Need Help? Canada Revenue Agency letter campaign

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Canada’s tax system is based on self-assessment, which means that individuals are responsible for accurately completing and filing their tax returns on time. The Canada Revenue Agency (CRA) provides Canadians with the information they need to meet their income tax obligations.

See link below for link to CRA website:

http://www.cra-arc.gc.ca/whtsnw/tms/lttrcmpgn-eng.html#_pubs

If you have received one of these letters from the CRA and you need assistance we can help.

Contact us to setup an appointment:  i...@axxion.ca or Call 613-884-0208

 

 

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IT workers build political support against CRA

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Contractors are frustrated by a Canada Revenue Agency ruling they are not businesses and don’t qualify for tax credits, writes James Bagnall

I will be posting additional articles with respect to this on my blog shortly.  I will re-post to LinkedIn when completed.
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Meal and Vehicle Rates used to Calculate Travel Expenses for 2010 vs. Vehicle Expenses for Business Purposes

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Every year it seems that there is one area of small business tax that is a source of confusion and this year for several of my clients it seems to be the meal and vehicle rates used to calculate travel expenses.

Several of my clients are under the impression that they can use the meal and vehicle rates stated by CRA on their website to calculate their expense amount that they will claim on their T2125.

This is incorrect application of the CRA policy on   meal and vehicle rates used to calculate travel expenses.  These rates are only used in certain specific situations which are:

  • Medical Expenses;
  • Northern Residences Deductions; and
  • Moving Expenses

For more information on this you can refer to the CRA websites page with respect to Meal and Vehicle Rates used to calculate travel expense for 2010

Small businesses (Sole proprietorships) must use actual expenses to determine the amount of expenses that can be claimed for business use of a vehicle.

If there is a personal component with respect to the vehicle then there is a calcuation which is business Kms over Total Kms driven in the year to determine the percentage of business use.  The percentage is then applied against total vehicle expenses for the year to determine the allowable portion.

They must also keep a log book that supports the business use of a vehicle.  This is very important to have because in most cases if CRA reviews your vehicle expenses the first thing they will ask to see is the vehicle log book.

For more information on please visit the CRA websites page on Documenting the use of a vehicle

 

For more information on this you can refer to the CRA websites page with respect to Meal and Vehicle Rates used to calculate travel expense for 2010