The CRA list the service enhancements and major changes below, including announced income tax changes that were not law. If they become law as proposed, they will be effective for 2018 or as of the dates given.
1. For residents of Manitoba, New Brunswick, Ontario, and Saskatchewan
2. Home relocation loan deduction
3. Medical expenses
4. Donation and gifts
5. Tax on split income (TOSI)
6. Investment tax credit
7. Accelerated Investment Incentive
The CRA’s services
Your income tax package has a new look. The 2018 Income Tax Package includes the Federal Income Tax and Benefit Guide, a Provincial or Territorial Information Guide, the return, schedules, and worksheets. Several changes were made to the package to save paper and enhance services.
These changes include:
- using plainer language where possible
- reducing the amount of instructions in both guides by moving some information to the return, schedules, forms, or other publications
- reducing the number of schedules by eliminating schedules 4 and 12. You can now find any charts that were on these schedules on the worksheets
- updating worksheets to include needed calculations that were previously found in the guide
- creating a specific worksheet for: the return, Schedule 1, Form 428, and Form 479
- presenting the package in order of importance and in numerical order. You still have two copies of the return and related schedules – a copy to send to the CRA and a working copy for your records
PayPal – You can make your payments using PayPal through a third party service provider. For more information, go to Payments to the Canada Revenue Agency.
For residents of Manitoba, New Brunswick, Ontario, and Saskatchewan - The Climate Action Incentive is a new refundable credit available as of January 1, 2018. For more information, see Schedule 14, Climate Action Incentive.
Employee home relocation loan deduction (line 248 of the return) – As of January 1, 2018, this deduction has been eliminated.
Medical expenses (lines 330 and 331 of Schedule 1) – Eligible medical expenses have been expanded to include a variety of expenses relating to service animals specially trained to perform specific tasks for a patient with a severe mental impairment.
Donations and gifts (line 349 of Schedule 1) – As of January 1, 2018, the first-time donor’s super credit has been eliminated.
As of February 27, 2018, registered universities outside Canada will no longer need to be prescribed in Schedule VIII of the Income Tax Regulations. For more information on qualified donees, see Pamphlet P113, Gifts and Income Tax.
Tax on split income (TOSI) (line 424 of Schedule 1) – As of January 1, 2018, in addition to applying to certain types of income of a child born in 2001 or later, TOSI may now also apply to amounts received by adult individuals from a related business. Where TOSI applies, the disability tax credit can now be used to reduce the individual’s tax payable for the year. However, income that is subject to TOSI must now be added to the individual’s net income for the purpose of calculating various deductions, credits and benefits. For more information, see Form T1206, Tax on Split Income.
Interest and investments
Investment tax credit (line 412 of Schedule 1) – Eligibility for the mineral exploration tax credit has been extended to flow-through share agreements entered into before April 2019. See Form T2038(IND), Investment Tax Credit (Individuals).
Accelerated Investment Incentive
The Fall Economic Statement 2018 introduced an accelerated deduction for Canadian development expenses (CDE) that a flow through share (FTS) investor receives from a principal business corporation (PBC). This tax measure applies to FTS agreements entered into after November 20, 2018 in regards to CDE incurred after the agreement date.
If you have invested in a FTS after November 20, 2018 and have received a statement of resource expenses from a PBC, you may claim CDE at the rate of 45% in the tax year in which such CDE is renounced to you and, thereafter, at a rate of 30%. See Form T1229, Statement of Resource Expenses and Depletion Allowance.
For more information, go to Accelerated Investment Incentive.