Here is what you need to know about the latest moves by the federal government as it pertains to the tax code. Originally published on the Mortgage Professionals Canada website, the following article summarizes the proposed changes and outlines how you can make your voice heard. 

Tax Code Update

Federal Finance Minister Morneau announced the launch of consultations aimed at implementing tax code changes to tax planning strategies involving the use of private corporations. If your business is privately incorporated you may be impacted by the proposed changes.

The Rationale

The government feels that making changes to the way some Canadians use the small business tax rules will improve the fairness of Canada’s tax system because “many of the richest Canadians are unfairly exploiting the tax rules designed to help businesses thrive.” The government has launched consultations, with an October 2, 2017 deadline specifically on amending the following three tax practices that are, from the government’s perspective, being used to gain unfair tax advantages:

More information on these specific measures and proposals can be found in the Technical Briefing Deck: Tax Planning Using Private Corporation.

Mortgage Professionals Canada will be assessing the proposals in more detail and will provide materials to assist members with their own submissions.

If you feel you may be impacted by these changes, we encourage you to submit a letter through the public consultation process by the October 2 deadline and immediately contact your Member of Parliament to obtain more information about what this means for you.

The government lays out these proposals in more detail and invites public input in their White Paper. Written comments may be sent directly to fin.consultation.fin@canada.ca.