Tax Tips & Traps

This publication is a high-level summary of the most recent tax developments applicable to business owners, investors, and high-net-worth individuals.

TAX TIDBITS

• For 2023, the maximum amount that may be deducted for non-taxable allowances paid to an employee using a personal vehicle for business purposes has increased by 7₵ to 68₵/km for the first 5,000 KM driven and to 62₵ for each additional km. For Yukon, the Northwest Territories, and Nunavut, the tax-exempt allowance will continue to be 4₵/km higher.

• Rapid inflation has resulted in a significant increase of 6.3% in personal income tax and benefit amounts for 2023. For example, the income level at which OAS repayments commence is now $86,912 (from $81,761), the capital gains exemption for the sale of certain small businesses is now $971,190 (from $913,630), and the annual TFSA contribution limit has increased to $6,500 (from $6,000).

• Legislation that requires more trusts to file trust returns and more information to be disclosed has been enacted. The commencement date was recently deferred by a year to apply to fiscal years ending on or after December 31, 2023. These filing requirements include bare trust arrangements, such as in-trust bank accounts that a parent or grandparent may have with their child or grandchild unless a specific exception applies.

Please see the linked commentary for more details on these items.