Energetic octogenarians are making headlines
On Nov. 30, 2020, the federal government released an economic statement titled Supporting Canadians and Fighting COVID-19. The release updated the fiscal costs of the pandemic and estimated this year's deficit to be $381.6 billion. For 2021, we can expect some pandemic relief programs to be extended and enhanced. Here are the highlights:
1. There will be an increase to the maximum Canada Emergency Wage Subsidy rate to 75 per cent until March 13.
2. The Canada Emergency Rent Subsidy will also be extended to March 13.
3. There will be new rules for the taxation of employee stock options, to be effective for stock options granted after June 30.
4. The Canada Child Benefit for eligible families with children under the age of six will be enhanced (to come out in early 2021).
5. A new simplified home office expense deduction for 2020 of up to $400. This flat-rate method will allow eligible employees to claim a deduction of $2 for each day they worked at home due to COVID-19 up to a maximum of $400 without a Form T2200 completed and signed by their employer. Quebec also announced it will parallel these federal changes for Quebec provincial 2020 income tax.
6. Extending the deadline to apply for the Canada Emergency Business Account loan for small business owners to March 31.
We expect to see more relief coming in the beginning of
2021 due to the resurgence of COVID-19, as well as the introduction of several new tax proposals. According to the economic statement, the federal government also plans to come down on those people trying to evade taxes, allocating additional resources to allow the CRA to fund new initiatives and extend existing programs targeting tax evasion and tax avoidance. A new modernized General Anti-avoidance Rule is also expected to be launched in 2021 to maintain the integrity of our tax system.
As well, the Canadian government is expected to target the unproductive use of domestic housing — that is, those Canadian homes owned by non-residents. This is expected to be an aggressive tax-based measure that will be seen nationally.
All in all, our government seems to be trying to support Canadians and of course we expect to have a few more challenges ahead, but we all must do our part. Whenever you can, shop locally with your neighbourhood coffee shop, bakery, grocery store and bookstore. Remember to chat with the owners and the staff to give them your encouragement and moral support. Kindness and patience are something we all should be giving out these days.