TheΒ  Blog

Here you will find a collection of my writings on all things Finance & Canadian Tax, Career, & Leadership.

Quick & Dirty Update - Federal Budget 2024

canadian tax canadians Apr 17, 2024

Many Canadians don't follow the tabling of the Federal Budget closely, but really should.

Sharing a high-level summary of some of the key changes that may impact a larger base of Canadians.

I like to keep things as non-technical as possible, so here you go!

One key area that I was waiting to hear on was the amount of the Canada Disability Benefit that will be distributed this year. Sadly, we landed at a benefit of $200 per month which will not be enough to solve the problem of many disabled Canadians living below the poverty line. If you have followed me for a while, you know that I am a loud advocate in this space.

🏘 Next up, housing.

⚫ RRSP withdrawal limit will increase from $35,000 to $60,0000 (starting 2024)
⚫ Repayment to begin in year 5 versus year 2 (withdrawal between January 1, 2022, and December 31, 2025)
⚫ First-time home buyers now will have access to 30 year amortization mortgages. (Starting Aug 1, 2024)
⚫ Secondary Suite Loan Program, up to $40,000 in low-interest loans to add secondary suites to their homes starting in 2025-26. 

πŸ’° "Tax the rich"
⚫ Capital gains above $250,000 will now have an inclusion rate of 2/3, up from 1/2. For 2024, impacted Canadians who dispose of assets prior to June 25, 2024 and after will be subject to 2 different inclusion rates. (let's hope this doesn't stifle investment in Canada, specifically the startup community)

⚫ Additional capital gains incentives for entrepreneurs, increased Lifetime capital gains exemption and the Canadian Entrepreneurs Incentive.

πŸ“ Administrative changes, likely to combat the wave of "taxes are illegal and I'm not paying" that is happening in the country right now, numerous administrative processes have been put into place.

⚫ Introduction of the “notice of non-compliance” that will impose a penalty on a person who’s been issued this document, amending the Act to allow the CRA to include a requirement that any required information (oral or written) or documents be provided under oath or affirmation, compliance orders with significant penalties, and preventing the stopping of the reassessment limitation clock!

⚫ Enhancement to an anti-avoidance rule already in place,  it would apply where there’s been a transfer of property from a tax debtor to another person at arm’s length to the tax debtor as a single transaction or as part of a series of transactions before being transferred to a person who isn’t at arm’s length with the tax debtor. 

⚫ The government intends to remove the general penalty provision for the failure to file an information return in respect of a reportable or notifiable transaction under the mandatory disclosure rules. This amendment would be deemed to have come into force on June 22, 2023

Also, enhancements to the Volunteer Firefighter Credit, CCB, CPP top up at death, and more. 

Now would be a great time to get with your financial advisors if any of the above impacts you, particularly capital gains. I expect to see share sell-offs ramp up before June 25th.


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