Payroll

2021 TD1 Basic Personal Amounts

by

Happy New Year!

For those of you who have accounting software where the personal exemption amounts need to be entered re: payroll, this can be done under each employee’s profile.  For simplicity purposes, I’m including basic personal amounts below for the 2021 calendar year (alternatively, you can follow the links provided to determine appropriate amounts).  If you’re applying an amount other than the basic personal amount, ensure that you print the worksheets provided in the links, and have the employee sign the form (if going with a basic personal amount, the employee’s signature is not required).

  1. Basic personal amount re: federal income taxes 2021 is $13,808; and
  2. Basic personal amount re: Nova Scotia income taxes 2021 is $8,481.

Link to the Federal TD1 form:

2021 Personal Tax Credits Return (canada.ca)

Link to the Nova Scotia TD1 form:

2021 Nova Scotia Personal Tax Credits Return (canada.ca)

Stay safe,

TFSA audit project by CRA

by

“To date, the CRA has reassessed more than $75 million in additional taxes resulting from audits of TFSAs.  In 2016, the CRA released Income Tax Folio S3-F10-C1 Qualified Investments – RRSPs, RESPs, RRIFs, RDSPs and TFSAs, which provides information on the tax consequences of a registered plan carrying on a securities trading business.  In the Folio it is explained that the determination of whether a particular taxpayer carries on a business is a question of fact that can only be determined following a review of the taxpayer’s particular circumstances. Interpretation Bulletin IT-479R, Transactions in Securities sets out factors developed by the courts that are relevant in determining whether transactions in securities constitute carrying on a business. There is nothing unique to TFSAs when determining whether transactions in securities constitute carrying on a business.”

In other words, TFSA trading can be classified as “carrying on a business” by the CRA and would therefore result in tax consequences for the tax payer.  If you have investments in TFSA and if they are invested through a broker, it may be prudent to have a discussion with your broker to find out what trading patterns are being followed — to ensure that your retirement fund in maintaining its intended classification.