Year-end tax planner – 2022: Helping individuals and owner-managed businesses save tax

The Year-end tax planner is designed primarily for individuals who have accumulated some wealth or own their own businesses (large or small). It includes nine year-end tax planning checklists and several tables of useful information.

What's new?

Small business deduction – eligibility expanded, for taxation years beginning after April 6, 2022, to Canadian-controlled private corporations (CCPCs) with up to $50 million of taxable capital employed in Canada

CCPCs and substantive CCPCs – a private corporation that is not a CCPC could, in certain cases, be considered a “substantive CCPC” and treated similarly to a CCPC for purposes of its investment income taxation

Mandatory disclosure rules – enhanced rules proposed to apply to taxation years that begin, and transactions entered into, after 2022

Investment tax credit for carbon capture, utilization and storage (CCUS) – new refundable tax credit for eligible expenses relating to the purchase and installation of eligible CCUS equipment, starting 2022

Excessive interest and financing expenses limitation regime – deductibility of interest and financing expenses limited for certain taxpayers, for taxation years beginning after 2022

Tax-free first home savings account – new registered account proposed, starting in 2023

Underused housing tax – new annual 1% tax on the unproductive use of certain Canadian residential property owned by non-Canadians, effective January 1, 2022

Residential property flipping rule – profits arising from certain dispositions of residential properties owned for less than 12 months will be deemed to be business income, starting in 2023

Luxury tax – new tax on luxury vehicles, aircraft and vessels, effective September 1, 2022 

 

Small business corporate rates

  • Prince Edward Island – decreased from 2% to 1% on January 1, 2022
  • Saskatchewan – to remain at 0% for 2022 and then increasing to 1% on July 1, 2023 and 2% on July 1, 2024

Personal income tax rates

  • Newfoundland and Labrador – increased for taxable incomes over $139,780, starting in 2022, and changed for eligible and non-eligible dividends in 2022
  • Prince Edward Island – increased for non-eligible dividends in 2022
  • Quebec – increased for non-eligible dividends in 2022
  • Saskatchewan – decreasing gradually for non-eligible dividends from 2023 to 2025

Beneficial ownership registries – provincial requirements for certain privately held companies to maintain ownership registries implemented in New Brunswick (effective June 10, 2022), Newfoundland and Labrador (effective April 1, 2022) and Ontario (effective January 1, 2023); already implemented or planned in other provinces

Land transfer tax

  • Nova Scotia – 5% additional tax imposed on non-residents of Nova Scotia buying residential real property, for agreements of purchase and sale entered into after March 31, 2022
  • Ontario – non-resident speculation tax expanded to apply provincewide and rate increased from 15% to 20%, effective March 30, 2022; rate further increased to 25%, effective October 25, 2022

 

Year-end tax planning checklists

Working with your PwC adviser is essential when considering the following year-end tax planning tactics. In addition to tax considerations, your financial plan should reflect investment philosophies, sound business practices and motivational goals. Owner-managers should ensure that sufficient funds are retained to meet business objectives; given the uncertainty in the economic environment, cash flow management is especially important.

Related services and content

Contact us

Sabrina Fitzgerald

Sabrina Fitzgerald

National Leader for Private Clients, PwC Canada

Tel: +1 613 755 5904

Luigi De Rose

Luigi De Rose

Private Tax Markets Leader, PwC Canada

Tel: +1 905 418 3421

Nadja Ibrahim

Nadja Ibrahim

Calgary Private Partner, Tax, PwC Canada

Tel: +1 403 509 7538

Jean-François Thuot

Jean-François Thuot

Partner, PwC Canada

Tel: +1 514 205 5272

Follow PwC Canada