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Tax Traps
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Provincial Income Tax
Provincial Sales Tax
Contractor Or Employee
Capital Gains
Attribution
Transfers To Relatives
Transfers To Spouses
Investment Income Attribution
Corporate Attribution
Family Salaries
Superficial Losses
Personal Services Business
Stop Loss Rules
Association Problems
Automobile Lease
Parking Benefits
Automobile Benefits
Donations
RRSP Withdrawals
Directors Liability
Auto Record Keeping
Shareholder Bonuses
Management Fees
 
 

 

Tax Traps

 

The following is a collection of common mistakes taxpayers make or problematic areas of concern which may result in severe tax repercussions. Adverse results are costly in terms of interest and penalties on additional taxes if reassessed by CRA. Proper planning with your Chartered Professional Accountant can avoid most if not all of the pitfalls of income tax legislation. Contact Keith Anderson, BCom, CPA, CA-IT, CITP for more information.

 

 

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Provincial Income Tax Traps (hidden income tax liabilities)

 

Provincial Sales Tax Traps (hidden sales tax liabilities)

 

Independent Contractor or Employee

 

Personal Services Business (dangers of being an Independent Contractor)

 

Capital Gains Versus Business Income (income can be taxed in different ways)

 

Attribution Of Income (general income splitting problems)

 

Transfers Or Loans To Relatives (income splitting problems with Relatives)

 

Transfers Or Loans To Spouses (income splitting problems with Spouses)

 

Investment Income Attribution (more income splitting problems)

 

Corporate Attribution (attribution problems involving family owned corporations)

 

Salaries To Family Members (more income splitting problems)

 

Superficial Loss Rules (loss denied on certain dispositions)

 

Stop Loss Rules (other losses denied on certain dispositions - very complex)

 

Association Problems (multiple corporations in the family may have to pay tax at a high rate)

 

Automobile Leasing Cost Limits (some unintended restrictions on business deductions may occur)

 

Employer Paid Parking May Be A Taxable Benefit  

 

Employer Provided Automobiles May Be A Taxable Benefit 

 

In-Kind Donations To Charities May Be Scrutinized By CRA (problems with tax shelter donations)

 

RRSP Tax-Free Withdrawal Schemes (CRA says they are taxable)

 

Director's Liability (having a corporation does not always protect corporate directors)

 

Foreign Exchange Taxation Rules (don't overpay your taxes) 

 

Automobile Expenses & Recordkeeping

 

Shareholder Bonuses May Not Be Deductible

 

Management Fees May Not Be Deductible

 

 

 

Careful planning with a Chartered Professional Accountant is warranted. Contact Keith Anderson, BCom, CPA, CA-IT, CITP at (780) 447-5830 if you need advice. 

 

 

 

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Keith Anderson, BCom, CPA, CA-IT, CITP Copyright September 9, 1999 Last Modified :07/16/18 04:17 PM