Personal Finance

Tax time! I'm a public accountant, so ask me, I'll try to respond frequently

  • Last Updated:
  • May 13th, 2018 12:33 pm
Newbie
Jan 13, 2011
33 posts
5 upvotes
Scarborough
I did something really stupid and over contributed to my TSFA. What happened was I made 2016 year end withdrawal on one of my accounts with the intention of depositing the money back again the next year at a different institution. But I didn't realize the trades settled in 2017, which I'm guessing means the withdrawal would have occurred in 2017 and not 2016. I didn't notice until an entire year later when I was checking how much I can deposit into my TSFA for 2018. The total over contribution amounted to $10,000 and at 1% penalty each month, it's a $1200 fee for the year. Any way I can reduce this penalty? I haven't received any notices or bills from the CRA yet about my over contribution but I'm guessing it'll be coming sometime in the future?
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User avatar
Apr 29, 2008
5931 posts
1626 upvotes
Montreal
exsen wrote:
Jan 5th, 2018 12:01 pm
I did something really stupid and over contributed to my TSFA. What happened was I made 2016 year end withdrawal on one of my accounts with the intention of depositing the money back again the next year at a different institution. But I didn't realize the trades settled in 2017, which I'm guessing means the withdrawal would have occurred in 2017 and not 2016. I didn't notice until an entire year later when I was checking how much I can deposit into my TSFA for 2018. The total over contribution amounted to $10,000 and at 1% penalty each month, it's a $1200 fee for the year. Any way I can reduce this penalty? I haven't received any notices or bills from the CRA yet about my over contribution but I'm guessing it'll be coming sometime in the future?
You can try asking for a waiver.
It can help to contact them before they contact you.
http://www.moneysense.ca/columns/apply- ... penalties/

207.06

(1) If an individual would otherwise be liable to pay a tax under this Part because of section 207.02 or 207.03, the Minister may waive or cancel all or part of the liability if

(a) the individual establishes to the satisfaction of the Minister that the liability arose as a consequence of a reasonable error; and

(b) the individual acts without delay to cause one or more distributions to be made, under one or more TFSAs, the total amount of which is not less than the amount in respect of which the individual would otherwise be liable to pay the tax.
Jr. Member
Apr 6, 2013
171 posts
64 upvotes
Edmonton
I was living in a house and moved out this year, but I kept it as a rental property. After I moved out but before I found a tenant I completed a few maintenance items on the house. Can I claim these as maintenance costs? What day does the property officially become a rental property?

Thanks!
Newbie
Oct 23, 2006
57 posts
1 upvote
cashinstinct wrote:
Jan 4th, 2018 9:00 pm
Yes it does in my experience as parent for Quebec child support.

For child care, are you talking
1) about a non-subsidise place and you get a tax credit from quebec
2) a $8 place that you might pay extra on your tax return depending on income?
Thanks for the detailed and comprehensive response.

I was only referring to #1 a non-subsidized place to which you addressed.

Thx
Last edited by hellohello on Jan 5th, 2018 1:14 pm, edited 1 time in total.
Newbie
Oct 23, 2006
57 posts
1 upvote
I am thinking of investing in dividend producing stocks for my children but am concerned that it will decrease child allowance significantly as I understand, dividend income is grossed up and even though net tax is approx same however family income remains higher by the tax gross up amount (could be 38%?) and since child allowance is dependent upon family income.....

any thoughts?
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User avatar
Apr 29, 2008
5931 posts
1626 upvotes
Montreal
hellohello wrote:
Jan 5th, 2018 1:18 pm
I am thinking of investing in dividend producing stocks for my children but am concerned that it will decrease child allowance significantly as I understand, dividend income is grossed up and even though net tax is approx same however family income remains higher by the tax gross up amount (could be 38%?) and since child allowance is dependent upon family income.....

any thoughts?
did you max out their RESP yet? Put the dividend producing stocks in their RESP.
Newbie
Oct 23, 2006
57 posts
1 upvote
cashinstinct wrote:
Jan 5th, 2018 2:04 pm
did you max out their RESP yet? Put the dividend producing stocks in their RESP.
yes we are RESP maxed out but thx for the idea.
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Nov 19, 2004
7754 posts
1192 upvotes
Cambridge, ON
chaporion wrote:
Jan 5th, 2018 12:27 pm
I was living in a house and moved out this year, but I kept it as a rental property. After I moved out but before I found a tenant I completed a few maintenance items on the house. Can I claim these as maintenance costs? What day does the property officially become a rental property?

Thanks!
You can only have one principal residence, so it is up to you when you deemed the house a rental vs your principal residence. Upon deeming it rental, you should have an appraisal so you know the value at that time since down the road when you sell it, you will have to declare the gains. Any maintenance to a rental can be claimed or CCA (depending what is being done).
Newbie
Nov 11, 2015
66 posts
Toronto, ON
Sorry if this is a really basic tax question/if my thinking is completely wrong lol but I have no clue about how taxes work and it will be my first year owing (used tuition credits last year).

I'm estimating (through various online tax calculators) that I will owe about 2k in taxes this year. Do you know if OSAP interest paid works in the same way my tuition credits did? And also I don't have an RRSP but if I put 2k into my RRSP does that mean I don't owe any taxes (not quite sure how RRSP works with taxes)?

Thank you!!
Deal Addict
User avatar
Aug 3, 2009
1712 posts
253 upvotes
Nova Scotia
Hello, for a professional licensing fee deduction would it be claimed in the year invoiced or the year paid? Thanks.
Jr. Member
Mar 6, 2011
161 posts
27 upvotes
My employer reimburses 50% of my university tuition. This is to take courses related to my job, so my understanding is that makes it a non-taxable benefit. But when it comes to the education amount (line 323) I'm not sure if:
1. I can claim the full education amount
2. I can only claim 50% of the education amount (the portion not reimbursed by my employer) OR
3. I cannot claim any education amount
Deal Addict
Aug 30, 2011
2913 posts
707 upvotes
Ottawa
robyn1990 wrote:
Jan 5th, 2018 3:13 pm
Sorry if this is a really basic tax question/if my thinking is completely wrong lol but I have no clue about how taxes work and it will be my first year owing (used tuition credits last year).

I'm estimating (through various online tax calculators) that I will owe about 2k in taxes this year. Do you know if OSAP interest paid works in the same way my tuition credits did? And also I don't have an RRSP but if I put 2k into my RRSP does that mean I don't owe any taxes (not quite sure how RRSP works with taxes)?

Thank you!!
RRSP contributions are a deduction from income, not taxes. So, it will reduce your income by $2,000, but your taxes will only be reduced by the amount of tax owing on that same $2,000. Hope that is clear ;)

OSAP interest is claimed as a non-refundable tax credit, and is not a deduction from income. Read ... https://www.canada.ca/en/revenue-agency ... loans.html
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Nov 19, 2004
7754 posts
1192 upvotes
Cambridge, ON
dtaylorl wrote:
Jan 5th, 2018 4:20 pm
My employer reimburses 50% of my university tuition. This is to take courses related to my job, so my understanding is that makes it a non-taxable benefit. But when it comes to the education amount (line 323) I'm not sure if:
1. I can claim the full education amount
2. I can only claim 50% of the education amount (the portion not reimbursed by my employer) OR
3. I cannot claim any education amount
You can't claim any amounts that have been reimbursed.
Jr. Member
Mar 6, 2011
161 posts
27 upvotes
don242 wrote:
Jan 5th, 2018 7:39 pm
You can't claim any amounts that have been reimbursed.
So 2 then? Or 3?
And if I understand correctly I can't claim the textbook amount for that portion either, even though my employer reimburses tuition but not textbook expenses?
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User avatar
Nov 19, 2004
7754 posts
1192 upvotes
Cambridge, ON
dtaylorl wrote:
Jan 6th, 2018 1:36 pm
So 2 then? Or 3?
And if I understand correctly I can't claim the textbook amount for that portion either, even though my employer reimburses tuition but not textbook expenses?
I should clarify. You can't claim the amounts reimbursed, only the part out of your pocket (so #2) . However, if the employer added the reimbursed amount to your income as a taxable benefit, then you would claim the full amount. Normally an employer won't show reimbursed tuition as a taxable benefit, but some may.

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