Gary S. Aslett Professional Corporation

• Personal Income Tax Rates: There have been no changes to the personal income tax rates in Ontario for 2022
• The tax brackets have been adjusted for inflation
• The top Ontario personal income tax rates for 2022 on income in excess of $220,000 {$220,000 is the start of the top bracket for Ontario provincial tax} are: Salary, interest and other income taxed at regular rates 53
• 53% Capital gains 26
• 77% Dividends ‘eligible’ for the enhanced tax credit 39
• 34% Non-eligible dividends 47
• 74% Personal Income Tax Rates:
• Salary, interest and other income taxed at regular rates
• Dividends ‘eligible’ for the enhanced tax credit
• Charitable Donations Credits: For an individual resident in Ontario, the tax credit for charitable donations is as follows: 20
• 0% on the first $200 of charitable donations
• 46
• 4% on charitable donations in excess of $200
• 50
• 4% on charitable donations in excess of $200 to the extent the individual has taxable income exceeding $221,708 (that is, the taxpayer has income subject to the top federal personal income tax rate)
• Instead of cash donations, there is no capital gains tax payable on accrued capital gains if publicly listed securities are donated in-kind to eligible charities
• 20
• 0% on the first $200 of charitable donations
• 46
• 4% on charitable donations in excess of $200
• 50
• 4% on charitable donations in excess of $200 to the extent the individual has taxable income exceeding $221,708 (that is, the taxpayer has income subject to the top federal personal income tax rate)
• Medical Expenses: Medical expenses paid in the year (which have not been reimbursed or covered by a medical insurance plan) can be claimed if they exceed the lesser of two amounts: 3% of your net income or, $2,479
• 00
• In Ontario, the claim results in a tax credit of approximately 20% of the amount claimed in excess of the threshold
• Taxpayers can refer to the CRA Income Tax Folio S1-F1-C1 which lists eligible expenses
• As a reminder, most pharmacies can provide a list of prescriptions paid during the year
• Automobile Limits: The following limits are effective for 2023 for residents of Ontario: Automobile allowance rates: 68 cents/km for the first 5,000 km, then 62 cents
• Maximum capital cost for capital cost allowance: $36,000
• 00 plus HST for 2022
• Deductible lease cost limit: $950
• 00/month plus HST
• {An additional restriction may apply where the value of the vehicle exceeds the $36,000
• 00 ceiling
• } Other limits may apply for zero-emission vehicles or, automobile salespersons
• Automobile allowance rates: 68 cents/km for the first 5,000 km, then 62 cents
• Maximum capital cost for capital cost allowance: $36,000
• 00 plus HST for 2022
• Deductible lease cost limit: $950
• 00/month plus HST
• {An additional restriction may apply where the value of the vehicle exceeds the $36,000
• 00 ceiling
• }
• Other limits may apply for zero-emission vehicles or, automobile salespersons
• Important Reminders: Tax Instalments: CRA will issue instalment reminders if your personal tax owing in the prior calendar year (before reflecting instalments paid for that year) exceeded $3,000
• 00
• Instalment reminders are usually sent by CRA in February (for the March 15 and June 15 instalment) and August (for the September 15 and December 15 instalment)
• Interest (and possibly penalties) will apply if instalments are paid late
• If you expect your current year's taxes payable to be less than the prior year, you may base your instalments on the estimated tax payable, however, interest will be charged if your estimate is too low
• Foreign Reporting Form: Given the significant penalties for failure to submit these forms on time, this is a reminder that separate tax forms must be filed with CRA by the due date for filing your income tax return if you own certain foreign property or foreign investments with a combined cost exceeding $100,000 CAD at any time during the year
• Sale of Principal Residence: Prior to 2016, CRA's administrative position did not require reporting the sale of a principal residence when there was no gain to include in income
• You are now required to report on Schedule 3 and form T2091 (Designation of a Property as a Principal Residence by an Individual) on your personal income tax return the sale of a principal residence, even if the gain is fully exempt
• Taxpayers failing to report this information may not be eligible to claim the principal residence exemption
• Tuition Credits: If you have paid post-secondary tuition, please visit the school's website to download the official T2202 tuition tax credit form
• If you paid tuition to post-secondary schools outside Canada, you will require form TL11A to be completed by that school
• Statements of account or other fee receipts cannot be used to claim tuition tax credits - only form T2202 and TL11A are acceptable
• Tax Instalments: CRA will issue instalment reminders if your personal tax owing in the prior calendar year (before reflecting instalments paid for that year) exceeded $3,000
• 00
• Instalment reminders are usually sent by CRA in February (for the March 15 and June 15 instalment) and August (for the September 15 and December 15 instalment)
• Interest (and possibly penalties) will apply if instalments are paid late
• If you expect your current year's taxes payable to be less than the prior year, you may base your instalments on the estimated tax payable, however, interest will be charged if your estimate is too low
• Foreign Reporting Form: Given the significant penalties for failure to submit these forms on time, this is a reminder that separate tax forms must be filed with CRA by the due date for filing your income tax return if you own certain foreign property or foreign investments with a combined cost exceeding $100,000 CAD at any time during the year
• Sale of Principal Residence: Prior to 2016, CRA's administrative position did not require reporting the sale of a principal residence when there was no gain to include in income
• You are now required to report on Schedule 3 and form T2091 (Designation of a Property as a Principal Residence by an Individual) on your personal income tax return the sale of a principal residence, even if the gain is fully exempt
• Taxpayers failing to report this information may not be eligible to claim the principal residence exemption
• Tuition Credits: If you have paid post-secondary tuition, please visit the school's website to download the official T2202 tuition tax credit form
• If you paid tuition to post-secondary schools outside Canada, you will require form TL11A to be completed by that school
• Statements of account or other fee receipts cannot be used to claim tuition tax credits - only form T2202 and TL11A are acceptable
• Canada Emergency Business Account ("CEBA") loans: The date for repayment of loans received under the CEBA program to qualify for partial loan forgiveness has been extended by one year from December 31, 2022 to December 31, 2023 for eligible borrowers

Canada Emergency Business Account ("CEBA") loans:

• Underused Housing Tax Filing ("UHT"): Effective for 2022, the Federal government has introduced a 1% tax on the value of vacant or underused residential property for certain owners
• (This is a separate reporting from those implemented by certain provinces and municipalities
• ) 'Excluded owners' (a defined term, including Canadian citizens or permanent residents) do not need to file the Federal UHT return
• If the owner is not an 'Excluded owner', certain owners (including Canadian private corporations with less than 10% foreign ownership) may still be eligible to can claim an 'Exemption' from the tax however, the owner of the residential property must still submit the UHT return even though no tax is owing
• The due date of this filing is April 30, with significant penalties assessed for late filings
• Copy the website address below to your browser for additional information: https://www
• canada
• ca/en/services/taxes/excise-taxes-duties-and-levies/underused-housing-tax
• html Underused Housing Tax Filing ("UHT"): Ontario Seniors Home Safety Tax Credit:
• Staycation Tax Credit: Ontario introduced a 20% tax credit on eligible 2022 short-term leisure accommodation expenses in Ontario (hotel, cottage, campground, vacation rental)
• Eligible expenses are capped at $1,000 for an individual (tax savings of $200) and, $2,000 for a family (tax saving of $400)
• Tax-Free First Home Savings Account ("FHSA"): This new first home purchase savings plan incentive is effective April 1, 2023 and is available to a first home buyer (as defined)
• Tax deductible contributions can be made in the amount of $8,000 annually, with maximum lifetime cumulative contributions of $40,000
• No income tax is payable on the income earned within the FHSA or, on 'qualifying' withdrawals from the plan to purchase a home
• Details of this new registered plan continue to be released as the implementation date approaches

Tax-Free First Home Savings Account ("FHSA"):

• Residential Property Flipping Rules: Effective for 2023, the government intends to release legislation such that profits from the disposition of residential property sold within 12 months of purchase will be fully included in taxable income as ordinary business income
• Profits will not be eligible for the 50% capital gains inclusion rate or the principal residence exemption
• There are a number of exclusions including the death of a taxpayer, breakdown of a marriage, serious illness or disability, eligible relocations for employment, and several other exclusions

Residential Property Flipping Rules: