Recently Published Articles

Laura Couvrette was recently published in B&C Canada Magazine

“If you are like most small and medium-sized construction companies, you have been focused on growing your business by investing in new equipment, hiring new staff and networking to ensure you have the opportunity to bid on new contracts…”  Click here for more

Jonas Cohen’s article in B&C Canada Magazine

Although the current economic climate presents significant challenges for some businesses, it is an opportune time for well-managed and well-financed companies to consider a strategic acquisition that will position them for growth.  To see the complete article, click here

Read Patricia Harris’ recent article in AdvocateDail.com: Courtroom tweeting policy excludes many

A new policy allowing lawyers, self-represented parties and journalists to tweet from the courtroom is too limiting, says Toronto forensic accountant Patricia Harris… Click here for more

Read Patricia Harris’ recent article in Building and Construction Canada magazine: Fraud Prevention
Robert Jones has been working for you for over 15 years. More than a trusted employee, you consider Rob a friend. His dedication is unparalleled. Even as he navigated his way through a very difficult divorce a couple of years ago, he didn’t take more than a couple of days’ vacation… Click here for more

Read Sloan Levett’s recent article in The Baker’s Journal: The Magic Number – How much do you need to retire?  
How much money do you need to retire? Is the magic number $1 million, $2 million or maybe $5 million? We all think about retirement, usually more often as we get older. Maybe we have it backwards. We should start thinking about retirement earlier and, equally important, create a financial strategy to get us there… Click here for more

Fuller Landau Welcomes Derek Wagar to Partnership

Fuller Landau is pleased to announce that Derek Wagar has been promoted to Partner.

With 15 years of experience, Derek provides tax strategy, planning and compliance services to a wide range of entrepreneurial clients.

“Derek has a proven track-record of successfully working with entrepreneurs and high net worth individuals across the GTA to help them build innovative strategies to minimize tax.  His commitment to client service excellence combined with his deep knowledge of Canadian tax make him an ideal fit for our partnership” said Gordon Jessup, the leader of Fuller Landau’s tax team.

“I am very excited to be promoted to partnership.  I have worked at Fuller Landau for many years and feel there is no firm better suited to meeting the needs of private companies” said Derek.

Derek will continue to offer advice on Canadian tax planning and compliance issues to the firm’s clients.

Derek can be reached at: (416) 645 6518 or by email at dwagar@fullerlandau.com

Canada and U.S. Reach Agreement on Foreign Account Tax Compliance Act

Finance Minister Jim Flaherty and National Revenue Minister Kerry-Lynne D. Findlay today announced that, after lengthy negotiations, Canada and the United States have signed an intergovernmental agreement under the longstanding Canada-U.S. Tax Convention.

In March 2010, the U.S. enacted the Foreign Account Tax Compliance Act (FATCA). FATCA would require non-U.S. financial institutions to report to the U.S. Internal Revenue Service (IRS) accounts held by U.S. taxpayers. Failure to comply with FATCA could subject a financial institution or its account holders to certain sanctions including special U.S. withholding taxes on payments to them from the U.S.

http://www.fin.gc.ca/n14/14-018-eng.asp

New Changes to the Foreign Income Verification Statement (Form T1135)

As indicated in our Tax Alert in the summer, the Canadian Government has issued a strengthened Foreign Income Verification Statement (Form T1135), which contains certain changes to the foreign reporting requirements of Canadian resident taxpayers. These changes were employed as part of the measures under the “Economic Action Plan 2013” to better target international tax evasion and aggressive tax avoidance.

The requirement to file Form T1135 has remained the same. In summary, Canadian taxpayers who own specified foreign property with a cost of more than C$100,000 in total at any time in the taxation year are required to file Form T1135.

Canadian taxpayers include Canadian resident individuals, corporations, trusts, and partnerships.

Specified foreign property includes the following:

  • Funds held outside Canada;
  • Shares of non-resident corporations (other than foreign affiliates);
  • Indebtedness owed by non-residents (other than from foreign affiliates);
  • Interests in certain non-resident trusts;
  • Real property situated outside Canada (other than personal use property and real property used in an active business); and
  • Other types of foreign property such as intangible property not used in a business and certain rights under contract.

Specified Foreign Property does not include:

  • Foreign property used or held exclusively in carrying on an active business;
  • Shares or indebtedness of foreign affiliates (Form T1134 is required for foreign affiliates); and
  • Personal-use property such as a vacation home, works of art or jewellery.

Form T1135 must be filed on or before the due date of the related income tax return or, in the case of a partnership, the due date of the partnership information return.

Failure to file the T1135 by the tax-filing due date can result in substantial penalties ranging from $25 per day with a minimum penalty of $100 to a maximum penalty of $2,500. In the case of gross negligence, the penalty can be as high as $1,000 a month to a maximum penalty of $24,000. After 24 months, the penalty is 5% of the value of the specified foreign property.

New Reporting Requirements for Form T1135
The current version of the T1135 form requires only general information regarding the specified foreign property such as the value, the continent where it is located and the amount of income it generates.

The new reporting requirements for Form T1135 are applicable for taxation years ending after June 30, 2013. For individual taxpayers, the new form will be required with their 2013 Canadian personal tax returns.

The new changes to the T1135 form will require taxpayers to provide more detailed information regarding each specified foreign property including the following;

  • The description of the specified foreign property;
  • The name of the country where the specified foreign property is located;
  • The maximum cost base of the specified foreign property during the tax year;
  • The cost base of the specified foreign property at the end of the tax year;
  • The exact amount of the income or loss generated from the specified foreign property; and
  • The gain or loss (if any) from the disposition of the specified foreign property.

An election can be made on the new Form T1135 to report the relevant cost and income amounts in the functional currency instead of in Canadian dollars.

If the Canadian taxpayer has received a T3 or T5 slip from a Canadian issuer reporting the income earned from a specified foreign property for a particular tax year, the detailed disclosure of that specified foreign property is not required to be included on the new Form T1135 for that year. However, the new Form T1135 must still be filed to report this exclusion by checking the applicable box on the form.

This exclusion only applies to the income reported on the T3 or T5 slips. For example, if a taxpayer has a Canadian brokerage account containing specified foreign property with a cost of $120,000 and a T3 or T5 slip was issued for income earned on 40% of these assets, the remaining 60% of the assets must be fully disclosed on the new Form T1135. Also, the $100,000 threshold is based on the total aggregate cost of the specified foreign property and not solely on the property that produces income, regardless if a T3 or T5 slip is issued.

The normal reassessment period for a taxpayer will be extended by an additional three years if the taxpayer has failed to report the income from the foreign property on their tax return; and the form was not filed on time and/or was completed improperly. Currently, the normal reassessment period for most taxpayers is three years.

Increased Compliance

Taxpayers should be aware that the changes to Form T1135 may significantly increase the time needed to gather the required information and to prepare the form. If you own foreign property you should contact your Fuller Landau advisor to discuss how these new reporting requirements will affect you.

For further information please contact:

Gordon Jessup
(416) 645-6508
gjessup@fullerlandau.com

Andy Yap
(416) 645-6536
ayap@fullerlandau.com

Derek Wagar
(416) 645-6518
dwagar@fullerlandau.com

Frank Casciaro
(416) 645-6586
fcasciaro@fullerlandau.com

Martin Lee
(416) 645-6522
mlee@fullerlandau.com

RRSP/TFSA – Deadline Approaching…

Just a reminder that the RRSP/TFSA deadline is approaching. Here’s what you need to know:

  • The 2013 RRSP contribution deadline is March 3, 2014
  • The 2013 RRSP maximum contribution limit is $23,820
  • To determine your 2013 RRSP contribution limit, check your 2012 Notice of Assessment
  • The 2014 RRSP maximum contribution limit is $24,270
  • The 2014 TFSA contribution limit is $5,500
  • The total TFSA contribution limit to date is $31,000

For more information, please contact your Fuller advisor or Sloan Levett of the Family Office group at (416) 645-6581 or slevett@fullerlandau.com.

Transitional Reporting Announced for Foreign Income Verification Statement (Form T1135)

As indicated in previous newsletter, the Canadian Government has issued a strengthened Foreign Income Verification Statement (Form T1135), which contains certain changes to the foreign reporting requirements of Canadian resident taxpayers. The new T1135 requires taxpayers with over C$100,000 in foreign property to provide a much greater level of detail around their investment.

In an effort to ease the transition to these new reporting requirements, the CRA has announced that it is permitting streamlined reporting for certain specified foreign property. Specifically, a taxpayer who held specified foreign property in an account with a Canadian registered securities dealer (as defined in subsection 248(1) of the Income Tax Act) may now report the combined value of all such property at the end of the tax year, rather than reporting the details of each property. This combined value should be included in Category 6 of Form T1135, “Other property outside of Canada.” If a taxpayer chooses to use the 2013 transitional reporting method, the taxpayer must use this reporting method for all accounts with Canadian registered securities dealers.

Click here for more details.

Sloan Levett participating in the 4th Annual Canadian Alternative Investment Forum

On Thursday April 3rd, 2014, Sloan Levett will be participating in the Panel – In Pursuit of Yield: Alternatives to Fixed Income at Introduction Capital’s 4th Annual Canadian Alternative Investment Forum. It will be followed by a short Q&A afterwards. For more information please visit http://www.introcap.com/caif-2014/

2014 Federal Budget Analysis

The Minister of Finance Jim Flaherty presented his 2014 Federal budget in the House of Commons yesterday. As expected, the new budget included no new taxes, closed a number of perceived tax loopholes, and committed to a balanced budget in 2015.  As part of the budget, there are also a number of tax changes that will impact owner managers and private companies operating in Canada. Please listen to our podcast to learn about some highlights including:
• GST elections changes
• Changes to the tax treatment of testamentary trusts and elimination of the tax benefits provided to immigration trusts
• Changes to thin capitalization rules
• Changes to the timing of employer payroll remittances
• Kiddie tax changes

Fuller Landau’s client portal unaffected by the Heartbleed bug

Fuller Landau LLP would like to reassure our clients that the security of your information is always of the highest priority. Our secure client portal has been verified and is not vulnerable to the OpenSSL Heartbleed bug.
Please be assured you may continue to use the portal to safely upload and download your financial documents.
Should you have any questions about the security or safety of the information you share with Fuller Landau please feel free to contact your advisor.
For more information on the Heartbleed Vulnerability please click: http://heartbleed.com.

Fuller Landau Recognized as a Great Place to Work®

TORONTO, ONTARIO – (April 17, 2014) -Fuller Landau is pleased to announce that it has been named one of the “Best Workplaces in Canada” by the Great Place to Work Institute and The Globe and Mail.

“We are very pleased to once again be recognized as a Great Place to Work. Our firm invests a great deal of time and energy in building a dynamic work environment, full of opportunities for our people to learn new skills and build their careers” said Gary Abrahamson, Partner at Fuller Landau.

“We feel that this award reflects our commitment to our people and our shared values of learning, integrity, excellence, nurturing and teamwork, which are at the foundation of everything we do” he added.

Fuller Landau is a mid-sized audit, tax and advisory firm that serves a wide range of private companies. The firm recognizes that excellent client service begins with a great team.  The firm constantly implements improvements to its “People Program” to ensure the program continues to retain, motivate and recognize team members.

“As a leading professional services firm we know first-hand the importance of retaining great people and helping them build their careers.  Our People program is designed to enhance work experience and promote a healthy balance between work and personal life, so that our people don’t have to compromise what matters most” said Jill Daiter, Director of Human Resources.

The list of “Best Workplaces in Canada” is compiled by Great Place to Work® Institute Canada through a competition process based on two criteria: a comprehensive employee survey and an in-depth review of the organization’s culture, including an evaluation of HR policies and procedures. This offers a rigorous representation of the organization from an employee perspective, and an overall portrait of the workplace culture. Together, they provide crucial data relative to the five trust-building dimensions of a great place to work®: credibility, respect, fairness, pride, and camaraderie.

This year’s list received over 300 nominations and over 59,000 employees participated in the 2014 “Best Workplaces in Canada” survey.

About Great Place to Work® Institute: Great Place to Work® Institute is a global research and management consultancy with expertise on workplace transformation and a presence in 46 countries worldwide. Our mission is to improve society by creating better workplaces. We are best-known for our global Best Workplaces Program, which we produce in conjunction with prestigious media partners such as the Globe and Mail, the Financial Times and Fortune. With more than 5,500 organizations surveyed every year across the globe, the program is the world’s largest of its kind. We believe passionately that any company or organization can become a great place to work. Our mission is to help you do it.

Share This