On November 21, 2023 the federal government released its annual Fall Economic Summit.
Some of the key highlights to note are as follows:
Rental expense deduction for non-compliant short-term rentals
A new rule prevents short-term rental operators from claiming an income tax deduction for expenses incurred to earn short-term rental income in any province or municipality that has prohibited short-term rentals. The rule will apply to interest expenses as well as other types of rental expenses. An operator can also not claim income tax deductions for a short-term rental if they have failed to comply with provincial or municipal licensing, permitting, or registration requirements. These new restrictions will apply to all rental expenses incurred on or after January 1, 2024.
GST relief for psychotherapists’ and counselling therapists’ services
There will no longer be GST on psychotherapists’ and counselling therapists’ services. These practitioners will be added to the list of healthcare practitioners whose professional services are exempt from GST when rendered to individuals. This will be effective at a future date when the legislation passes Royal Assent.
No more Underused Housing Tax returns for 2023?
The proposed changes to UHT will mean most clients will no longer have to file UHT forms in 2023 and beyond. The changes include:
- Expansion of Excluded owners – Expansion of owners that are exempt from the UHT and the annual reporting obligations now include specified Canadian corporations, partnerships, and trusts effective for 2023 and subsequent calendar years.
- Reduction of Penalties – Reduction of the minimum failure to file penalties to $1,000 (from $5,000) per failure for individuals and to $2,000 (from $10,000) per failure for corporations, effective for 2022 and subsequent calendar years.
Say goodbye to surplus stripping with new GAAR rules
The government confirmed its intention to proceed with the GAAR rules changes to be effective January 1, 2024. See below for the previous discussion on the rule changes.
