November 23, 2017 by Nadia Pulla, Salome Victor
Topics include:
September 28, 2017 by John S. Lee
On September 27, 2017 the Republican Party released their long anticipated proposal for U.S. tax reform. The key takeaways of the framework have been summarized below. Please contact your local Collins Barrow U.S. tax advisory professional if you have any questions and to find out how these proposals may impact you and your U.S. or cross-border business.
September 27, 2017 by Ralph Neate
From an investment perspective, mutual funds and exchange-traded funds (ETFs) make sense for many Canadians. They allow them to reduce investment risk by diversifying their holdings through exposure to multiple industries and sectors of the economy, without the need to hold many individual stocks and bonds.
September 13, 2017 by Stephen Rupnarain
An earlier version of this Tax Flash was originally published on May 11, 2017. The following version has been amended to reflect important updates as of Sept. 8, 2017.
As proposed in the March 22, 2017 budget, every professional must include year-end work-in-progress (WIP) into taxable income effective for taxation years beginning after March 21, 2017. WIP for professionals typically represents unbilled professional time and cost incurred in the rendering of services to clients. This is often captured in the form of a professional’s “charge-out” rate, which represents their cost, overhead and some profit component.
June 12, 2017 by Rainer Vietze
Canada has over 90 bilateral tax treaties and over 20 bilateral Tax Information Exchange Agreements in force, with at least a dozen more treaties or agreements in the negotiation stage. This fact alone highlights the importance such agreements play on the global tax stage. Not surprisingly, Canadian multinationals and Canadian subsidiaries of foreign multinationals have long understood the impact tax treaties may have on how their cross-border intergroup transactions will be taxed.
May 25, 2017 by Matthew Wilson
Canadians with business or personal interests in the United States and American citizens living in Canada may want to take a renewed look at the fast-changing tax environment south of the border. Tax reform was one of the key planks in Donald Trump’s election platform, although it’s unclear how many of these ideas he’ll be able to implement. It would be prudent to consider some possible implications for your business, your family and yourself.
Of course, any steps you take depend on your personal circumstances and they should be taken only after consultation with a qualified business professional. But in broad strokes, here are some ideas to consider.
May 11, 2017 by Stephen Rupnarain
This information is current to May 11, 2017. Please refer here for an updated version of this Tax Flash.
As proposed in the March 22, 2017 budget, every professional must include year-end work-in-progress (WIP) into taxable income effective for taxation years beginning after March 21, 2017. WIP for professionals typically represents unbilled professional time and cost incurred in the rendering of services to clients. This is often captured in the form of a professional’s “charge-out” rate, which represents their cost, overhead and some profit component.
March 9, 2017 by Mariya Honcharova
In April 2016, the Minister of National Revenue established the Offshore Compliance Advisory Committee (“OCAC”) for the purpose of advising the Minister and the Canada Revenue Agency (“CRA”) on administrative strategies to deal with offshore compliance. In the fall of 2016, OCAC issued a report on CRA’s Voluntary Disclosure Program, which was endorsed by the Minister of National Revenue on December 8, 2016. On February 22, 2017, the CRA released its formal response, in which it indicated that the review of the recommendations prepared by OCAC will be completed by March 31, 2017.
March 6, 2017 by Kevin Tippett
*Updated March 10, 2017
With increasing frequency, Canadian corporations are venturing across the border into the United States to perform services or sell their products. Consequently, we often field questions about the U.S. corporate income tax filing requirements for Canadian corporations generating revenue from our trading partner to the south. This article summarizes some of those requirements.
March 6, 2017 by Jason Melo
It is not uncommon for recently graduated medical professionals to take up employment in the United States immediately upon completion of their education and practical experience requirements. Those who maintained Canadian residence for tax purposes during the pursuit of their education have likely accumulated a significant tuition credit, given the time and financial commitment involved. The corresponding Canadian tuition/education tax credit is largely calculated by multiplying total tuition fees paid by the lowest federal (15%) and provincial marginal tax rates (5.05% in Ontario). The result of this calculation is used to reduce annual personal income taxes on a dollar-for-dollar basis.
February 8, 2017 by Mike Hayward, Todd King
In recent months, there have been rumblings that the streamlined program — a “friendly” system that helps U.S. taxpayers living abroad get caught up on their filing obligations — is coming to an end. If you are an American citizen or Green Card holder who hasn’t been filing American taxes, now is the ideal time to get caught up, as you may be running out of time to avoid harsh penalties.
If you do business or have branches in both Canada and the United States, there’s one big tax challenge that’s impossible to ignore: U.S. corporate tax rates are generally higher than Canadian rates.
Topics include:
*Updated on January 4, 2017
November 14, 2016 by Darlene Shaw
Canada Revenue Agency (CRA) has unexpectedly concluded that U.S. limited liability partnerships (LLPs) and limited liability limited partnerships (LLLPs) share more of a likeness with Canadian corporations than they do with Canadian partnerships. Thus, the tax implications for these entities have shifted and financial strategies for Canadian investors with a stake in such partnerships must change.
November 8, 2016 by Crystal Wu, Maggie Mei
In an effort to minimize taxpayers’ timing difficulties with filing dates for several common types of returns and reporting forms, the United States Congress has passed legislation modifying the original and extended due dates for tax years beginning after December 31, 2015 (i.e. 2016 returns filed during the 2017 filing season). Click here to view a table that summarizes the old due dates under prior law and the new due dates for some of the most common returns for taxpayers with a calendar tax year-end and C corporations with a fiscal tax year-end.
November 8, 2016 by Shelley Smith
U.S. Individual Taxpayer Identification Numbers (ITINs) are required by the IRS if you have U.S. tax reporting obligations and you are not eligible for a U.S. Social Security Number (SSN). This requirement normally applies to Canadians who have some source of U.S. income that must be reported to the IRS. Unfortunately, these ITIN numbers are not permanent and will expire as early as January 1, 2017. In fact, individuals having ITINs with 78 or 79 as the fourth and fifth digits (e.g. 9XX-78-XXXX or 9XX-79-XXXX) can expect to receive notice from the IRS this fall advising that their ITIN will expire on January 1, 2017. (To distinguish ITINs from SSNs, note that ITINs begin with the number 9.)
July 27, 2016 by Denver Nicklas
With an increasingly global farm commodity market and a lower Canadian dollar, Canadian farmers are finding it much easier to sell their products in the United States. However, it is important that producers are aware of potential U.S. tax issues and filing requirements, particularly if this is common practice on their farm operation.
June 10, 2016 by Todd King
The past several years have been a wild ride for many U.S. taxpayers (and tax practitioners), in particular for those residing outside of the country. While there are a surprising number of U.S. persons still grappling with becoming compliant, in general, the progression to considering expatriation has been somewhat predictable, as follows.
On April 4, 2016, the U.S. Treasury Department and the IRS issued proposed regulations which govern whether certain related-party debt instruments will be classified as either debt or equity for U.S. federal income tax purposes. These rules are designed to prevent the excessive shifting of profits between related entities by way of interest charges on related-party debt instruments.
June 8, 2016 by David Kemp
It seems that every day now there is an article of some sort addressing aggressive tax structures, often utilizing offshore entities, and the ramifications of (implied) inappropriate, underlying transfer pricing policies. Recently, this has clearly been due to the news of the “Panama Papers” disclosure or, more generally over the past couple of years, the result of the recently finalized Base Erosion and Profit Shifting Project reforms published by the Organisation for Economic Co-operation and Development.