SUMMER 2002 E-NOTES
To print the summer E-notes click here:
SUMMER 2002 NEWSLETTER
The recent Provincial Budget
did not provide any new tax relief for the average business owning taxpayer.
There was additional
discussion regarding the education credits for private school students but at this point
you cannot determine which private schools will qualify for the education tax credit.
STATUTORY (PUBLIC) HOLIDAYS
A reminder that the following
are public holidays in Ontario, Canada Day, Labour Day and Thanksgiving. Please note that
the Civic Holiday, August 5, 2002, is NOT a public holiday.
If your employee works any
public holiday they are entitled to either 2.5 times their regular pay or 1.5 times
their regular pay plus a day off with pay.
As mentioned previously the new Employment
Standards Act forces employers to pay public holiday pay to all employees,
effective upon their hiring. There is no longer a three month exemption upon hiring. Part
time employees receive public holiday pay based on their average daily hours
worked. For example, if you had an employee that worked one day per month for eight hours
that employee would be entitled to eight hours of pay every public holiday.
SUMMER OFFICE HOURS
As in previous years our office will be
closed on Fridays from May 31, 2002 until September 6, 2002. You will be able to leave a
confidential Voice -Tel message, which we review on a regular basis. Our office will be
open, as usual, from nine in the morning to five in the afternoon Monday to Thursday.
2001 PERSONAL TAX RETURNS
We wanted to thank our clients for
providing their personal tax information on a timely basis. Your efforts allowed us to
prepare and file all tax returns by the due date. In fact this tax season was the most
effective since our inception. Thanks.
We would appreciate receiving a copy of
your 2001 personal tax return assessment before September 2002 in order to assist with
your 2002 personal tax planning.
We also require your personal assessment
as all financial institutions demand copies of your personal assessments when reviewing
your business financing arrangements. As our office usually provides the
information required regarding the business the process would be much quicker if we had
our clients personal assessments on hand.
TAX FREE EMPLOYEE GIFTS
A reminder that Revenue Canada has changed
the rules regarding "tax free" employee gifts. Effectively an employer can
reward an employee with two non cash gifts per year, as long as the total value of the
gifts does not exceed five hundred dollars. These gifts can be in recognition of special
days such as birthdays, Christmas or marriage. The employer can also reward an employee,
following the same guidelines, as a bonus for work efforts (ie: years of service). Please
note that Revenue Canadas definition of non cash gifts does not include gift
A reminder that the foreign content
maximum for your RRSP programs has been increased to 30%. With the "staleness"
in the Canadian securities marketplace this may be a good time to review your portfolio
mix with your financial advisor.
The maximum RRSP earned deduction for 2002
and 2003 will remain at $13,500. This increases to $14,500 for 2004 and to $15,500 for
2005. For the 2006 and following taxation years this amount will be indexed.
A reminder that Revenue Canada requires
companies to keep their business records for a minimum of six years. This six year time
frame is specified in both the Income Tax Act and the Excise Tax Act (GST). These Acts
require the business to keep both source documents (ie: daily sales reports and tapes) and
computer records (ie: backup diskettes).
You may now start destroying your business
records for years ending January 1996 and earlier. Keeping all of your records for six
years also satisfies the Employment Standards Act requirement to retain all your payroll
records for a minimum of five years.
TELEPHONE LAND LINE COSTS
Several of our customers have negotiated
reduced business line rates with Bell Canada. These businesses are saving $10/month per
line simply by signing a two year contract with Bell Canada. The average small business
has five phone lines. This contract would result in $3,000 of savings in telco costs in
five years with no change in service.
Please note that this contract option is
not available in all areas due to your local Central Office location.
DEATH AND TAX PLANNING
Recently a new client passed away
suddenly. Our office was assisting in the reorganization of the family and business
structure in order to minimize the tax liabilities and probate fees upon the death of
either spouse. The changes suggested were not completed in time so the surviving family
members (estate) were out of pocket a significant amount of money unnecessarily.
Our suggestions are to review and update
your will, ensure that your company has sufficient insurance on the shareholders/owners
and that personal investments are held jointly by both spouses. After review you may need to
contact your lawyer and insurance agent.
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US | HOME
109 Industrial Dr., P.O. Box 295
Dunnville, Ontario. Canada N1A 2X5
Tel: (905) 774-2977
Fax: (905) 774-1096
After Hours: (905) 540-7006
Contren Management Consultants Inc. 1999. All Rights Reserved.