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Some 2013 Federal Budget Highlights


Lifetime Capital Gains Deduction: It is proposed to increase the Capital Gains Deduction available on sale of Qualified Farm Property including farmland and Qualified Small Business Shares from $750,000 to $800,000 effective January 1, 2014. It is also proposed to index the exemption to inflation every year thereafter.

First Time Donors Super Tax Credit

First time donors will receive a 25% additional charitable donation tax credit on donations of up to $1000. Anyone who has not donated to charity in the last 5 years is considered a first time donor.

Dividend Tax Credit.

Commencing in 2014 a dividend tax credit change results in dividend income received from your corporation being taxed at a slightly higher rate than before.

Deduction of Safety Deposit Box

Safety deposit boxes will no longer be deductible for tax purpose

Phase out of Labor Sponsored Venture Capital Corporations Tax Credit

For 2013 and 2014 tax years the Federal Credit will remain at 15%, for 2015 it will drop to 10% and again in 2016 it will drop to 5% and phase out in 2017.

Restricted Farm Losses

It is proposed that in order for farm losses to be fully deductible against other income, any off farm income must be "subordinate" to farming income. If such is not the case then the first $2500 of the farm loss will be deductible, and 50% of the remaining loss is deductible in the year to a maximum loss deductible of $17,500. Unused farming losses from the current loss year may be carried back 3 years or ahead 20 years to be applied against farm income only.