Posted by & filed under Personal Tax.

Description: There have been numerous stories in the media recently letting Canadians know that they will be taxed on benefits provided by the federal government during the COVID crisis. Benefits such as the Canada Emergency Response Benefit (CERB) and the Canada Emergency Student Benefit (CESB) did not have tax removed at source, meaning Canadians who have received them may have to do some juggling when taxation time rolls around. Jamie Golombek of CIBC Wealth Management offers advice on how a contribution to an RRSP might help you cut the amount you owe to the federal government.

Date:  February 19, 2021

Source:  financialpost.com

 Link: https://financialpost.com/personal-finance/taxes/how-an-rrsp-contribution-can-help-reduce-tax-owing-on-any-covid-related-benefits

Discussion points:

1) Did you receive the CERB, the CESB, or any similar benefit from the federal government in 2020?

2) Have you made any contributions to an RRSP previously? Could a contribution before the March 1 deadline help you reduce or eliminate any tax payment on your total income for 2020?

3) Wiley’s Financial Accounting: Tools for Business Decision-Making, deals with the subject of payroll liabilities beginning on page 10-6. Read this section of the text and determine what accountants mean by the phrase “at source.”

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