Blog Archives - BMP ACCOUNTING & TAX INC.

CEWS

10/30/2020

As Canadian businesses struggle to overcome the financial impact of Covid-19, they may experience issues with keeping their employees employed and paid. The federal government launched the Canada Emergency Wage Subsidy (CEWS) to help cover the cost of employee wages, retroactive to March 15th. This subsidy enable businesses to re-hire your workers, prevent more job losses and help you ease back into your normal business activities.

Sounds great. But what else should you know? CEWS is a taxable income to businesses and should be included in your corporate tax return (if you applied as a sole proprietor, it should be included in your business income).

CRA does expect businesses to maintain adequate books and records to support the accuracy and completeness of your claim. Supporting paperwork such as showing the calculation of the wage subsidy claimed for each eligible employee is also required. Failure to provide adequate proof that your claim is legitimate may result in penalties.

You may be required to return part of all of the subsidy if you:
Cancel an application Amend a previous application Found calculation errors for a claim period Find out you do not qualify for the subsidy after a payment is received Received a notice from CRA stating that after a review, your claim has been denied or reduced The returned subsidy may be subject to interest.

Got more questions about CEWS? Contact Us.

T4's - 2020 Issues

10/21/2020

This has been the year of adjustments. A huge number of businesses have had to reinvent how they handle their day-to-day business. It is no surprise that T4’s have not been spared.

For the 2020 tax year, employers will be expected to report pandemic-related benefits in the other information on T4 slips in an effort to track payments. This means that income earned from an employer between specific time frames must be reported under specific codes.

Another addition to T4’s this year is the amount of CEWS you used for each employee’s salaries by using special codes in the “other information” portion. CRA will release more information about the specific reporting requirements at the end of the year.

If you qualified for the 10% Temporary Wage Subsidy, you will first have to keep all payroll records including your calculations for eligible employees. You are also required to submit a form for each of your payroll accounts. CRA will use information submitted in you’re the form you submitted to reconcile each payroll account.

Do you have more questions regarding T4s and T5s? Contact Us.

We Love Corporate Tax Returns

10/13/2020

Are you the owner of an incorporated business? Did you know BMP loves corporate tax returns? Among our partners, we have a collective of 45 years of experience with corporate tax returns and one of our partners was tax auditor with CRA and the province. We are able to provide quality products for a reasonable price point (our corporate returns start at $500).

We can help you navigate CRA audits, tax objections, disclosures and appeals, corporate tax filing and planning and personal tax planning for owners, and filing corporate tax returns. We file returns electronically and we provide you with financial statements along with analysis on your financial position. We can help you understand how to be more profitable and how to pay yourself and other shareholders better.

As part of preparing your corporate return, we can file your WCB return, and file your T4s, T4As and T5s. If you have employed contractors during the year, we can issue them a T4A on your behalf. T5s are issued when the corporation issues dividends.

Do you have more questions regarding tax implications of owning a corporation? Contact Us.

Tax Help: CERB & CESB

10/1/2020

As many Canadian businesses were forced to close their doors and later modify how they do business in a World during a global pandemic, Canadians struggled to make ends meet. The Canada Emergency Response Benefit (CERB) and Canada Emergency Student Benefit (CESB) were launched in March and May respectively to relieve some of the pressure. Employers deduct taxes prior to depositing their employees’ pay into their account. However, this was not the case with CERB and CESB benefits.

What does this mean? CERB and CESB are taxable benefits and so you may owe CRA some taxes next tax season if you have earned other income for the year. If you have made less than $13,229 during 2020 you will not have to pay taxes on your income, including CERB and CESB installments.

There are many factors that will affect taxes owing for folks who made over $13,229 in 2020 such as a change in your tax bracket. However, if your income has decreased in 2020 you may be eligible for child credits or GST credits you would have not qualified for previously.

If you have received CERB or CESB payments, chances are you may be experiencing financial hardship and may find it difficult to put money aside for taxes you may owe in April. Contact us to find out what we can do to help.

Do you have more questions about CERB and CESB? Contact Us.