Author: VeritaxTeam

Now that most of us have filed our personal income tax returns, many of us are waiting for our tax refunds from CRA. Last year, close to 60% of tax filers received refunds. Are tax refunds good or bad? A tax refund is a sign that you paid through your employer more income tax during the year (or remitted more tax installments, in the case of self-employed people), than what you are supposed to. It's like giving CRA an interest-free loan. Many people don't realize that he or she can request his or her employer to reduce the tax withheld on salary, by completing the TD1 forms (federal and province). Income taxes at source can be adjusted based on the amount of personal credits the client will claim on his or her tax return. Receiving a tax refund provides some instant satisfaction - for many people, it's extra money - a cash windfall - to spend, to invest or to pay a loan. But, had...

The CRA has announced an increase in the prescribed interest rates for amounts owing in the Second Quarter of 2018, with the basic rate rising from 1% to 2%. The prescribed rate increase had been expected since January when the Bank of Canada raised its overnight rate. It’s the first increase since the prescribed rate dropped to 1% at the start of 2014. The prescribed rate is determined quarterly by a formula in the Income Tax Regulations that calculates the average of three-month Government of Canada Treasury yields for the first month of the preceding quarter. The following rates will be in effect April 1 to June 30: 6% on overdue taxes, CPP contributions and employment insurance premiums (up from 5% in Q1) 2% on corporate taxpayer overpayments (up from 1% in Q1) 4% on non-corporate taxpayer overpayments (up from 3% as Q1) 2% on taxable benefits for employees and shareholders from interest-free and low-interest loans (up from 1%) 5.18% for corporate taxpayers’ pertinent loans or indebtedness (up...