CRA Update for November 2018

Personal Tax

2019 Personal Tax Rate Tables

The 2018/2019 tax rate tables are now available, showing the combined federal and provincial/territorial tax rates for capital gains, both types of Canadian dividends and other income.  

2019 Dividend Tax Credit Rates for Non-Eligible Dividends

The gross-up rate is reduced to 15% in 2019 from 16% in 2018 and the dividend tax rate is changed for many provinces.  Rates could still change when 2019 budgets are tabled.

Financial Planning / Registered Plans / Investing

Tax-Free Savings Account (TFSA) Withdrawals

When a withdrawal is made from a TFSA, the withdrawal amount is added back to your contribution room in the following year.  If you're considering a withdrawal in the next several months, do it before Dec 31st so it increases your contribution room in January.

2019 TFSA Contribution Limit

The TFSA contribution limit for 2019 will be $6,000, up from $5,500 in 2018.

Conversion of RRSP to RRIF - Partial Conversion Prior to Age 71

By converting some of your RRSP to a RRIF in the year you turn 65, you can take advantage of the pension income tax credit and pension income splitting with your spouse.  

Seniors

Old Age Security (OAS) Claw-back

If you have capital losses carried forward and unrealized capital gains and are not going to be collecting your OAS pension for a year or so yet, you may be able to do something now to avoid or reduce an OAS claw-back in the future.  Are you a high-income earning earner about to apply next year for your OAS, with a reduced income?  Plan ahead!

Legislation / Budgets

Bill C-86, Budget Implementation Act, 2018, No. 2

Bill C-86 was tabled on October 29, 2018 by the federal government.  It includes many provisions, including those regarding charities and non-partisan political activities, allowing CRA to calculate the new Canada Workers Benefit if a tax filer has not claimed it, extending the income tax reassessment period in a few different situations, and many other measures.

Federal Fall Economic Update

The federal government will present their fall economic update on November 21, 2018.

Ontario Fall Economic Update

The Ontario Finance Ministry website indicates a Fall Economic Outlook and Fiscal Review is released annually on or before November 15.

The Tax experts at Copetti & Co can help you understand the implications of these changes. Call today!