My name is Mark Goodfield. Welcome to The Blunt Bean Counter ™, a blog that shares my thoughts on income taxes, finance and the psychology of money. I am a Chartered Professional Accountant and a partner with a National Accounting Firm in Toronto. This blog is meant for everyone, but in particular for high net worth individuals and owners of private corporations. The views and opinions expressed in this blog are written solely in my personal capacity and cannot be attributed to the accounting firm with which I am affiliated. My posts are blunt, opinionated and even have a twist of humor/sarcasm. You've been warned.

Thursday, March 21, 2013

2013 Federal Budget

The Federal Minister of Finance, Jim Flaherty, today presented the 2013 Federal Budget. While there are no changes to corporate income tax rates, there is an increase to the personal income tax rate on non-eligible dividends paid by most private corporations out of active business income. There is no change to the taxation of eligible dividends paid by most public corporations.

Small corporate business owners planning to sell their business got a pleasant surprise in the budget when Mr. Flaherty increased the capital gains exemption for qualified share sales to $800,000 from $750,000 effective for 2014.

The Finance Minister seemed somewhat preoccupied with closing tax loopholes and stopping international tax evasion and ensuring compliance with the filing of the Foreign Verification Form T1135. To that end, the CRA will launch the Stop International Tax Evasion Program, or the more appropriately named “International Snitch Program”. Under this program, the CRA will pay rewards to individuals with knowledge of major international tax non-compliance when they provide information to the CRA that leads to the collection of outstanding taxes due. The CRA will require the outstanding tax liability to be in excess of $100,000 before entering into such a contract. The reward will provide for payment of up to 15% of the federal tax collected.

Therefore, please be advised, I will not be writing my blog anymore as I will be compiling my snitch list and retiring to Barbados on my 15% reward earnings (Just joking CRA, I have never met or heard of an international tax evader).

I provide a link to my firm, Cunningham LLP's budget summary (which I helped write) for those who want details of the budget.

The blogs posted on The Blunt Bean Counter provide information of a general nature. These posts should not be considered specific advice; as each reader's personal financial situation is unique and fact specific. Please contact a professional advisor prior to implementing or acting upon any of the information contained in one of the blogs.

4 comments:

  1. Glad to hear you do not carouse with Known Tax Evaders and such (although you might be the only accountant... no I had better not finish that sentence).

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    1. BCM, considering your viceral hatred of accountants, I guess I have to consider myself lucky you speak to me even though I am an acountant :)

      p.s. Did I tell u I worked on the Nortel account (just joking)

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  2. Can someone explain to me why he singled out the safe deposit box deduction? Are we really so desperate for tax dollars that all those $45-100 box deductions are bankrupting the country?!

    Interesting that they're trying to get people to donate more through a "bonus" tax deduction. I wonder what the logic of that one was, too. Does it apply to political contributions (she asks suspiciously) or just the regular "real" charities?

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    1. Hey Bet,

      I think the safety deposit box deduction was just a ridiculous deduction in the first place, so it was more of a loophole close than a significant tax saving for the government.

      The donation credit is not for political donations. I think it is a true attempt to get more people to give to charities which are suffering in many cases.

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