Jim Pearcy & Company Ltd.
#201-3025 Anson Avenue V3B 2H6 Coquitlam, BC, Canada

An Ode to Income Splitting by Robins Appleby LLP Share: 'Twas the middle of July, with days so hot and hazy... When the Feds announced new tax rules, which some said were so crazy With complicated language and broad applications They targeted the shareholders of private corporations And whilst giving all small business owners an undeserved scare It was all done in the name of having them pay their "fair share" The pundits all weighed in, with criticism abound They wrote articles and letters, decrying the measures as unsound And as Summer turned to Fall and pressure grew and grew The number of proposed changes shrunk from many to just a few But with still so much uncertainty and so much left unclear Finance promised us an update before the end of the year And on December 13th, as the days drew short and cold We received an early Holiday gift amended proposals to behold! The aim was to simplify "TOSI", the rules on "income splitting" An "advantage" from which Finance said the wealthy were benefitting To address this serious issue that they sought to mitigate They expanded the scope of "split income", taxed at the top marginal rate The aspect of the July proposals which caused the most confusion Was how one should interpret the "reasonableness" exclusion So within its December bundle of revised legislation Finance sought to simplify the rules on "split income" taxation And while the rules remain broad, and many will still be caught Numerous exclusions now specify some persons who will not Like the business owner who has turned age 65-plus And can split income with her spouse without causing a fuss Or the child who has now reached 18 years of age And works in his father's business but has been "actively engaged" Before December's updates this definition was not precise But now we know that 20 hours per week will suffice If you're 25 and own 10% of a business which provides no service Your dividends are not "split income" there's no reason to be nervous With respect to qualified shares of a small business corporation Sales will not be caught by "TOSI" a cause for celebration! The proposals also explain that if you die while owning shares Your past labour, contributions, and business risks will accrue to your heirs Now if none of these exclusions apply, please do not be stressed The new rules still contain the good 'ole "reasonableness" test Just account for the business contributions of all the proper actors And assess labour, capital, risk and, of course, "other relevant factors" So if your head is spinning now and you feel like you can't see Be thankful for the Tax Group at Robins Appleby With experience and expertise we will guide you through this maze So that you and your family can enjoy some Happy Holidays!

Finance Minister Bill Morneau to release small-business tax details as MPs break for holidays Finance Minister Bill Morneau will release details about the government's small-business tax changes today.The new tax rules are set to go in effect on Jan. 1 and details regarding the changes have been long-awaited. The Liberals have been criticized by the other political parties and business groups throughout the tax-reform process and were met with heated opposition from doctors, small-business owners and farmers. Specifically, details are expected to show how the Canada Revenue Agency will decide when "income sprinkling" is allowed. The House of Commons will rise as early as today for a six-week recess, meaning that Mr. Morneau won't be questioned by opposition MPs until lawmakers return in late January.

Can you believe this?