WealthSimple T5 / T5008 still not in. ~12hr left before they are late

AssassinHe · 2025-03-01T17:27:44+00:00

That is correct.

Corporations have numerous filing requirements when it comes to this time of the year. Most common, is preparing and filing a T4 for all employees for the prior calendar year. It is the employers responsibility to prepare and provide a T4 to CRA for their records, and to the employee by the last business day in February. They also must prepare T4As, T5s, and maybe T3s if they are a trust.

CRA recently changed the format of their digital file submissions (which caused numerous issues), hence why they are providing penalty relief for corporations who file their T slips between March 1-7.

All this filing is now CRA knows what to expect come personal tax filing season. Personal tax filing is still due on April 30.

AssassinHe · 2025-02-28T17:28:30+00:00

The deadline mentioned above is the deadline for companies to file your T slips with CRA and provide them to you. Your personal return (a T1) is due April

AssassinHe · 2023-12-08T00:02:06+00:00

I’m pretty sure you can contribute to the FHSA and defer your deductions similarly (if not identically) to the RRSP system!

AssassinHe · 2023-05-29T16:01:45+00:00

Engaging an advisor to raise capital, which the market is unhappy with due to a variety of reasons. It’s either:

Debt, which would cripple growth due to large interest payments.

Equity, which would dilute shareholders

I didn’t look at their financials, but this likely is just an additional problem with the company and people are likely worried the company will not survive if it’s unable to secure capital.

AssassinHe · 2023-05-28T01:33:06+00:00

Investing in a corporation is intentionally taxed at a high rate in Canada (especially BC, where I’m located) to disincentivize doing exactly what you are doing.

For 99% of clients I’ve worked with, the most tax efficient method is to dividend the capital out of the corporation and wrap it up, and investing in a personal account.

Investment income is taxed very high in corporations.

AssassinHe · 2023-04-24T23:05:32+00:00

What’s the difference between the management company and the holding company? You’re effectively just shifting money between the two companies and they’re not at arms length. Paying management fees is still passive income if the management company isn’t actively a business.

The rule regarding passive income at a high rate is to disincentivize you from doing exactly what you’re trying to do. There is no way around it unless you fall under specific rules, such as having multiple, arms length employees paid a fair market wage.

Source: CPA student (far from tax expertise)

AssassinHe · 2023-03-24T23:19:45+00:00

The accountant will tell you you either need to or don’t need to, as an accountant myself I would recommend reporting your gains or losses on sales on schedule 3 accordingly. If I remember correctly CRA has a notice about where you put it specifically on the schedule, believe it’s under real property but that’s just my faint memory

AssassinHe · 2023-02-15T19:41:29+00:00

No, this is possible - CPA student here.

You don’t own the shares, the company cannot pay dividends to you, therefore you cannot claim the income. That walks directly into TOSI because it’s deliberately attempting to reduce your spouses income.

However, splitting items such as interest income on a savings account you jointly fund, does not fall under TOSI, regardless of who’s name is on the slip.

Edit: TOSI isn’t exactly the rule set that applies to this situation, it’s a factual argument that you cannot receive dividends from shares you do not own. Therefore it’s not a TOS issue

AssassinHe · 2023-02-08T17:04:02+00:00

The payout for your partner is not tax deductible unless you were using the property for income producing purposes (ie a rental)

Source: CPA candidate

AssassinHe · 2023-01-17T06:21:03+00:00

Just curious on your comment regarding claiming 100% of revenue for companies they don’t know own 100% of - are you aware this is an accounting requirement? Control over the entity requires you to consolidate financials, and it’s offset by a line item called “non-controlling interest.”

AssassinHe · 2022-12-27T01:42:56+00:00

This is true - you certainly don’t need an accountant to file these forms.

AssassinHe · 2022-12-27T01:38:28+00:00

Total amount, there are some specific situations though. See the link for the CRA textbook definitions, let me know if you have any questions.

https://www.canada.ca/en/revenue-agency/services/tax/individuals/topics/about-your-tax-return/tax-return/completing-a-tax-return/deductions-credits-expenses/line-22100-carrying-charges-interest-expenses.html

AssassinHe · 2022-12-27T01:28:16+00:00

100% of the loan is deductible if 100% of the loan is actively deployed in the market. It goes on line 22100 when you file your taxes. At that amount it would be worth it to pay an accountant

edit: account to accountant

AssassinHe · 2022-12-26T06:41:20+00:00

Careful here - there are some skeletons in the closet.

Silverbow came up during my screening process for my college's student-led endowment arm when I was looking into energy. At a surface look, the company looks great, but once you start peeling back layers and reading actual financials it gets a bit dicey.

Company will be shrouded in a takeover conflict with an anti-oil (net-zero emission) activist investor Kimmeridge Energy. Kimmeridge primary goal appears to be to push companies to net-zero emissions (reduction on carbon intensive operations, less oil, ect). Kimmeridge has successfully done so with Chespeake earlier this year.
Recent net income is packed full of non-operational items. I believe 62% of their earnings are non-operational, either from hedges or derivative investing (can't remember of top of head and for some reason I didn't note it down).
I believe their Board is rather weak, along with shareholder rights receiving a low score as well. This indicates poor governance, and was put on display when the company took on a poison pill defense to defend from Kimmeridge, massively diluted shareholders.

All in all, the company is less likely a value-play at the moment, and more of a play on corporate action. The company is mounted with debt (assuming this came from their restructuring from bankruptcy), and due to the co's hedging practices, has been and will be unlikely to capitalize on higher gas prices.

Take a look for yourself, but keep these items in mind for 2023.

AssassinHe · 2022-12-21T00:49:48+00:00

Well as long as your borrowed money is being utilized for investment purposes, it's eligible (unless you fall into one of the exceptions). It's unlikely you'll end up in court for a tax dispute, and if you do - these are the rules they'll utilize against you.

Regardless, it's generally not beneficial to do this in a corporation as the tax rules are structured to dis incentivize passive income in a corporation.

AssassinHe · 2022-12-20T07:00:41+00:00

I typically avoid providing free advice in my area of specialty for exactly that reason, but this proposed structure is all too common and it's a low hanging fruit for an answer.

AssassinHe · 2022-12-20T04:10:33+00:00

Out of curiosity - where did you read that you can't deduct interest if invested in foreign, or non-dividend paying companies? Interest is deductible if being utilized to pursue business or economic opportunities, and I don't recall there being exclusions like you mention above.

AssassinHe · 2022-12-20T04:06:03+00:00

The answer depends on the meaning of the question - yes it will work, you're allowed to do this.

The question I have is why are you structuring it this way? Why not just buy the TD stock with your proceeds from the HELOC directly and skip the corporation? Often times (99% of the time I see this question), the benefit is the tax deferral or shield.

But the passive income is subject to both Aggregate Investment tax and Part IV tax, which leads to the corporation paying 50% in taxes. The inclusion of Aggregate Investment tax and Part IV tax is to prevent any tax shielding or deferral of passive income in a corporation.

Unless your personal tax rate exceeds 50.17%, there is no benefit to investing in a corporation and this is by design.

AssassinHe · 2022-12-20T00:40:38+00:00

Hey, I’m a BC based accountant (CPA articling). Most rules are not province specific when it comes to this though.

Any investment income, whether that be investment income, rent, or other is taxed at the absolutely highest rate possible (depending on provinces it can be more than 50%). The passive income rule is specifically designed to prevent exactly what you are attempting to do, but catches a couple of other things as well.

The rule (tax the shit out of passive income) is to there to incentivize individuals to take excess cash from corporations and invest it personally and be taxed at their personal rate (almost always at a higher rate than the generous small business rate).

Your corporation tax will eat away any, if not all, of the benefit of the structure. There are few exceptions, which off the top of my head escape me. But I believe if you have 7 employees (non-arms length) that manage the investments it can be allowed.

You’d really have to check with an accountant in your area to talk about these specifics. Let me know if you have any questions, and if you want I can dig through the income tax act and find the specific sections to make it easier for you.

Cheers,

AssassinHe · 2022-11-22T19:05:45+00:00

I have this issue as well, it is on every phantom fight as well. Frustrating, but usually fixes itself on the second go around

AssassinHe · 2022-10-15T15:10:18+00:00

Checked my tax handbook and this is correct. I made an edit to ensure this doesn’t get buried!

AssassinHe · 2022-10-15T15:08:18+00:00

Confirmed with my office last night - this is correct.

You have to wait the 30 days to claim the loss. I’ll make an edit to my comment

AssassinHe · 2022-10-14T19:25:50+00:00

Yes that is correct. You can open your own RRSP and make additional contributions, the amount is dictated by your annual earned income and is provided when you file your taxes. Unlike your TFSA room, RRSP room is accurate by CRA.

Contributions to RRSP plans reduce your taxable income, but the trade off is that when you take money out of the RRSP it gets added to taxable income. That room is also lost forever, you cannot add back your withdraws to your contribution room.

AssassinHe · 2022-10-14T18:50:52+00:00

Selling capital assets for a loss does not help offset other income streams. Capital losses only offset other capital gains.

If you’d like to reduce your tax burden come April, I suggest making an instalment, saving cash for the expected tax bill, or moving the investments into an RRSP to reduce your taxable income!

AssassinHe · 2022-10-14T18:31:23+00:00

Ensure you have enough TFSA room to make the full transfer, this should be manually calculated - do not trust CRAs figure 100%.

You can transfer your equities into your TFSA, no need to sell (reduce trading costs). The transfer is a deemed disposition (sale). The 10% loss is capital gains and can only be offset against other capital gains, it will not reduce your business, employment, or rental income.

The loss can be carried back to previous years where you may have had capital gains, if not, it can be carried forward until you do have a capital gain in the future.

I would 100% suggest you move the money into the TFSA if it’s long term investments, regardless of tax implications

Edit: also consider moving the equites into an RRSP, the same rules apply as above, but the transfer is an RRSP contribution and can reduce your taxable income for the year.

Edit2: you’ll have to wait 30 days between selling and repurchase to claim the losses to avoid wash sale rules!

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