Manager’s Message
It is a busy time in our office. We just completed tax reviews for a large number of our clients and we are currently preparing T4s, T5s and T3s to meet the February & March deadlines.
Thank you to all our clients for taking the time to complete our surveys. We’ve received great feedback from those who responded via email and look forward to receiving the paper copies (that are currently being sent out) as well. Your input is greatly appreciated!
We have had several changes in our office related to an update on technology and phone systems. Our staff are busy getting trained and using these new programs that will help us serve you even better!
If you haven’t already please sign up for our secure client portal. The invite that we send you does expire within a week so reach out to us if you need us to resend you an invite.
Does your bank require you to have a compellation financial statement for financing reasons? If so we can prepare that for you, however we will need to know in advance of starting your financial statement, please contact me for more details and to discuss your needs.
Personal and corporate tax season is the most exciting time of the year for us because we are able to talk in person and virtually with quite a few of you. We all look forward to meeting your needs in the coming months!
Danielle Mytopher
Manager, Wheatland Accounting
Important Deadlines!
February 16 – RRSP Projection Deadline
February 28 – T4 & T5 Filing
March 3 – RRSP Contributions
March 31 – T3 Filing, Trust Return Filing (or 90 days from the year end of trust)
April 30 – Final day to pay, cancel or change AgriStability for 2024 program year
Capital Gains Exemption and Changes to the Capital Gains Inclusion Rates
The $1 million Lifetime Capital Gains Exemption (LCGE) for sale of small business shares or assets (land) for fishers or farmers increased to $1.25 million as of June 25, 2024.
The department of finance will introduce legislation in due course to change the inclusion rate from 50% to 2/3rds on capital gains realized in excess of $250,000 annually with a new effective date as of January 1, 2026. Whether that will pass remains to be seen but for now the 50% inclusion rate on all capital gains still applies.
Please Notify Us If:
- Your marital status has changed
- You have had a baby
- You have moved
- You have had changes in your health situation
- Your dependants living with you has changed
Changes to the AgriInvest Program
For the 2025 program year there is a requirement if your average allowable net sales is $1 million or more in the previous 3 program years to have a valid Agri-environmental risk assessment completed prior to receiving your government matching contributions. You can determine if your required by looking at your previous years deposit notices. An agri-enviromnetal risk assessment is an assessment that identifies agri-enviromental risks and includes sustainability tools and direction on how to improve their farm’s health For more information please visit agriculture.canada.ca.
2024 Charitable Donations
Donors will be able to opt to include donations made between January 1, 2025 and February 28, 2025 when filing their 2024 tax return.
Canadian Entrepreneur’s Incentive
The Canadian Entrepreneurs’ Incentive (CEI) is a new tax provision designed to support entrepreneurs by reducing the tax burden on capital gains realized from the sale of qualifying businesses.
The CEI lowers the capital gains inclusion rate to 33.3% on a lifetime maximum of $2 million in eligible capital gains. This means that when an entrepreneur sells their business, only one-third of the capital gains are taxable, potentially resulting in significant tax savings. The incentive is phased in over five years, starting in 2025, with the lifetime limit increasing by $400,000 annually until it reaches $2 million in 2029.
To qualify for the CEI, entrepreneurs must meet specific conditions:
- Business Ownership: The individual must own at least 10% of the shares in the business.
- Principal Employment: The business must have been the individual’s principal employment for at least five years.
- Qualifying Sectors: The incentive applies to businesses in sectors such as agriculture, manufacturing, wholesale, retail, and transportation. However, it excludes sectors like finance, insurance, real estate, food and accommodation, arts, entertainment, recreation, and professional corporations.
By reducing the taxable portion of capital gains, it allows for greater reinvestment into new ventures or retirement savings. For example, if an entrepreneur realizes a $4 million capital gain and qualifies for both the Lifetime Capital Gains Exemption (LCGE) and the CEI, the tax payable could be significantly reduced compared to the standard inclusion rate.
Give us a call to understand the full implications based on their individual circumstances. Planning ahead can ensure that all eligibility criteria are met and that the benefits are maximized.
Tax can be rewarding!
Clients that have ALL of their 2024 tax information to us before March 31, 2025 will be entered into a draw for a $50 credit on their Wheatland account.
Clients who send us their information electronically by March 31, 2025 will also be entered into a draw for a $50 credit on their account.
Please have all your tax information in prior to April 17th and your signed T183 to us by April 28th to guarantee completion by April 30th.
Send us all your information electronically by March 31st and be entered to win both draws!
Do you have a property that you offer for rent for periods of less than 90 days? You could be caught by CRA changes to the short term rental properties.
Effective January 22, 2025, the Canada Revenue Agency (CRA) introduced changes to the taxation of short-term rental income. Notably, income tax deductions related to non-compliant short-term rentals are now disallowed.
A non-compliant short-term rental is defined as one that:
- Is located in a province or municipality where short-term rentals are prohibited.
- Fails to meet all applicable provincial or municipal registration, licensing, and permit requirements.
For 2024 and forward, if a short-term rental is non-compliant for any portion of the tax year, the non-compliant amount is calculated by multiplying the total deductible expenses by the ratio of non-compliant days to total rental days. This adjustment ensures that only compliant short-term rental activities benefit from tax deductions.
These regulatory changes have several implications for short-term rental operators:
- Compliance: Operators must ensure they meet all local registration, licensing, and permit requirements to avoid penalties and loss of tax deductions.
- Financial Impact: Increased fees and potential tax liabilities may affect profitability.
- Operational Adjustments: Changes in allowable rental durations and other operational requirements may necessitate adjustments to business models.
The evolving landscape of short-term rental regulations reflects a concerted effort by Canadian governments to balance the benefits of short-term rentals with the need for affordable housing. Operators are advised to stay informed about these changes and consult with legal and financial advisors to ensure compliance and optimize their operations.
If your correspondence preferences are set to “Electronic mail” in CRA My Account you will only receive notices of assessment and re-assessment, benefit notices, requests for information, and installment reminders electronically. If you are signed up for My business account you will only receive all correspondence electronically.
2025 Customer Agreements
All contracts for this year have been sent out. Please contact our office if you did not receive yours or have any questions.
