titled "uncashed cheques". Clicking this will allow you to see if you have any uncashed cheques in your account, and will prompt you to fill out, download & print a form.

CRA was SO popular with Canadians checking their accounts yesterday, that some people reported the site crashing or being unusually slow! 

Hope this proves helpful, and who knows.. maybe you'll be treating someone to dinner this weekend or buying a little something special with that "free" money you found! 

It's as easy as checking your CRA- My Account. Link here

To learn more about these uncashed cheques from the CRA website, Link here. 

Feel free to contact us if you have any questions about your CRA My Account.      www.CahillCPA.ca           

Changes to the T1 Personal Income Tax Return Form

This may not be BIG NEWS to most, but to those of us in the accounting world, the changes made to the T1 personal income tax form has been something to talk about! 

Overall, CRA announced that the T1 form would have a new look. This includes more white space, increased font size, more pages, and simpler language wherever possible. It has gone from 4 pages to 8 pages. 

Our biggest reason for sharing this information with you, is so that you aren’t surprised when you see these changes! Ultimately, our accountants & staff are aware of all these changes and are happy to answer any questions you might have

Here’s a quick breakdown, if you're interested to see how your T1 form will look different this year. 

• Page 1 of your return still asks for basic personal information. 
• Page 2 is now divided into three parts. These three parts pertain to election information, the  Indian Act, and foreign investment properties. Depending on what you declare on these sections, you may need to complete additional forms. 
• Page 3 is calculating your total income (line numbers have now changed from 3-4 numbers, to 5. Ex. Line 150 is now 15000). 
• Page 4 now calculates net income (deductions, child care expenses, etc). 
• Page 5 is taxable income. 
• Page 6 is for calculating the various federal non-refundable tax credits. 
• Page 7 calculates your federal tax.
• Page 8 now completes your form, and calculates any refund or balance owing (and includes the Climate Action Initiative)  

Any questions- just ask!     www.CahillCPA.ca     604-985-0123

For a link to the full article by Jamie Golombek at the Financial Post. 

For more details from CRA, visit their website. 

TAX TIME TIPS

Tax Time Checklists: Cahill CPA offers some great online resources, including checklists for employment expenses, rental income & expenses, self-employment expenses, and more. Check out our resources page for these helpful checklists & more online resources. 

Reminder: Make sure to set up a CRA “My Account” online, where you can view and manage all your income tax information. 

To learn how, go to:    http://bit.ly/CRAmyaccountlink

Important Dates:

February 24, 2020: CRA netfile service opens for electronic filing of your T1 personal income tax and benefit return. Start preparing your documents & arrange to have them sent to our office (electronically or in person). 

April 30, 2020: Deadline for filing your 2019 tax return

June 15, 2020: If you or your spouse/common law partner is self-employed.

As always, our greatest tip is to get your information in to us as soon as possible and contact our office with any questions. 

604-985-0123            www.CahillCPA.ca

Three Questions to ask your CPA

CPA BC put together a handy little guide for some questions you might want to ask your accountant to prepare for tax time. Although it’s still a ways off, it’s important to be organized & prepared to maximize your return!

Here are some helpful questions to ask us on your next email, phone or in-person meeting. Our team is available all year-round to answer your questions & provide advice. Remember, that we are your accountant all YEAR long, and not just at tax time. 

From CPA BC- Link Here. 

1. What can I deduct on my income tax return?
   You can reduce the amount of B.C. personal income tax you owe through basic tax credits. But if the total of these credits is higher than the amount you owe, then you won’t get a refund of the difference. Some changes from Budget 2018 include the replacement of the Infirm Dependent and In-Home Care of Relative Tax Credits with the B.C. Caregiver Tax Credit, as well as the elimination of the Education Tax Credit for 2019 and beyond. Here’s a snapshot of some of the most commonly used B.C. Basic Tax Credits:
    

If you make regular charitable donations and incur medical expenses, be sure to keep a close record of everything. Every dollar counts when it comes to tax credits.

What records do I need to keep?
It’s important to keep organized records to make filing your taxes a simple process. That way, you will be more likely to be able to maximize your eligible deductions, and ultimately reduce your taxable income, which will lead to less taxes owed.

Make it a priority to keep good personal financial records and have a file that contains all your tax forms. You could also consider using a financial management app to track your spending. Remember, you want to keep your records for a minimum of six years.

How can I maximize my savings account?
The 2019 tax year may be over, but you still have until March 2, 2020, to make a RRSP contribution for 2019. Check your RRSP deduction limit on your 2018 Notice of Assessment to determine how much you can contribute for 2019. The maximum RRSP limit for 2019 is $26,500. If you have an employer matching program, you should confirm how much you and your employer have already contributed to your RRSPs in 2019.

If there is room left for contribution, consider making an additional contribution to your RRSP for the 2019 tax year. By doing this, you may gain some tax savings. However, remember that you can make an RRSP contribution and not claim a tax deduction in the same tax year. If you think your marginal tax rate will be higher in the future, you should consider applying the deduction in a future year.

If you didn’t maximize your TFSA contribution room for the 2019 calendar year, you could also consider moving some of your money from your chequing (or savings) account into your TFSA account. For 2020, the contribution room is $6,000. Remember, your contributions to TFSA are not tax deductible and the contribution room can be carried forward indefinitely.

In summary… 

1. Make sure to let your accountant know about any tuition, medical expenses, charitable donations etc. to make sure you are maximizing any tax credits. 
2. Keep all records organized and up to date to simplify filing at tax time. 
3. Make sure to talk to us about RRSP and TFSA contributions, and how it might impact your return. 

Source: CPA BC “Three Questions to ask a CPA”

https://www.bccpa.ca/news-events-publications/publications/rrsp-tax-tips/2019-rrsp-tax-tips/ 

Prepare Early for Tax Time

Thanks CPA BC for putting together three great tips for preparing for tax season! Although April seems like a long way away, it doesn’t hurt to prepare early. Every year tax time seems to “sneak up” on clients, and causes an added stress as they scramble in the last week of April to get prepared. With a few simple tips, tax time can be a whole lot easier & stress free! (Imagine!) 

The deadline for the 2019 tax year is Thursday April 30, 2020. 

Here are the THREE tips from CPA BC- Link here. 

1. Centralize (or digitalize) and itemize your files
   Gather all tax-related files, receipts, and other paperwork in one place so you have it when you file. Consider scanning your files and saving them securely on your hard drive or cloud storage so you can easily access them. Itemizing and categorizing your files by the type of paperwork, such as medical receipts, tax forms, and charitable receipts, will also make your life easier when it comes time to file your income tax return.
   By the way, scanning your receipts on a regular basis may be a good practice so you can not only prepare for the tax season, but also keep a record—just in case the CRA wants to review them later.

*** If you want advice on the best way to organize all your documents or to get set up with Quickbooks, be sure to let us know. 

1. Keep track of your capital gains and losses
   Sold stocks or your home? Keeping track of your capital gains and losses throughout the year is important. Make sure you have records of your buying and selling prices to make it easier to file your taxes.

***Always let your accountant know of any changes that might impact your return. This might also involve a change in marital status, new dependents, etc.

1. Don’t delay, start now
   Get into the habit now and do not wait until April 30 to look for and review your files. By staying on top of your paperwork now and throughout the year, you can avoid surprises like forgotten receipts and missing documentation that could result in underestimated taxes. Once you have a system working for you, make sure to keep using it after the tax season is over.

***And be sure to get in contact with our office as early as possible to avoid missing important deadlines! Once you have all your documents, get in touch with us so we can get started on your return right away. 

Source: CPA BC Website- 2019 RRSP & Tax Tips

https://www.bccpa.ca/news-events-publications/publications/rrsp-tax-tips/2019-rrsp-tax-tips/

Minimizing Capital Gains on Inherited Property

Cahill CPA partner Jordan Cahill was recently asked to provide some expertise on the topic of capital gains. He colloborated with local Vancouver Realtor Shawn Brown from West Haven Group, Oakwyn Realty. Shawn created three helpful tips for individuals looking for information on minimizing capital gains on inherited property. The aritcle & video can be found here. Thanks again to Shawn for including us! 

Tip #1 PLAN EARLY!  

Planning early with your accountant and tax specialist is key. More options exist the sooner you begin planning for things like this. 10 or more years out is not excessive.

Tip #2  TRANSFER TITLE EARLY DURING A DOWNTURN.  

Real estate markets tend to be cyclical. You can transfer title to your recipients early during a downturn when the property’s value is relatively low to minimize the capital gains tax.

Tip #3  ESTABLISH A TRUST  

A third option is setting up a trust. A trust allows you to transfer the title of your property to be held for the benefit of the beneficiaries of the trust which can be determined by you. A trust will avoid probate fees upon death. Probate tax is about 1.3% of the estate’s value.

Shawn created a short & simple youtube video describing these three tips, which you can find here. 

For more information on this, or any other accounting related topic, call or email our office. 604-985-0123   

Tax Changes for 2020

Welcome to 2020!

Here’s a quick breakdown of some of the tax changes for 2020, sourced from an article by Jamie Golombek for the Financial Post.

1. Increases to the tax bracket thresholds

This is done every year to income tax and benefit amounts to accommodate for inflation (this year, a 1.9% rate). Increases to the tax bracket thresholds and various amounts relating to non-refundable credits took effect on January 1st. Increases in amounts for certain benefits, such as the GST/HST credit and the Canada Child Benefit do not take effect until July 1st of this year. 

2. Contributions to Canada Pension Plan

The rate for contributions is up from 5.1% to 5.25%. This makes a greater impact to self-employed individuals who pay both the employee and employer portion, making it a total of 10.5%.  Because of these changes, it means that the maximum contribution for employers and employees is up slightly from last year. 

3. Basic Personal Amount (BPA)

If you aren’t aware, in Canada, individuals have what’s called a BPA.  Basically this was created to help all Canadians cover their “basic needs” and ensures that no federal income tax is imposed on a portion of income that you earn. The change this year, is that the amount is increasing above the usual percent designated for inflation (which will gradually increase over the next two years). It will also be designed to benefit lower income individuals, and wealthy individuals will not be benefiting from these changes (essentially, helping those who need it the most). =

4. Employment Insurance Premium Rate & Maximum

The EI rate for 2020 is dropping slightly from 2019, from 1.62% to 1.58% of insurable earnings. 

For more information on these, or other tax changes this year, contact our office located in North Vancouver. 604-985-0123.

Source Credits:

Financial Post: Jamie Golombek, CPA, CA, CFP, CLU, TEP is the Managing Director, Tax & Estate Planning with CIBC Financial Planning & Advice Group in Toronto. Link to source here.

Merry Christmas

Wishing all of our clients, friends and family a very Merry Christmas & Happy New Year. Thank you for your continued business and support- we wish you all the very best in 2020. 

From the partners and team of Cahill CPA

Holiday Hours

Our staff will be out of the office during the Holiday season. If you have any pressing questions or concerns before year end, please get in touch with us by Friday December 20th.

Below are our holiday hours:

Our office will be closed: December 24th- January 1st

We will be back in the office January 2nd. 

Merry Christmas & Happy New Year to you and your family. 

North Shore Reader's Choice Awards- Favourite Accountant

It's that time of year again- the North Shore Reader's Choice Awards voting is now open, and we are hoping you will choose Cahill Chartered Professional Accountants as favourite North Shore Accountant for the second year in a row!