2014 T1 Tax Update

1. 2014 T1 Tax
Update

2. 2014 Non-Refundable Tax Credits
Personal/Spousal/Eligible Dependent Amount $11,138
Age Amount $ 6,916
Amount for children under 18 $ 2,255
Disability Amount $ 7,766
OAS repayment threshold $71,592
Medical Expense Tax Credit – 3% of max NI ceiling $ 2,171

3. 2014 Automobile Rates and Limits
Amount deductible to the employer where tax-
free amount is paid to employee:
 $0.54 per km. for the first 5,000 km.’s
 $0.48 per km. driven after that
Maximum cost of passenger vehicle for CCA:
$30,000 plus applicable taxes
Maximum monthly lease amount is $800 plus
applicable taxes

4. 2014 Instalment Threshold
 At least $3,000 of taxes payable for both
the current year and either of the two
preceding years.

5. 2014 Federal Tax Changes
• Increase in the Fitness Tax Credit from
$500 to $1,000. (Arts Tax credit remains at
$500)
• Adoption expense credit has been
increased to a maximum 15% of $15,000.

6. 2014 Federal Tax Changes
Family Tax Cut
• This allows a limited form of income splitting
for couples with children under the age of 18.
Couples can enable a qualifying individual to
transfer up to $50,000 of taxable income to a
spouse in a lower tax bracket. Although, the
difference in tax relief received is capped at
$2,000.
• Done in Profile on Schedule 1A (just review
the schedule to ensure if they are eligible, it
has been automatically be filled out)

7. 2014 Federal Tax Changes:
Family Tax Cut Criteria for a Qualifying Individual (receive the
tax credit):
• Must be a Canadian resident at the end of the tax year
• Not be in jail for 90 or more days in the year
• Must be a spouse or common-law partner to the transferor
and the transferor must be a Canadian resident
• The couple must not be living apart because of
relationship breakdown.
• Both individuals must have filed an tax return in the year.
• Cannot be claimed if either person elects to split pension
income or becomes bankrupt.

8. Federal Tax Changes for 2014:
 The dividend tax credit rate for
non-eligible dividends and the gross up
amount has changed for dividends paid
after 2013.
2013 2014
Dividend Gross Up: 25% 18%
Tax Credit: 66.67% 72.3%

9. Federal Tax Changes for 2014:
 The lifetime capital gains exemption will
be increased from $750,000 to $800,000
 Search and Rescue Volunteer Tax Credit
A minimum of 200 hours of eligible service
in the year must be performed to be
eligible for the $3,000 credit

10. Federal Tax Changes for 2014:
 CRA can now go back 6 years if the T1135
has not been filed correctly or it has been
filed late (Prior to this, it has been 3 years)

11. 2014 B.C. Tax Changes:
Sales Tax Credit:
 As a replacement to HST, B.C. will re-
introduce the Sales Tax Credit that existed
prior to HST being implemented.
 $75 tax credit for each individual and their
spouse. The low income credit is reduced
by 2% of the net income (Greater than
$21,750 in household income will have $0
tax credit)

12. 2014 BC Tax Changes
 A new, top tax bracket on taxable
income over $150,000 with a tax rate of
16.80% (effective for 2014 and 2015)

13. BC Personal Tax Credits:
Children’s Fitness Credit:
 Same requirements for expenses as the
federal children’s fitness credit (except
only $500).
 $500 for each child 16 and under, 18 and
under if the child is entitled to claim the
disability credit.

14. BC Personal Tax Credits:
Children’s Arts Credit
 Same requirements as the federal
children’s arts credit.
 $500 for each child 16 and under, 18 and
under if the child is entitled to claim the
disability credit.

15. Staffing and Start Dates:
Immediately:
 Herbert
 Justin
 David
March 16th:
 Elaine
 Stephen
April 1st or earlier (clear all T2’s first):
 All other T1 Staff

16. Seniors Assigned to New Staff:
 Stephen - Paolo
 David K - Arthur
 Herbert - Spencer
 Justin - Ryan
All queries should be cleared and signed off
by the respective senior preparer.

17. Overtime
Starting March 16
 9.5 Hours Monday – Thursday
 4 Hours on Weekends

18. T1 Bags
 Green – Kelly
 Black – Gordon
 Red – Jason
 Blue – Michael
 Brown – Bill
 Orange – Scott
 Purple - David

19. T1 Preparation:
 T1013 must be signed by the client if we
do not have online access. The date
might need to be overwritten in profile to
ensure it matches the date on the copy
which was signed by the client.
 Ensure RTC is in a new envelope that is
clearly marked with the clients name and
has the RTC sticker on it.

20. T1 Preparation:
 Do not leave big issues for the reviewer,
you should be solving the issues before
the file is put into review.
 Highlight donation and medical
slips/receipts (amount, date, BN,
taxpayer)
 T-slips – please highlight the currency
reported.

21. T1 Preparation:
 Rental and business schedules – highlight
all numbers which you have entered into
profile

22. T1 Preparation:
Before the File is put into the Partner’s Office
 Print the T1 to Doc-it
 Print the file copy of the tax return (letter,
summary, comparative)
 Print the Doc-it Working Papers Binder to Doc-
it (Client supplied documentation including
the flow sheet)
 Print the client’s copy of the tax return
 Print the T183 and highlight Part E and F as to
where to sign