Income taxes

Taxability of Child Care Expenses for Employees

by

Child care is not taxable only if all of the following conditions are met:

  • the services are provided at your place of business
  • the services are managed directly by you
  • the services are provided to all of the employees at minimal or no cost
  • the services are not available to the general public, only to employees

If not all of the conditions are met, the taxable benefit is the fair market value (FMV) minus any amount that the employee pays for the service.

When you subsidize a facility operated by a third party in exchange for subsidized rates for your employees, the amount of the subsidy is considered a taxable benefit for the employee.

Confirm a representative using My Account or My Business Account

by

There’s a new way to confirm authorized representatives using My Account or My Business Account. Whether you’re an individual or a business, this easy, two-step digital process will help you protect your tax information and make authorizing new representatives more efficient and secure.

Who is a representative?

Representatives are individuals you authorize to help you or your business manage your tax information. Your representative could be an accountant or lawyer, or a family member or friend. An authorized representative may be able to view, get information about and update some or all of your tax information.

It’s important to know who your representatives are and what information they have access to. Be proactive and make sure the representatives you have on file with the CRA are current. You can remove representatives that are not current by using My Account or My Business Account.

How to confirm a new representative using My Account or My Business Account

Follow these steps to confirm a new authorized representative or to accept changes to the authorization level of an existing representative using the new “Confirm my Representative” service.

  1. The first step is to make sure you have either My Account or My Business Account. If you haven’t used these services before, you will need to register for an account. You can check out the videos below for step-by-step instructions on how to register.

Keep in mind that registration may take several days. If you are planning to authorize a new representative, make sure to register for My Account or My Business Account in advance.

  1. Once registered, we recommend you enable email notifications to make sure you are notified when you receive a new authorization request. Email notifications let you know when you have mail to view in your account, and when important changes have been made to your account. Find out more about how to enable email notifications as an individual or a business.
  2. The next step involves your representative. They will need to sign in to Represent a Client to submit a new authorization request. When submitting this request, they will need to include a certification page signed by you or your delegated authority to complete the request.
  3. Once they have submitted a request, and if you have enabled email notifications, you will be notified by email that someone has requested access to your account. You must then sign in to My Account or My Business Account, where you can review your pending authorization request in the Authorized Representatives section of your account. You can then confirm or deny the request with the click of a button.
  4. You must confirm or deny the authorization request within ten business days, or the request will be cancelled and your representative will need to submit a new one.

Other options for individuals

If you are an individual, not a business, you can choose to authorize a representative without signing in to My Account and using the “Confirm my Representative” service. Instead, you will need to provide your representative with information from a notice of assessment that was issued to you at least six months earlier. When your representative submits their authorization request, they will need to provide this information. If you choose this option, you may be contacted by the CRA by phone to verify the request.

Other options for businesses

Delegated authorities (level 3 representatives) are also able to confirm or deny authorization requests in My Business Account on behalf of business owners.

If you are the owner or director of a business who is too busy or does not deal with routine tax matters, another officer of the company (tax officer, financial officer) can be designated as a delegated authority by the owner/director.

To do this, the business owner/director will still need to sign into My Business Account at least once in order to authorize the delegated authority. This delegate will have almost the same level of access as the owner/director to view and make changes to information in My Business Account, including confirming or denying new authorization requests for other representatives.

What to do if you can’t pay your taxes

by

If you ignore your tax debt, it will grow with interest charges and penalties. Penalties only apply if you file late or pay by installments and your installment payments are late or less than the required amount. Debts associated with COVID-19 Individual Emergency Benefits overpayments will not have penalties or interest assessed against the amount owing.

The tax-filing deadline for most individuals is April 30, 2022

Since April 30, 2022, falls on a Saturday, your return will be considered filed on time in either of the following situations:

  • received on or before May 2, 2022

You have until June 15, 2022, to file your return if you or your spouse or common law-partner are self-employed.

The payment deadline is April 30, 2022

If you have a balance owing, your payment is due on April 30, 2022. Some taxpayers may receive Notices of Redetermination from the CRA over the next two years that are related to Individual Emergency Benefits overpayments. If you receive such a notice, you should follow the payment directions provided in the letter.

If you or your spouse or common law-partner are self-employed, your payment is still due on April 30, 2022.

Since April 30, 2022, falls on a Saturday, in both of the above situations, your payment will be considered paid on time if we receive it, or it is processed at a Canadian financial institution, on or before May 2, 2022.

If you filed your 2020 return and qualified for interest relief, you have until April 30, 2022, to pay any outstanding income tax debt for the 2020 tax year to avoid future interest charges. This applies to the tax owing for the 2020 tax year only, and not for any previous tax year.

Partial payment

You can make partial payments to the Canada Revenue Agency (CRA) to reduce the amount of interest you need to pay on unpaid amounts. To see all the payment options or to make a partial payment, go to canada.ca/payments.

Payment arrangement

If you can’t pay your taxes in one payment, you may be able to set up a payment arrangement. A payment arrangement is an agreement between you and the CRA. It allows you to spread out your payments over time, based on your ability to pay, until you’ve paid your debt and interest in full. In order to help Canadians during the COVID-19 pandemic, the CRA has expanded its payment arrangement rules. These expanded rules are still in effect. You can work with us on a payment arrangement that fits your situation.

TeleArrangement service

You can also make a payment arrangement by calling the CRA’s automated TeleArrangement service at 1-866-256-1147. When you call, you’ll need to give:

  • your social insurance number;
  • your date of birth; and
  • the amount on line 15000 of your last notice of assessment.

The TeleArrangement service is available Monday to Friday (except holidays), from 7 a.m. to 10 p.m., Eastern time.

You can also call the CRA’s debt management call centre at 1-888-863-8657 to speak to an agent. Agents are available Monday to Friday (except holidays) from 7 a.m. to 8 p.m., Eastern time.

Pay by pre-authorized debit

You can authorize the CRA to withdraw a certain amount directly from your bank account, on dates of your choosing, through one of the following:

You can set up a pre-authorized debit agreement or generate a QR code for paying at a Canada Post outlet.

Keep in mind it takes five business days from when you first set up a pre-authorized debit to when your funds will be processed. Also, you can’t cancel the debit agreement within the five days before it’s due. To use this service, you need to register for My Account, My Business Account or the MyCRA mobile web app.

Unable to pay?

You must tell the CRA as soon as possible so that we can work with you to find a workable payment arrangement. Keep in mind that interest compounds daily, at the rate set by law, until you pay the amount you owe in full. Go to When you owe money – collections at the CRA for more information.

In some circumstances, you may ask for relief from penalties and interest, and reduce the amount you owe. Go to canada.ca/penalty-interest-relief for more information.

Cryptocurrency – Tax Implications

by

A cryptocurrency is a type of virtual asset that is protected using cryptography. It typically uses a system called a blockchain to record and keep a history of transactions. Cryptocurrencies, such as Bitcoin and Ether, are independent, meaning they do not rely on governments, central banks, or other central authorities for backing. You can obtain cryptocurrency in many ways, and new methods are being developed all the time. You can use cryptocurrencies for a wide range of activities, such as buying goods, paying bills, or investing. Transactions involving cryptocurrencies often have tax implications.

Disposing of cryptocurrencies

In general, possessing or holding a cryptocurrency is not taxable. However, there may be tax implications when you dispose of your cryptocurrency. Examples of this could include:

  • selling or trading it
  • giving it as a gift
  • converting it to government-issued currency, such as Canadian dollars
  • using it to buy goods or services

Examples of the tax consequences

The types of taxes that apply to your cryptocurrency transactions include taxes on:

  • Business income
    • Generally, if disposing of cryptocurrency is part of a business, the profits you make on the disposition or sale are considered business income and not a capital gain. Buying a cryptocurrency with the intention of selling it for a profit may be treated as business income.
  • Capital gains
    • If the sale of a cryptocurrency is not for carrying on a business, and the amount it sells for is more than the original purchase price or its adjusted cost base, then the taxpayer has a capital gain.
  • Goods and Services
    • Where a taxable property or service is exchanged for cryptocurrency, the GST/HST that applies to the property or service is calculated based on the fair market value of the cryptocurrency at the time of the exchange.

To ensure correct reporting, keep accurate records of your purchases and sales dealing with cryptocurrency, including records that show how you calculated the fair market value.

How to correct your tax affairs

If you did not report your income or capital gains from transactions in cryptocurrency, you may have to pay tax, penalties, and interest on that income or capital gain. You can avoid or reduce penalties and interest by voluntarily correcting your tax affairs. To correct your tax affairs (including corrections to GST/HST returns) and to report income that you did not report in previous years, you may:

More information

You can find more information on your tax obligations related to your cryptocurrency activities in the Canada Revenue Agency’s Guide for cryptocurrency users and tax professionals.