Use this checklist if you were self-employed.
Use this checklist if you had rental income.
Hopefully, the year has treated you well. We will see several changes happening in 2020; some affecting personal income tax and some effecting business taxes.
Please take the time to read through the next page of income and deductions. Use these as a guideline when assembling your information for me.
I have included a checklist for proprietorships for everyone who was self-employed in the past year and a checklist for rental expenses for those with rental income in the past year. If you need a copy of either checklist, give me a call and I can e-mail or fax one over to you.
Some income tax information to consider:
Personal tax brackets (Provincial and Federal), personal exemption and other tax credits (Age, Dependent and others), have been adjusted up for inflation.
For 2020 the basic personal amount for federal tax will be increased ($931) for 2020, a savings of $ 140 in tax. This increase also affects eligible dependent amounts available for claim. This increased deduction will be reduced based on income for individuals between $ 150,474 and $ 214,368 and removed for individuals above this amount.
Further scheduled increases of the federal basic personal exemption of $579, $590 and $602 are scheduled for 2021-2023. No additional adjustment for inflation for this tax credit over the 2020-2023 period.
This year is unusual in that the first 60 days for the RRSP deadline ends on March 2, 2020. This is because the 60-day calculation ends on weekend; so the deadline is pushed to the next weekday.
The standard tax filing deadline (Interest start date for proprietorships owing tax or CPP) will be April 30, 2020. The self-employed filing deadline normally is June 15, 2020. The first day of e-file is February 18, 2020.
Tax-Free Savings accounts (TFSAs) – The 2020 additional contribution room is $6,000. If you have not made any TFSA contributions to date, your total contribution room would be $69,500. If you have made TFSA contributions in the past, please contact me to find out your current limit. Any withdrawals made in 2019 from your TFSA will increase your 2020 limit available.
On November 21, 2018, the federal government announced changes to the capital cost rates able to be deducted in the year of purchase. The new rate is three times the normal rate in the year of purchase. This results in a larger deduction being available in the year of purchase-related to additions after November 20th, 2018. These rules apply for years up to 2028.
The start of significant changes to CPP maximum and contribution rates continues January 1, 2020. The changes are fairly uniform in the phase-in period so you will not notice a large change in each year. In 2020 contribution rate rises from 5.1% to 5.25% and the maximum increases to $58,700. (Employee contributions increase of $ 149.10 over the last year)
BC electric vehicle incentives are available until March 31, 2020 (or available fund exhausted), Federal incentives have no expiry date or cap. BC Hydro also has a program related to rebates for electric vehicle chargers.
In August 2019 legislation on shared custody was defined to be at least 40% of the time for purpose of child tax payments. Retroactive payment requests can be made back to June 2011. (or up to 10 years from the application date whichever is less)
BC child benefit is scheduled to be enhanced on October 1, 2020, this will allow for the benefit to continue past age 6. The new provision continues up to age 18 and starts at $ 1,600 for the year for first child [1000 (second) 800 (subsequent)] Benefit is reduced by family income starting at 25K (4% reduction base on income above this)
In 2020 new digital subscription tax credit (15% of the amount paid to qualified Canadian Journalism Organization) (2020-2024) up to $500 in qualifying subscriptions can be claimed in 2020 for the tax credit.
If you have any questions, please do not hesitate to contact me. I look forward to meeting with you in 2020.