TAX ALERTS

JUNE AND SEPTEMBER INDIVIDUAL INCOME TAX INSTALMENT PAYMENTS DUE BY SEPTEMBER 30, 2020

Canadian taxpayers who pay income tax by instalment usually make four instalment payments each year, by the 15th day of March, June, September, and December.

Earlier this year, the federal government announced that the deadlines for payment of the June and September instalments would be deferred. Both of those instalment payments are now due on or before Wednesday September 30, 2020.

Where such payments are not made in full by the September 30 deadline, interest charges may be imposed. Details of the instalment payment system, and how payments can be made, are available at https://www.canada.ca/en/revenue-agency/services/tax/individuals/topics/about-your-tax-return/making-payments-individuals/paying-your-income-tax-instalments.html.

INDIVIDUAL TAX BALANCES FOR 2019 TAX YEAR DUE BY SEPTEMBER 30

Earlier this year, the Canada Revenue Agency (CRA) announced that the deadline for payment of individual income tax balances for the 2019 tax year, which is usually April 30, was being extended to Wednesday September 30, 2020. Where such balances are paid on or before that date, no interest charges or penalties will be imposed.

In addition, while the return filing deadline for individual income tax returns for 2019 was June 1 for most taxpayers (June 15 for self-employed individuals and their spouses), the CRA's policy is that no late-filing penalties will be levied where such returns are filed on or before September 30, 2020.

https://www.canada.ca/en/revenue-agency/campaigns/covid-19-update/covid-19-filing-payment-dates.html#extend.

UNEMPLOYMENT RATE DECREASES TO 10.2% FOR AUGUST

The September release of Statistics Canada's Labour Force Survey shows that the overall unemployment rate for the month of August stood at 10.2%. That rate represented a decrease of 0.7% from the rate recorded for the month of July.

Employment rose during the month by 246,000 jobs. That figure, when combined with gains made in the previous three months, brought employment to within 1.1 million of the pre-pandemic level recorded for February 2020.

https://www150.statcan.gc.ca/n1/daily-quotidien/200904/dq200904a-eng.htm?HPA=1&indid=3587-2&indgeo=0.

INCREASE ANNOUNCED TO NON-TAXABLE MEAL ALLOWANCE RATE

The federal government has announced an increase in the amount of any overtime meal allowance, or meal portion of a travel allowance, that employers can provide to employees on a non-taxable basis. That increase, the first since 2009, raises the per meal amount from $17 to $23. The change (from $17 to $23) also applies to the rate at which transport employees and others can claim meal expenses under the CRA's flat rate (simplified) claim system.

https://www.canada.ca/en/revenue-agency/news/2020/09/canada-revenue-agency-increases-flat-rate-amount-for-meal-claims-and-reasonable-amount-for-meal-benefits-and-allowances.html.

FILING OF 2019 TAX RETURN NECESSARY TO ENSURE CONTINUED PAYMENT OF TAX CREDITS

Eligibility for a number of refundable tax credits and benefits, including the harmonized sales tax/goods and services tax credit and the child tax benefit is based in part on a taxpayer's income for the previous year, as reported on his or her tax return. The current benefit year for such credits runs from July 1, 2020 to June 30, 2021, with benefit entitlement based on income for 2019.

Earlier this year, the Canada Revenue Agency (CRA) announced that benefit payments would continue past June 30, 2020, even where taxpayers had not yet filed a return for 2019 (such returns were, for most taxpayers, due by June 1, 2020).

https://www.canada.ca/en/revenue-agency/news/newsroom/tax-tips/tax-tips-2020/last-call-file-your-2019-tax-return-keep-getting-your-benefit-payments.html.