On April 19, the liberal government approved the long overdue federal budget.
While there isn’t enough space here to go into each element of the 729-page document, I wanted to highlight a few important elements that are suggested that will affect your personal financial planning:
* Note that these measures have not yet been passed by law.
The Canada Recovery Benefit (CRB)) is extended for an additional 12 weeks for a maximum benefit of 50 weeks. The first four weeks are paid at the current rate of $ 500 per week, and the following eight additional weeks are paid at the rate of $ 300 per week.
The 2021 budget also proposes to Extension of the Canada Recovery Caregiving Benefit (CRCB) an additional four weeks to provide a maximum benefit period of 42 weeks at a rate of $ 500 per week.
The budget also proposes legislative changes to enable additional extensions of the CRB and the CRCB as required by November 20, 2021 at the latest.
For business ownersThey propose extending the Canadian Emergency Wage Subsidy (CEWS) until September 25, 2021. The current subsidy rate will gradually decrease as the program expires.
In addition, entrepreneurs take advantage of this of the Canada Emergency Rent Subsidy (CERS) will also be extended until September 25, 2021. Similar to the CEWS, a gradual withdrawal from the program leads to a reduction in the subsidy rate available in each subsequent period.
The Canada Emergency Business Account (CEBA) has been improved. This program provides small businesses with an interest-free loan for non-deferred expenses of up to $ 60,000. One third of the loan is forgivable if the remaining loan amounts are repaid by December 31, 2022.
The Canada Recover Hiring Program (CRHP) grants a grant of up to 50% (also decreasing over time) on the additional compensation paid to eligible employees between June 6, 2021 and November 20, 2021. An employer can apply for a CEWS or a CRHP, but not both in a given qualification period.
Budget 2021 announced the intention Establish an inflation-indexed federal minimum wage of USD 15 per hour to support workers in the federally regulated private sector.
Homeowners and landlords can access interest-free loans up to $ 40,000 for certain home energy retrofits determined by an authorized EnerGuide energy assessment. These loans are designed to help fund more expensive upgrades such as replacing windows and doors, installing high-performance stoves and water heaters, or improving insulation.
An increase in old-age insurance is proposed (OAS) Benefits for senior citizens aged 75 and over. The first step will be a one-time payment of $ 500 in August 2021 to OAS retirees who are 75 years of age or older as of June 2022. The second step is to increase the regular OAS payments (again only for 75 and more) by 10% starting in July 2022.
Proposed changes to the list of mental functions Daily life used in Disability Tax Credit (DTC) assessment is designed to facilitate assessment, reduce delays, and improve access to benefits. Those who did not qualify before should see if they can now.
The introduction of a luxury tax For retail sales of selected automobiles, airplanes and boats has also been proposed. The new tax will take effect January 1, 2022 and will apply to automobiles and aircraft priced above $ 100,000 and boats above $ 250,000.
The excise duty rates for tobacco products are increasing from now on and there was also a proposal to introduce a new tax on vaping products in 2022.
Empty or underused property owned by non-residents Canada will impose a new annual federal tax of one percent starting January 2022.
While the above list is certainly not exhaustive, it does show the key changes proposed in the federal budget that will affect your bottom line in the short term.
Make sure that you are taking full advantage of the programs available to you and that your plan is as tax efficient as possible.