Each year at this time, the Federal budget proposals are released. This does not mean they are immediate law as they must go through the normal legislative process but it’s a good indicator of where tax policy is heading.
Here is short list of items that will affect many of our clients in the future tax years. Most begin with the 2027 tax year.
Deadlines
Currently there are two deadlines for individuals. April 30 for those that are not self employed and June 15 for those who are or have spouses that are. The proposals consolidate the deadlines to May 15 for everyone.
Optional Flat Rate Credits
To simplify recordkeeping, credits for items like medical expenses, moving, adoption etc. can be tied to the event vs a receipt. This option will result in flat rate credit.
Estimated / Installment Payments
This would begin in the 2028 tax year. Taxpayers would be allowed to pay 2/3rd of their tax owing by December 31 and then settle with the return. The threshold for installments will increase to $7500. This would replace the current quarterly regime.
Notice of Objection Deadlines
Instead of 90 days, it will be a year.
Penalty Increases
Penalties will be increased based on the original amount adjusted for inflation since they were established
Speaking of Penalties
The threshold for the pesky T1135 for non-Canadian accounts and assets will increase to 200K and simplified reporting to the 250-500K ranges
