- March 15, 2017
- Posted by: Harpreet
- Category: Tax Tips
Canadian Budget Expectations 2017
Did you know that the 2017 Federal Budget is releasing on March 22, 2017? Some of the budget expectations that are being speculated can have a huge impact on your taxes. Below are a few of the areas under scurrility:
Capital gains taxation
- Currently, only 50% of capital gain is included in income. There is a lot of speculation that the budget will increase this to 75% (hence making only 25% tax free).
- This change will impact those with investment properties looking to sell or investments in non-registered accounts.
- This will also impact those businesses who currently use the Capital dividend accounts
- The last time the capital gains rate was changed was in Oct 2000 (which was changed from 75% to 50%)
Small business deduction crackdown
- There are rumours that additional restrictions will be placed on small business deduction, which essentially implies $500,000 of active income is taxed at 15%. One such restriction rumoured is putting an eligibility requirement of having a minimum number of employees employed to be able to claim the 15% tax rate.
- This will have a tremendous impact on all small owner managed businesses
Additional support and assistance under the Home Buyers plan
- There is speculation that the home buyers plan regime will be expanded to provide additional support for those that have lost a loved one, are relocating jobs, facing martial breakdown and those who are caring for an elderly etc.
This will be a welcome change if made!
Basic tax Credits
- Budget 2016 focused on middle class and reducing the taxes paid overall The Liberal government is looking at ways to provide additional relief to the middle class by eliminating the Age amount, the Canada employment amount and the public transit amount.
Will these changes be retroactive or prospective? Keep a watch on our webpage or on our facebook page for full details and coverage next week March 22nd