Tax Court of Canada Rules that B.C. Business Owner Who Faced "Blatant" Racism and Sexism Not Liable for $100,000 in Taxes Owed:
The Tax Court of Canada ruled last week that B.C. business owner Karla Penate is not liable for over $100,000 in outstanding taxes from her Vancouver-are roofing business, Delphina Enterprises Ltd, due to the racism and sexism Ms. Penate and her employees faced when trying to collect on invoices.
Justice Diane Campbell noted that Ms. Penate and her business had done their due diligence in trying to collect the outstanding funds, however, the barriers Ms. Penate faced - namely "blatant" and "aggressive" racism and sexism - absolved Ms. Penate and her roofing business from their outstanding tax liabilities. This novel ruling is certain to make waves in the Canadian tax community.
Read the decision here. Read more from the Globe and Mail here.
Canada Revenue Agency Extends Tax Deadline to September 30th:
Canadians with outstanding tax liabilities have been provided an extension to September 30th to clear their balances with the Canada Revenue Agency. The extension is intended as a relief-measure in response to the ongoing COVID-19 pandemic, and the economic turmoil that it has caused.
The CRA also announced that late-filing fees have likewise been postponed until September 30th.
However, the CRA is still encouraging Canadians to file their tax returns as soon as possible, as to not be cut-off from potential tax benefits and credits. The CRA in a statement said that "currently, if a 2019 individual tax return has not been assessed, the CRA is calculating benefits and/or credits for the July to September 2020 payments based on information from 2018 tax returns. However, if 2019 individual tax returns are not received and assessed by early September 2020, estimated benefits and/or credits will stop in October 2020 and individuals may have to repay the amounts that were issued as of July 2020."
Read more from Richmond News here.
Commentary: The CERB and Other COVID-19 Relief Benefits are Taxable, and Canadians Should be Preparing:
According to BNN Bloomberg, as of July 26, the Canadian government had doled out over $63 billion to nearly 8.5 million individuals with the CERB (Canada Emergency Response Benefit) program alone. With those unprecedented numbers, Canadians should know that their COVID-19 economic response benefits are fully taxable as income, and should begin preparing for those tax liabilities.
Jason Abbott, President of WealthDesigns.ca, tells BNN Bloomberg that Canadians understanding of their tax liabilities with respect to the COVID-19 economic response benefits are "all over the map. Some people get it inherently, some people need a reminder." CIBC managing director of tax and estate planning Jamie Golombek said that Canadians should "set aside the money now. Don’t try to look for it next April because if you file and don’t have the money you owe, you’ll be hit with interest and possible penalties."
Read more from BNN Bloomberg here and here.
OPINION: Canada's Tax Regime is Overdue for a Reset:
Kevin Carmichael argues in the Financial Post that the Canadian tax system is badly in need of an overhaul, and that the unprecedented economic challenges caused by the COVID-19 pandemic present an excellent opportunity to finally reform the way Canadians are taxed.
Carmichael quotes Pamela Cross - a Commissioner with the Canadian Chamber of Commerce and a partner at Borden Ladner Gervais LLP - stating that "we have a tax system that is overly complicated, virtually impossible to administer, and very difficult to comply with. Most individuals with fairly straightforward situations should be able to do their own tax returns. Many people can’t anymore."
Read more from the Financial post here.
- Corey LeBlanc (JD Candidate, OHLS Class of '21)