Tag Archives: GST & HST

Tax Tip #3 – Newcomers to Canada

Are you a new resident of Canada? If yes, then you will find these tax tips very interesting.

If you are a newcomer to Canada, you can be authorized to receive payments such as the Canadian Child Tax Benefit (CCTB) or the goods and the services/harmonized sales tax (GST/HST) credit. To receive these credits, you must report your income from all the sources, including money earned worldwide and within Canada. Like all the Canadians, you have the right and the responsibility to file your income tax every year.

Source: Canada Revenue Agency  http://www.cra-arc.gc.ca/menu-eng.html

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Tax Tip #2 – RRSP Contributions

A Registered Retirement Savings Plan (RRSP) can help you save for retirement, an education or even buy your first home.  You have until February 29, 2012 to contribute to your RRSP so that you can reap the benefit of a tax deduction on your 2011 tax year.  To retrieve your RRSP deduction limit for 2011, please refer to your 2010 Notice of Assessment.  You can also use the new online service offered to you by the CRA named “My Account”.

My Account lets you obtain the information on your RRSP contribution limits, contribution requirements for the Home Buyers Plan and contribution requirements for the Lifelong Learning Plan.  You can also receive information on your Child Tax Benefits and your GST/HST payment information.

For more information on RRSP, visit http://www.cra.gc.ca/rrsp or log on to My Account at http://www.cra.gc.ca/myaccount.

Source: Canada Revenue Agency  http://www.cra-arc.gc.ca/menu-eng.html

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Tax Tip #1 – File For Your Children

The income tax filing for your children can be very beneficial to them in the future. For the 2011 tax year, if your child has income of less than $10,527 there is no tax to pay.  However, by producing an income tax return for your child, he/she will reap the benefit of creating RRSP contribution room which can be used in the future.

Also if your child is above the age of 18, they can be entitled to the GST/HST credit.  The only way your child can profit from this is to produce an income tax return.

For more information on payment dates and how the GST/HST credit is calculated, visit http://www.cra-arc.gc.ca/bnfts/gsthst/fq_pymnts-eng.html

Source: Canada Revenue Agency  http://www.cra-arc.gc.ca/menu-e.html

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Tax Hikes Everywhere!

Happy New Year! The Government is imposing various tax increases for all Quebecers in 2012. An increase in the QST, increase in the QPP contribution rate, increase in the health contribution fund, increase in gas tax, etc…

Now, more than ever it’s extremely important to seek professional advice and take advantage of all possible tax deductions available to you.

For more information on the various tax increases, please watch this short video.

 

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Another Increase in the QST Sales Tax Rate

On January 1, 2012, the rate of the Québec sales tax will rise from 8.5% to 9.5%. The new rate will apply to taxable supplies for which the QST will be payable as of January 1, 2012.

The QST is compounded on top of the 5% GST. The new effective combined sales tax rate is 14.975%.

The rules for determining when the QST will apply at the rate of 9.5% depend on the nature of the good or service supplied and the type of supply made.

For more information on how this increase affects your business, please consult Revenu Quebec’s website link.

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Government Spending Habits and Excessive Taxing

An overtaxed society can create a deficient economy when the populous is burdened with the extra expenses of excessive tax. Funds used here can be used on a more productive level or a healthier happier lifestyle. The journey from which the sum of $200 takes from pay check to the last penny is likely taxed in more ways than we realize and below is compromising example.

To begin with, let’s remove the 20% income tax leaving $160.00

From there, a modest 3% for old age pension contribution leaving $152.00 Next, a modest 2% for EI contribution which leaves $148.96 Then of course for the benefit of this example non-food purchases are made from the remaining $148.96 which of course are taxed a further 14% leaving an actual spending net of $128.10 from the original $200. Calculate this example over a year’s time and the average citizen could dish out close to $1,000 in taxes just on this $200 monthly allowance. And this is not inclusive with home expenses, heating, vehicle, gas, clothing, gifts etc.

Additionally upon retirement our little nest egg is taxed once again. Not only does this compound the original taxes taken years prior from the original $200, taxes 30 years later are far higher. Now, if we the people can find ways to adapt our living habits and by force mind you to accommodate this excessive taxing and/or create ways to generate additional income, then why is it so difficult for government to apply the same effort?

Each year the same questions arise within government. How can they raise more money? How can they pay for this service or that project? Yet, each time the answers fall under the same category or are mentioned on their list of solutions; tax the people. A simple and effortless solution is often considered ideal when the labouring efforts of others are involved isn’t it?

Alternative yet Simple Methods

An ideal start might be to revamp the way government and its branching departments spend our tax dollars in the first place. Needless expensive ad campaigns, excessive monthly allowable budgets inclusive with expensive dinner engagements, gas allowance, private travel etc. Do they really need to have that $200 meal? Is that really necessary when lower income earners foot the bill?

With a prosperous income to begin with why is there a need to use income from the people for their extravagant business trips and dinners? An ideal way to re-direct this money back to the people would be to account for it themselves and apply them as business expenses when filing taxes like the rest of the population.

There are far too many small government offices and positions branched out into too many different departments. An example: a simple phone call to any municipality and the prompts are endless as to which department you seek. Multi-tasking within these positions would definitely generate money.

Reason being, the regular job market which is another disturbing problem has developed into a endless array of multi-tasking jobs but are all categorized under one single job description. Yet, our wages are based on a pay scale which is outdated and almost pathetic.

If we the people can adapt to the demanding needs of a competitive job market saturated with multi-tasking jobs, then the thousands of needless departments within government can apply these same methods. This is how companies in Canada survive. This is how government can re-modify their labour costs using the savings to benefit in needed areas that seem to arise year after year.

Government needs to address these issues as it’s becoming more difficult to acquire simple jobs and simple housing for the average citizen who can’t afford post secondary education. How does one acquire experience when companies large and small refuse to train even for the simplest positions?

Today’s society and government is far too demanding, far too selfish focusing more on profits gained from citizens with the perfect credit rating, the healthy bank account and that over qualified resume.

Focusing on the whole picture here, a little leniency, human compassion and an overall team effort can go a long way when creating a healthy economy and a balanced government.

Author: Kellie Hastings

Researcher and writer of articles pertaining to health, anti-aging, pollution, and public/health awareness. For health concerns on GE Foods, Cloned animal foods, GE Food Watch List, Diseased Factory Farms- videos and FDA corruption visit [http://www.discovery-health.org]

US Dollar credit card

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When Dealing With the CRA Know Your Rights!

The Taxpayer Bill of Rights outlines what you can expect in your dealings with the CRA. Know the services you are entitled to before initiating any dealings with the CRA will help you make the most of your interactions.

Tip # 1 – Be prepared

Have pertinent information and documentation on hand when you contact the CRA.  This can include your:

Income tax report
Social Insurance Number (SIN)
Business number
GST registration number
Any correspondence relevant to your request or complaint to the CRA.

Tip # 2 – Be quiet and respectful

Addressing issues of taxes can be stressful. If you feel you that were treated unfairly and you are contacting the CRA to make a complaint, your emotions may be running high. Remember that the agent you are speaking to is probably not responsible or even aware of the situation you are seeking help with. They are there to assist you. If you are disrespectful or remove your frustration on them, you make it difficult for them to effectively understand your situation and provide the assistance you require.

Tip # 3 – Keep track of your communications

Take detailed notes of all your communications, written or verbal, with the CRA, including dates.

If you deal with the CRA by phone, make a written summary of the conversations.

Keep all correspondence you send and receive from the CRA.

A record of your transactions with the CRA may be useful at a later date in case of dispute about what was discussed.

Tip # 4 – Ask for the phone agents for their identification.

When you contact the call center of the CRA or general line of investigation, you are entitled to know the identity of the agent who handles your call. Ask the agent for their first name, agent identification number and regional suffix.
This information will will reinforce the agent’s accountability and may be useful if at a later date, you must prove that you spoke with someone at the CRA or to confirm that you have received advice.

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What is the Quebec Solidarity Tax Credit?

As announced in the March 2010 Provincial Budget, the Solidarity Tax Credit replaced the following:

  • QST credit
  • Property tax refund
  • Tax credit for individuals living in a northern village

To claim the solidarity tax credit, an individual must:

  • Be 18 or over
  • Be resident of Québec
  • Have legal status (Canadian citizen, permanent resident, refugee, etc.)
  • Not be confined to a prison or similar institution

Only one solidarity tax credit claim can be made per couple. To receive the tax credit payments, individuals must be registered for direct deposit. Individuals who are not already registered for direct deposit can register online using the Register for Direct Deposit service or submit their request for direct deposit along with their 2010 Personal Income Tax filing.

Payments for this new refundable tax credit will be paid once a month.

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2011 Brings Many Tax Increases

Make sure to count all your pennies because you are going to need them!

As of January 1, 2011 there have been a broad range of tax increases for all Quebecers and those individuals who live on the island of Montreal. Below is a list of all increases:

  • The Provincial sales tax rate (QST) increased to 8.5%. The combined GST/QST rate stands at 13.925%
  • QPP contributions will be calculated on the first $48,300 of earnings in 2011, up from $47,200 in 2010, so that the maximum payable by Quebecers will rise to $2,217.60 from $2,163.15 in 2010.
  • For the Quebec Parental Insurance Plan, the earnings threshold rises to $64,000 from $62,500 and the employee contribution rate increases to 0.537% from 0.506%, boosting the maximum payable to $343.68 from $316.25 in 2010.
  • Employment Insurance dues will be calculated at 1.41% on the first $44,200 of income, up from 1.36% on the first $43,200 in 2010, raising the maximum annual cost to $623.22, up from $587.52 in 2010.
  • The Quebec prescription drug insurance plan, also had its maximum annual premium increased to $600 from $585, though Quebecers who use the plan won’t face that cost until they file their provincial income-tax returns in early 2012.
  • A new provincial health contribution was announced in the last Quebec budget: $25 for all tax filers on 2010 returns, $100 in 2011 and $200 in 2012.
  • Individuals living on the island of Montreal will be subject to a new “car tax” which will be capped at $50 per vehicle owned. This new tax will be collected at the time of payment of the vehicle registration.
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Audit from the Canada Revenue Agency

Canada’s tax system is based on self-assessment, which means that individuals are responsible for accurately completing and filing their tax returns on time. The Canada Revenue Agency (CRA) provides Canadians with the information they need to meet their income tax obligations.

Auditing is a way for the Canada Revenue Agency to monitor and inspect GST/HST and income tax returns, excise taxes and duties, and payroll records. Although there is a high standard of compliance with the law in Canada, audits help maintain public confidence in the fairness and integrity of Canada’s tax system.

There are four common ways of selecting files for audit; computer-generated lists, audit projects, leads and secondary files.

For additional information on how the audit is conducted, please consult the “Audit” section of the Canada Revenue Agency’s website.

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