Keeping you up-to-date on small business news in response to the pandemic

As we’re sure you may have already heard, Prime Minister Justin Trudeau made some announcements this morning (March 27, 2020) about additional programs available to support small businesses. What these programs will have to offer could possibly be substantial to you, so we understand completely that you would like to know what this means to you. Unfortunately, the government has not yet released a lot of details, so we’re not able to answer with any accuracy whether you qualify, or whether it will benefit you.

Please bear with us and all of our accounting and bookkeeping colleagues (who are working together and sharing insights) as more information comes out over the next several days. We promise that as we learn more information about what will impact your business, you will be the first to know.

Here is what we do know so far:

  • Temporary Wage Subsidy – Originally introduced at 10% retroactive to March 18th, this new announcement brings the Temporary Wage Subsidy up to 75% retroactive to March 15th. There are no details yet on qualification, caps, or time period.
  • Small Business Loans – Up to $40K, government backed, interest free for one year, up to $10K could be forgiven – is what we know at this point. No additional details have been given as yet.
  • GST/HST Payments – These payments will be eferred until June 1st. Filings are still due, only payments are deferred.
  • Taxes/Duties on Imports – Payments are deferred until June 1st.
  • Bank of Canada has also cut the interest rate – down to 0.25%.

Thank you for your patience as we work to get more information. Wishing you and yours safety and good health as we all make our way through these unprecedented times.

Helping businesses keep their workers – Temporary Wage Subsidy for Employers

The Temporary Wage Subsidy for Employers is a three-month measure that will allow eligible employers to reduce the amount of payroll deductions required to be remitted to the Canada Revenue Agency (CRA).

The following employers are eligible:

  • Employers who are a non-profit organization, registered charity, or a Canadian-controlled private corporation (CCPC);
  • have an existing business number and payroll program account with the CRA on March 18, 2020; and
  • pay salary, wages, bonuses, or other remuneration to an employee.

Note: CCPCs are only eligible for the subsidy if their taxable capital employed in Canada for the preceding taxation year, calculated on an associated group basis, is less than $15 million.

Intuit’s Quickbooks provides some useful information on how to calculate this for your business.

Employment Insurance (EI) and COVID-19

This information is developing and changing as the COVID-19 situation unfolds. We’ll do our best to update the details as they change.

Laid off due to work closures?

  • Apply for regular EI benefits
  • You will need 700 work hours in last year
  • You will need a ROE saying you’ve been laid off from your employer to get benefits
  • There is a 1-week wait period (so you will not be paid for 1 week)
  • Apply online: https://canada.ca/en/services/benefits/ei.html
  • Call 1-800-206-7218 for more info

Unable to work due to self-quarantine?

  • Apply for EI Sickness benefits
  • You will need 600 work hours in last year
  • You do not need a ROE or sick note to qualify
  • The 1-week wait period has been waived
  • Apply online: https://canada.ca/en/services/benefits/ei.html
  • Call 1-833-381-2725 for more info

Laid off and ineligible for EI?

  • Apply for the Emergency Support Benefit
  • Amounts and eligibility has not yet been announced
  • Applications will be available in April via CRA MyAccount, My Service Canada Account, and a yet to be released toll-free number

Self-quarantined and ineligible for EI?

  • Apply for the Emergency Care Benefit for workers not eligible for EI (including self-employed) who are sick with COVID-19, quarantined, or taking care of a family member with COVID-19
  • Up to 15 weeks of benefits, up to $900 bi-weekly
  • Applications will be available in April via CRA MyAccount, My Service Canada Account, and a yet to be released toll-free number

Unable to work due to school closures?

  • Parents with children who require care due to school closures can apply for the Emergency Care Benefit
  • 15 weeks of benefits, up to $900 bi-weekly
  • Applications will be available in April via CRA MyAccount, My Service Canada Account, and a yet to be released toll-free number

Do I qualify for WorkSafe benefits?

  • WorkSafe benefits are not available for preventative measures or non-work-related exposure
  • Only file a claim for COVID-19 virus infection contracted through work-related exposure,/li>
  • Call 1-888-967-5377 for more info/li>

Government support during these unsettled and unsettling times

Here are some important updates and resources for taxpayers and business owners during the still unfolding COVID-19 situation.

Canadian personal income tax form“While it is tax season, the government said for individuals, the return filing due date will be deferred until June 1, 2020. The Canada Revenue Agency will also allow all taxpayers to defer, until after August 31, 2020, the payment of any income tax amounts that become owing on or after today and before September 2020.”
from “Federal government unveils $82 billion pandemic aid package for Canadians”
Daily Hive
March 18, 2020
Read more here.

“Corporations are still required to file their income taxes six months after their fiscal year ends, but similar to the personal tax changes, businesses will be able to defer tax payments until August 31 without incurring interest or penalties.”
from “Feds extend tax filing deadline, waive interest on balances owing”
BNN Bloomberg
March 18, 2020
Read more here.

The Government of Canada is taking immediate, significant and decisive action to help Canadians facing hardship as a result of the #COVID19 outbreak.
from Canada’s COVID-19 Economic Response Plan: Support for Canadians and Businesses
Government of Canada
March 18, 2020
Read more here.

Thinking of you, clients, colleagues, friends, fellow citizens – be safe and be well!

We’re here if you need us.

During COVID-19 circumstances, we can still meet with you virtually

Virtual meeting

With all the concern around COVID-19, Nevcon Accounting understands and sympathizes if you have to practice social distancing or self isolation during this time. We have decided that more online and phone meetings are appropriate for us, too. This is in line with guidelines and advice our government and medical leaders are offering about ways to minimize exposure.

We are well equipped to meet with you virtually to continue to serve your business and accounting needs. We offer many electronic ways for you to reach out to us, including:

Of course, if you still want to meet in person we can also arrange that.

Be safe, be well – and be in touch if you need us!

Changes to the way the Nevcon Accounting client portal works

Over the last few months, Nevcon Accounting has been reviewing the way it collects documents and gives you a copy of your personal tax returns. Previously, we have been using e-courier to send you any sensitive documents securely, including any documents needing to be signed. Well, this has been a great product over the last six years, but we have outgrown the services it provides. The only way to continue using it would be to introduce other services, which would have meant having everyone perform multiple logins. The service was fine, but we have found it to be a bit lacking in clear navigation and it was getting harder for long-term clients to find information on older returns.

Nevcon Accounting client portal login

With this in mind, we started looking at different solutions that would let us expand how we share information to you. As a result, we are introducing a new, improved client portal. The new portal is more like what everyone is used to in that it is a folder-based design with different folders for each tax year. Over the next few months, as you do your taxes with Nevcon, we will be sending you an invitation to set up a password to the email address we have on file. You will notice different folders and one will hold all copies for your personal tax returns. Nevcon will be slowly moving over the old return information to the new portal so you only have one place to go for everything.

One particular area of improvement is the upload folder. This will allow you to upload your tax slips or information securely without having to use email. Once you have uploaded a document, we automatically receive an email letting us know.

Another enhanced area is the items requiring signature. This area will have any documents that need a signature by you. An additional benefit is that, where allowed, you will be able to digitally sign the documents and once done, it will automatically notify us of the completion.

Overall, this will let you find historical information much easier and faster. The added benefit of being able to digitally sign documents will greatly improve the turn around times for all transactions and deadlines.

We have decided to make this the year of improvements. Our systems that we used have been static for the last 10 years – still reliable but perhaps lacking in new features and enhancements – and this year our goal is to make your experience with us much more straightforward, efficient and hey, maybe even fun!

Reminder re: T4 Statement of remuneration paid information slips

As T4 Statement of remuneration paid information slips are starting to be prepared and issued to Canadian taxpayers, here’s a reminder to keep in mind the new (2017) rules for Electronic Distribution of T4 slips:

The employer can only issue T4 slips electronically without the employee’s consent if the employer provides to the employee, by the last day in February following the calendar year to which the slip applies:

  • a secure electronic portal through which the employee can obtain access their T4 information slip
  • a secure site for printing the T4 slip, and
  • an option to receive paper copies of the T4 slip, upon request.

Here is the link to more information on the Canada Revenue Agendy (CRA) web site: Electronic Distribution of T4 slips.

Do you or a loved one qualify for the Disability Tax Credit?

Do you or a loved one qualify for the Disability Tax Credit?

If you or someone you know is sick or disabled, they may qualify for the Disability Tax Credit Certificate. This will allow them to get a non-refundable tax credit of $8,416.

When you apply for the first time, you will not get the credit automatically. It must be reviewed by CRA and can take a few months to process. Usually when it is submitted you are sent a letter asking if you want to wait for the review or they can process your return without it and do an adjustment if it is approved. CRA will also adjust other years if your doctor says the disability started in another year.

Before you fill out the application, you should ensure that you or your loved one meet the qualifications below:

  1. The sickness or disability must markedly restrict daily living activities.
  2. Part of the form must be filled out by one’s physician.
  3. The areas that CRA uses for its determination are as follows:
    • Vision
    • Speaking
    • Hearing
    • Walking
    • Eliminating
    • Feeding
    • Dressing
    • Mental functions
    • Life-sustaining therapy

If you believe you or your loved one will qualify, Nevcon Accounting can email you the form or you can download it from here.

This article was featured in our most recent edition of The Financial Enquirer quarterly email newsletter. Click here to subscribe.

Phone scams confuse and hurt everyone – be prepared!

Nevcon Accounting recently received a phone call from an angry individual that left us angry and unhappy, too.

This individual claimed his mother was receiving threatening phone calls about her tax bill and the calls were coming from our number. We explained to the caller that his mother was the victim of a phone scam. We in turn were the victims of caller ID spoofing, where a caller displays someone else’s name and/or number to misrepresent themselves and to trick people into picking up their calls.

The CRTC (Canadian Radio-Television and Telecommunications Commission) has a wealth of information on how to deal with telemarketing, unwanted and misleading calls and messages. We highly recommend checking out this information and making use of their tips and suggestions.

To be honest, it’s a shame we all have to be so suspicious, but this information is very useful for avoiding the hurt, confusion and worse that scammers try to cause.

Watch out for tax schemes and scams

beware-of-scamsIf a tax-related promotion sounds too good to be true, it probably is. Before you’re tempted to click on a link or make a call, check first with your tax professional or the Canada Revenue Agency (CRA).

Through this web site and our email newsletter, Nevcon Accounting will highlight new variations of tax scams that are making the rounds. For example, the Canada Revenue Agency (CRA) is warning Canadians about getting involved in tax schemes where promoters, including some tax representatives and tax preparers, are claiming that individuals can get a significant tax write-off by investing in real estate through a limited partnership.

What are tax schemes?

Tax schemes are plans and arrangements that attempt to deceive taxpayers by promising to reduce the taxes they owe, for example through large deductions or promises of tax-free income. Schemes can also include other creative ways to convince people they could pay less taxes.

Here’s how this scheme works:

This scheme is advertised as an investment opportunity in real estate through a limited partnership. It is usually heavily promoted as a product with a significant tax advantage and limited liability for the investor. The promoter of the scheme promises a tax write-off for more than double of what was invested.

Potential investors are advised that they can claim a significant tax write-off because of costs being expensed in the initial year of the project. For example, the investor has invested $5,500 and is advised that they can write it off on their taxes for $12,500 due to financial services, lease enhancement and tenant improvement costs expensed in the first year. This is not the case.

Limited partnerships are unique arrangements that provide investors with certain benefits similar to partnerships and corporate entities. However, different than general partnerships, the investor’s liability is restricted to the amount they invested. Therefore, they cannot claim a higher tax write-off than invested.

Your actions may have serious consequences.

Through increased audits of promoters, improved information gathering and informing taxpayers on how to recognize tax schemes, the CRA continues to identify and shut down tax schemes.

Those who choose to participate in these schemes, as well as those who promote these schemes, face serious consequences, including penalties, court fines and even jail time.

What can you do to protect yourself and other taxpayers from tax schemes?

  • Get professional, independent advice before investing, especially if a deal seems too good to be true.
  • If you have participated in a scheme, come to CRA to correct your tax affairs through their Voluntary Disclosures Program … before they come to you.