2019 Federal Budget Summary

April 1, 2019

The 2019 federal budget includes a number of tax measures that will affect Canadian taxpayers. Below, we list areas of change that most individuals are interested in when it comes to the management of their wealth.

  1. Canada Training Credit – introduces a new refundable tax credit
  2. Home Buyers’ Plan – announces an increase to the withdrawal limit for first time home buyer
  3. Digital Subscriptions Tax Credit – announces a temporary, non-refundable 15% tax credit
  4. Automatic Enrolment for Canada Pension Plan Retirement Benefits – includes a change to age entitlement to as early as 60
  5. Employee Stock Options – states that qualifying employee stock options will be taxed at a preferential rate
  6. Registered Disability Savings Plans (RDSPs) – announced that RDSPs can continue to remain open (although contributions will not be permitted) even if the beneficiary becomes ineligible for the Disability Tax Credit
  7. Annuities for Registered Plan Holders – a proposal that permits two new types of annuities: advanced life deferred annuities (“ALDA”) and variable payment life annuities (“VPLA”)
  8. Individual Pension Plans (IPP) – proposes to prohibit IPPs from providing retirement benefits for past years of employment that were pensionable service under a Defined Benefit Pension Plan of a prior employer
  9. Donations of Cultural Property – provides a special tax incentive to encourage donations of cultural property to museums and public art galleries
  10. Mutual Funds – limited anti-avoidance rule tax changes that will not impact the majority of retail mutual funds.
  11. Real Estate Enforcement and Administration – provides the CRA with $50 million over five years, to create four new dedicated residential and commercial real estate audit teams to address tax non-compliance in real estate transactions  in high risk areas.

As always, you’re welcome to call me for details of how this may affect the management of your wealth. For more information and to read the full report, please click here.