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What the CRA Said
Supporting Affordable Housing: Apply Now for the GST/HST Rebate for Purpose-Built Rentals
Supporting affordable housing: apply now for the GST/HST rebate for purpose-built rentals
The Canada Revenue Agency (CRA) has announced a new initiative to support affordable housing across Canada by providing a 100% rebate on the Goods and Services Tax (GST) or the federal portion of the Harmonized Sales Tax (HST) for new purpose-built rental housing (PBRH). This initiative aims to address the housing needs of various demographics, including students, families, seniors, and newcomers, who are struggling to find affordable rental homes.
Eligibility and Application:
Starting May 13, 2024, applications for the PBRH rebate can be made online. To qualify, residential units must meet the requirements for the current GST/HST new residential rental property rebate and be part of a multi-unit residential complex with at least:
- 4 private apartment units, each containing a kitchen, bathroom, and living area, or
- At least 10 private rooms or suites.
Additionally, 90% of the residential units must be held for long-term rental purposes. Unlike the existing GST/HST new residential rental property rebate, the PBRH rebate does not have a $450,000 fair market value limitation per unit.
The rebate is available for projects where construction began after September 13, 2023, but before 2031, and will be substantially completed before 2036. For this rebate, construction is generally considered to have begun when excavation for the project starts.
Converting existing non-residential real estate, such as office buildings, into residential complexes is eligible for the PBRH rebate if all conditions are met. However, the rebate does not apply to substantial renovations of existing residential complexes as the goal is to increase the housing supply.
Provincial Rebates:
The governments of Ontario, Nova Scotia, and Newfoundland and Labrador have announced they will mirror the federal PBRH rebate and provide a 100% rebate of the provincial portion of HST in their provinces. Prince Edward Island will also generally mirror the federal rebate, offering a 100% rebate of the provincial component of HST, subject to a maximum rebate per unit and a reduced rebate rate for projects completed after 2028.
How to Apply:
GST/HST registrants can file a PBRH rebate online using My Business Account by selecting the existing GST/HST New Residential Rental Property Rebate Application (GST524). Non-registrants will soon be able to file online by selecting GST524 in My Account. In the interim, they can contact the CRA at 1-800-959-5525 for guidelines on how to apply.
For more information on the purpose-built rental housing rebate, visit the CRA’s GST/HST rebate for purpose-built rental housing (PBRH) page.
This rebate aims to make rental housing more accessible and affordable for Canadians, reflecting the government’s commitment to addressing the housing crisis and supporting the social and economic well-being of the nation.
Apply Now for the CVITP Grant to Support Free Tax Clinics!
Calling organizations that host free tax clinics – apply now for the CVITP grant!
The Canada Revenue Agency (CRA) is inviting community organizations that host free tax clinics through the Community Volunteer Income Tax Program (CVITP) and the Income Tax Assistance – Volunteer Program (ITAVP) in Quebec to apply for the CVITP grant. Applications are open from May 1 to June 30, 2024.
The CVITP Grant is designed to help cover the costs of running free tax clinics by providing financial support based on eligible expenses and the number of tax returns filed. Last year, the CRA updated its funding formula and distributed $4.6 million to eligible organizations, bringing the three-year total to nearly $9 million with 3,688 funding agreements. In 2023, these clinics helped over 758,000 Canadians file their tax returns, resulting in $2 billion in tax refunds and access to benefits and credits.
Grant Calculation:
Base amounts:
- $500 for organizations filing 10 to 49 tax returns.
- $1,500 for organizations filing 50 or more tax returns.
Supplemental amounts:
- $250 for organizations serving Indigenous communities.
- $250 for organizations operating in Northern communities.
- $250 for organizations in rural and remote communities.
- $5 per tax return filed.
If your organization is registered with the CVITP or ITAVP and hosted free tax clinics between June 1, 2023, and May 31, 2024, you are encouraged to apply for this year’s CVITP Grant. For more information on eligibility criteria and the application process, visit Canada.ca/free-tax-clinics-grant.
Interested in Hosting a Free Tax Clinic?
Some tax clinics operate year-round. If you’re interested in hosting a free tax clinic to help more Canadians access the benefits, credits, and refunds they are entitled to, visit host a free tax clinic for more information.
Managing Business Taxes Online Made Easy
The Canada Revenue Agency (CRA) offers digital services to make handling your business tax matters faster and easier. Through these services, you and your authorized representatives can efficiently file, pay, and access detailed information about your tax accounts.
My Business Account
My Business Account is a secure online portal that simplifies managing your company’s tax affairs. You can register using a CRA user ID and password or through a Sign-In Partner. This platform allows you to:
- Access GST/HST, payroll, corporation income taxes, excise taxes, excise duties, and other levies accounts online.
- Receive and view your CRA mail.
- Submit documents.
- Manage authorized representatives.
- View and pay balances.
- File and adjust GST/HST returns, including expected and filed returns.
- Transfer payments.
- File information returns, such as the T4 slip.
- Get answers to your questions.
If you report your business income on a personal tax return, sign up for My Account to manage your personal income tax and benefit information.
Payroll Deductions Online Calculator
The Payroll Deductions Online Calculator (PDOC) helps you calculate federal, provincial (excluding Quebec), and territorial payroll deductions. It can be used for salaries, commissions, pensions, and verifying Canada Pension Plan (CPP), additional CPP contributions (CPP2), and Employment Insurance premiums.
GST/HST Calculator
If you’re unsure about when to register for and start charging GST/HST, use the GST/HST calculator to determine the tax amount applicable to sales in Canada. Follow these steps:
- Visit the GST/HST calculator.
- Select if the amount was before or after taxes.
- Choose the province or territory where the sale occurred.
- Enter the sale amount.
- Click calculate to get the GST/HST rates.
Paying Your Taxes
The CRA provides several online payment options:
- Through your financial institution’s online banking, mobile web app, or telephone service.
- Using the CRA’s pre-authorized debit service via My Business Account.
- Via My Payment service, which allows online payments directly to the CRA (excluding credit cards).
- By credit card, PayPal, or Interac e-Transfer through a third-party service provider.
If you can’t afford to pay your debt in full, contact the CRA to discuss payment options like payment arrangements or pre-authorized debit agreements.
Filing Online
The CRA encourages you to file returns online. Filing online and signing up for direct deposit can expedite any refunds you may be eligible for. Self-employed individuals can use NETFILE, and incorporated businesses can use T2 certified software or My Business Account for GST/HST returns.
Penalties for Non-Electronic Filing
Starting January 1, 2024, filing six or more information returns electronically is mandatory to avoid penalties. For GST/HST reporting periods beginning in 2024, electronic filing is required for all registrants except charities and selected financial institutions.
Additional Support
For further assistance, the CRA offers the Liaison Officer service, providing confidential support to small businesses and self-employed individuals. You can also find helpful information on Canada.ca, including resources tailored for Indigenous individuals and guidance on managing business changes.
For more information, visit the CRA’s website or contact them directly.
Calgary Woman Convicted for False Tax Statements
Calgary woman convicted of making false statements in the filings she made for over 50 individuals
The Canada Revenue Agency (CRA) announced that Monique Van Dijk of Calgary, Alberta, pleaded guilty on November 16, 2023, to making false statements in tax returns under the Income Tax Act. Van Dijk was fined $116,000 and received a conditional sentence of 12 months of house arrest, followed by 12 months of probation.
A CRA investigation revealed that Van Dijk filed over 200 T1 tax returns and “change my return” requests for more than 50 individuals between March 2016 and July 2019. She made false claims on a significant number of these filings to obtain the Working Income Tax Benefit and other refunds, resulting in excess or undeserved refunds.
The CRA publicizes such convictions to deter tax evasion and maintain confidence in the tax system. In addition to court-imposed fines and sentences, convicted individuals must pay the full amount of taxes owed, plus interest and penalties.
The CRA remains committed to pursuing tax evasion and false claims to ensure the integrity of Canada’s tax system and the proper administration of benefit programs. Individuals or businesses that underreport income or make false claims may have to repay benefits and face additional consequences.
Trois-Rivières Resident Sentenced for Fraudulent Tax Claims Involving Fictitious Children
The Canada Revenue Agency (CRA) announced that Wayne Kendall Jr. of Trois-Rivières, Quebec, was sentenced on October 20, 2023, to an 18-month prison term, followed by two years of probation. Kendall Jr. pleaded guilty on March 10, 2023, to making false statements and forgery.
A CRA investigation uncovered that from 2015 to 2018, Kendall Jr. fraudulently obtained over $377,000 by submitting false claims for tax credits and benefits. He impersonated 18 different individuals to claim credits and benefits for 61 fictitious children, depositing the funds into various bank accounts he had opened under false identities. Kendall Jr. used his former employment with the CRA to access the data needed for his scheme.
Tax evasion, including falsifying records and claims, not reporting income, or inflating expenses, is a crime with severe consequences such as fines, jail time, and a criminal record. From April 1, 2022, to March 31, 2023, there were 31 convictions for tax evasion, resulting in fines totaling $6,925,440 and 32.7 years of combined jail time for 12 individuals.
In addition to court-imposed penalties, convicted individuals must pay the full amount of taxes owed, along with interest and penalties assessed by the CRA. The CRA is committed to maintaining the integrity of Canada’s tax system and aggressively pursues tax evasion and false claims to ensure that all income is reported and benefits are claimed correctly. Those who underreport income or make false claims may have to repay benefits and face further legal action.
Director of Temporary Staffing Agencies Convicted of Tax Fraud for Failing to Report Over $2.3 Million
The Canada Revenue Agency (CRA) announced that Sung Oh Chung of Thornhill, Ontario, was sentenced on September 12, 2023, in the Toronto Courthouse to a conditional sentence of two years less a day and a fine of $681,235. Chung pleaded guilty to fraud over $5,000 under the Criminal Code on March 21, 2023.
A CRA investigation revealed that Chung failed to report $2,310,678 in personal income on his tax returns for 2012 to 2016. He appropriated these funds from unreported sales and unremitted Goods and Services Tax/Harmonized Sales Tax (GST/HST) from Sovereign Staffing Inc. (SSI) and Talent Savvies Inc. (TSI), where he was a director. This resulted in evading $681,325 in taxes.
SSI and TSI, which provided temporary labor services in the Greater Toronto Area, used multiple bank accounts but reported only one to the CRA. This allowed Chung to appropriate funds from the other accounts.
Chung was required to pay $500,000 within 24 hours of sentencing, with the balance due by September 11, 2025.
Chung’s business partner, Kwang Won Lee, also pleaded guilty to fraud over $5,000 and was sentenced on September 7, 2023. For more information, see “Convicted of tax fraud: temporary staffing agencies’ director fined $999,000.”
Tax evasion is a serious crime with severe consequences, including fines, jail time, and a criminal record. Between April 1, 2022, and March 31, 2023, there were 31 convictions for tax evasion, resulting in $6,925,440 in fines and 32.7 years of combined jail time for 12 individuals.
The CRA remains dedicated to maintaining the integrity of Canada’s tax system, aggressively pursuing tax evasion and false claims. Individuals and businesses must report all earned income and only claim entitled benefits to ensure the proper administration of important programs. Those who underreport income or make false claims may face repayment of benefits and further legal actions.
This information is for discussion purposes only and should not be considered professional advice. There is no guarantee or warrant of information on this site and it should be noted that rules and laws change regularly. You should consult a professional before considering implementing or taking any action based on information on this site. Call our team for a consultation before taking any action. ©2024 Shajani CPA.
Shajani CPA is a CPA Calgary, Edmonton and Red Deer firm and provides Accountant, Bookkeeping, Tax Advice and Tax Planning service.
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