Well, 'tis the Season! We are fast approaching December 31st, which is the end of the taxation year for all individuals and most trusts. Accordingly, much last minute tax planning will occur in order to ensure effective tax management. One of the most common tax planning techniques is to look at charitable donations (with gifts needing to be made on or prior to December 31, 2008 in order to be used as tax credits for individuals and most trusts for the 2008 taxation year).
Posted by: Kim G C Moody in Corporate tax on
Oct 21, 2008
A very common tax savings is the capital gains deduction that can, subject to various conditions, be utilized upon the realization of a capital gain on the disposition of qualified small business corporation shares. The deduction can shelter up to a lifetime maximum of $750,000 of capital gains. However, very careful planning must be done in most cases in order to ensure that the deduction can be utilized.
My, how time flies! A year ago, Moodys LLP Tax Advisors opened its doors with great expectations and hoping to start the tax world on fire. Well, it certainly has been an interesting year!
The objective of opening Moodys LLP Tax Advisors was simple: to focus on what we do best – tax advisory services – and delegate the rest to other more qualified advisors. The Income Tax Act and related matters (such as cross-border advisory services, estate planning, investment advisory services, etc.) has become such a specialized area that it is difficult to do all services well. Accordingly, we sensed that clients desired high end specialized income tax advice - especially at the private client level (given that such clients tend to have a hard time finding specialized tax advice).
Our July 9, 2008 blog entry on Capital Gains vs. Income highlighted the challenges that taxpayers face when dealing with dispositions of property and the tax treatment thereof. One of the more difficult issues in this area is whether or not a disposition of real estate property could be considered to be on account of income.
As many readers know, Stephen Harper and the Conservatives asked the Governor General to dissolve Parliament on September 7, 2008 and a Federal Election was called for October 14, 2008. While the pundits and the media will be working overtime for the next 34 days, what does this mean for income tax purposes?
As most readers know, Canada’s system of taxation is one that will tax based upon residency. To the extent that you are a resident of Canada, you will generally pay Canadian income tax on your worldwide sources of income. To the extent that you are a non-resident of Canada, only certain types of income (such as Canadian source income or dispositions of taxable Canadian property) will be subject to Canadian income tax. Most of the countries in the world have a similar system of taxation as that in Canada where the primary tax basis is that of residency.
