Tax gems are hard to find today and appear to be an abomination to both the federal and provincial levels of government. With increasing frequency, they tend to be extracted like decaying teeth. Virtually every tax reform introduced by the former Conservative government, such as the family tax cut, increases to the Tax Free Savings […] Read more
Stories by Grant Diamond
Planning for the unthinkable — divorce and taxes
As unappealing as the thought may be, roughly half of Canadian marriages end in divorce. It is inevitable, then, that divorce and its associated financial unbundling of family assets have serious tax consequences. Obviously, no one enters a relationship with the plan to break up, but prudence suggests consideration be given to a written marriage […] Read more
Change to life insurance tax coming
Life insurance, along with one’s principal residence, Registered Retirement Savings Plans and Tax-Free Savings Accounts, have long played critical roles in supporting the financial health of Canadians. However, the taxation of life insurance is about to change. This means any additions or changes you make to your life insurance plans after Jan. 1, 2017, might […] Read more
Ottawa changing tax rules for intangible property
A farm has many assets. Some are tangible, such as buildings and equipment, while others are intangible, such as milk quota and goodwill. For a long time, it was thought that the tax rules relating to intangible property, also known as Eligible Capital Property, were too complicated. The most recent budget finally addressed the matter. […] Read more
Tax filing not something to ignore
Many taxpayers view their annual filing as a stressful exercise and feel great relief when the job is done. Some people chose to avoid the task. The Canada Revenue Agency says, 10 to 15 percent are non-filers based on the country’s total population. That amounts to a substantial number of people. It includes some in […] Read more
New tax hike complicates dividend distributions
A new year and a new government introduce a new highest marginal tax bracket, which brings with it the pain of new and aggressive tax increases. The Liberals promised new and popular spending strategies during last year’s election campaign and said they could be partially financed with only modest increases in taxes on the wealthiest […] Read more
Share cropping: is it farm or rental income?
Share cropping is not as common as it used to be, but it is still a popular arrangement between landowners and renters. Much depends on the landlord’s involvement in the production process when paying tax on the proceeds from this type of rental agreement. This helps determine if the revenue should be taxed as rent […] Read more
What happens when a partnership changes or ends?
A business partnership agreement should recognize that people come and go in our lives and businesses. It should be drafted in a way that accommodates change so as to avoid problems later on. A partner might want to leave, so the agreement should anticipate how to buy out that person’s interest. The partners might want […] Read more
Farm partnerships must include written agreements
In our last article we discussed the importance of registering a partnership and establishing a sound partnership agreement between the partners. Without the latter, the Canada Revenue Agency has the ability to establish the portion of income generated as being equal among partners when that may not be the intention of the partners. Key components […] Read more
It’s all about timing when deferring capital gains
Disposing of farm property usually results in capital gains, which are taxable. However, it is possible to postpone such gains by deferring them if the farmer plans to replace the property in the future. The decision will be based on the timing of the acquisition of the replacement property. There are two types of property […] Read more
