Tips for the 2019 Tax Season

Canada 2019 Tax Season – Everything You Should Know. It’s the time of the year again when taxes are the most important thing on everyone’s mind. There are new rules this year that could impact people who attend post-secondary institutions, are entrepreneurs or use service animals.

Many of the most notable tax changes for the 2018 tax year affect small business owners, such as the decreasing of the federal small business tax rate from 10.5 per cent to 10 per cent, experts said.

Changes Affecting Service Animals

One of the most significant changes is the expansion of a tax credit for expenses related to service animals.

This tax credit already applies to service animals trained to help people with blindness, deafness, autism, severe diabetes, severe epilepsy and significant, long-term restrictions on the use of their arms or legs. The 2018 tax year is the first in which the credit will be available for service dogs trained to help with severe mental health issues.

Taxpayers can receive a credit for the cost of obtaining the animal, its food and veterinary care, and its training. Animals that provide comfort and emotional support, but do not have the training to assist people living with PTSD or other mental health conditions, do not qualify for the credit, media reports have said.

Moving Expenses

Moving expenses will also see some changes. When people move for work-related reasons, it can still be claimed in a tax return, but there won’t be any tax deduction for home-relocation loans.

CTV reported that post-secondary students in Saskatchewan and Ontario are no longer eligible to receive provincial tax credits for their tuition. A similar change was introduced in New Brunswick in 2017. Tuition costs still qualify for federal tax credits in all three provinces.

For Business

In the world of business, accelerated capital cost allowances have been introduced. In this, companies can claim deductions for capital purchases sooner.

Income-splitting rules have also changed, with business owners no longer allowed to pay dividends to family members as a means of reducing their tax burden. Relatives of business owners can still receive dividends at a lower tax rate if they can prove they contributed to the business within the past five years. This means that family members would have to have an active role in the business to receive a dividend.

The carbon tax is another topic people have been debating about. The federal government’s imposition of a carbon tax on Manitoba, New Brunswick, Ontario and Saskatchewan includes offsetting payments in the form of tax credits.

One person in every household can claim the credits in each of those provinces. The government has said most families will receive more through the tax credit than they will pay in increased costs for gasoline, natural gas and propane. The tax credit is expected to help taxpayers offset extra costs.

The carbon tax is scheduled to take effect April 1, although a legal challenge to stop it remains before the courts.

Anyone who owes the government money has until April 30 to file and pay personal income tax return for 2018 without being penalised. Self-employed people have until June 17 to file, although if they have a balance owing, interest will start to accrue on their accounts as of April 30.

Even though the deadline seems like it is not near yet, preparing your returns and having everything in place to file early could be in the best interest of your business.