When you sell personal use property such as a car, jewelry, or furniture for more than you paid for it, you have to report and pay income tax on the net capital gain. The definition also includes real property, including the principal residence you own. The Income Tax Act provides a principal residence exemption for capital gains on the sale…
If you have left Canada to work in another country or are considering moving from Canada, it is important to consider the income tax consequences and your tax options. If you are a resident of Canada, then you are required to pay income tax on your woldwide income. Leaving Canada to take up residency in another country may not be enough to…
The Income Tax Act has broad and general rules requiring most fringe benefits to be included in net employment income. The government wants to discourage employers from substituting tax-free fringe benefits for actual cash compensation to avoid income tax. In the end, the value of a benefit of any kind must be added to your employment income. Examples of Taxable…
Many employers offer a range of benefits to their employees. The value of fringe benefits are considered taxable benefits and are included as income on your paycheque. This begs the question: Are fringe benefits really a benefit? It is possible to get the same benefits yourself for less? You need to know your marginal tax rate, how much benefits will cost you and…
There are two different types of personal trusts referred to in the Income Tax Act: Testamentary trusts and inter vivos trusts (Inter vivos literally means "among the living"). Testamentary trusts arise out of or on the consequence of the death of an individual and an inter vivos trust is any other personal trusts that are not testamentary trusts. Note however…
The 2007 tax year was a big win for seniors when the Government introduced pension income splitting which allows lowering income taxes between spouses. Prior to these new rules, only Canada Pension Plan could be split but the calculation was done by the Government and was not straight forward. How Pension Splitting Works In order to split your pension income,…
