TAX ALERTS
PRESCRIBED LEASING INTEREST RATE FOR AUGUST 2024
The Canada Revenue Agency (CRA) requires the prescribed leasing interest rate to be determined using bond yield data available on the Bank of Canada website. This calculation indicates that the prescribed interest rate for leasing for August 2024 will be 4.39%.
​
Detailed instructions from the CRA on calculating the prescribed interest rate for leasing, including a link to the relevant bond yield data, can be found at How to calculate Prescribed Interest Rates for Leasing Rules - Canada.ca.
​
INCREASE IN OVERALL INFLATION RATE FOR MAY 2024
Statistics Canada's latest Consumer Price Index release indicates that the overall inflation rate for May 2024 was 2.9%, up from 2.7% in April, measured year-over-year.
​
In May, the primary driver of inflation was a 4.6% year-over-year increase in the cost of services, particularly rent, cellular services, travel tours, and air travel. The year-over-year change in the cost of goods remained steady at 1.0%, consistent with April's rate.
For detailed information on the inflation rates by index component and province, please refer to the June release of the Consumer Price Index available on the Statistics Canada website at The Daily — Consumer Price Index, May 2024 (statcan.gc.ca).
Link: https://www150.statcan.gc.ca/n1/daily-quotidien/240625/dq240625a-eng.htm?HPA=1&indid=3665-1&indgeo=0
NEW TAX CREDIT AND BENEFIT YEAR BEGINS JULY 1, 2024
The federal and provincial governments offer eligible taxpayers various refundable tax credits and benefits. These benefits are typically disbursed monthly or quarterly and are received tax-free by the recipients.
​
Eligibility for a specific benefit and the amount received generally depend on individual and family income from the previous year, with benefit years spanning from July 1 to June 30. The new benefit year will commence on July 1, 2024, with eligibility and benefit amounts based on the income reported in the 2023 tax return.
​
Individuals who have not yet filed their 2023 tax return may experience an interruption in their benefit payments; however, payments will resume once the return is filed. More information on available refundable tax credits can be found on the federal government website at https://www.canada.ca/en/services/taxes/income-tax/personal-income-tax/help-others/outreach/tax-related-benefits-credits-deductions-support.html.
INCREASE IN OLD AGE SECURITY BENEFIT AMOUNTS FOR THIRD QUARTER OF 2024
The Old Age Security (OAS) benefit for Canadian residents aged 65 and older is adjusted quarterly in line with changes in the Consumer Price Index.
​
The federal government recently announced that for the third quarter of 2024 (July to September 2024), this indexation will result in a 0.7% increase in OAS benefit amounts. Consequently, OAS recipients under 75 can receive a maximum benefit of $718.33, while those aged 75 and older are eligible for a maximum benefit of $790.16.
​
For more details on OAS benefit amounts and income thresholds, please visit the federal government website at https://www.canada.ca/en/services/benefits/publicpensions/cpp/old-age-security/payments.html.
PRESCRIBED LEASING INTEREST RATE FOR JULY 2024
The Canada Revenue Agency (CRA) requires the prescribed leasing interest rate to be determined using bond yield data from the Bank of Canada website. According to this calculation, the prescribed interest rate for leasing for July 2024 will be 4.65%.
​
Detailed instructions from the CRA on calculating the prescribed leasing interest rate, including a link to the relevant bond yield information, are available at How to Calculate Prescribed Interest Rates for Leasing Rules - Canada.ca.
​
INCREASE IN CAPITAL GAINS TAX EFFECTIVE JUNE 25, 2024
As outlined in the 2024-25 federal budget, the proportion of capital gains included in taxable income will rise from 50% to 66.6%, effective for gains realized after June 24, 2024.
​
This adjustment applies to all capital gains realized by corporations and to capital gains exceeding a $250,000 threshold annually for individuals.
​
Further details on the changes to the capital gains tax rules can be found on the Finance Canada website at https://www.budget.canada.ca/2024/report-rapport/chap8-en.html.
SLIGHT INCREASE IN UNEMPLOYMENT RATE FOR MAY
The latest Statistics Canada Labour Force Survey indicates a slight rise in the unemployment rate for May, which reached 6.2%, up from 6.1% in April 2024.
​
Employment saw increases in Ontario, Manitoba, and Saskatchewan, while it declined in Alberta, Newfoundland, and Prince Edward Island.
​
For more detailed information on the unemployment statistics by demographic group, industry, and province, please refer to the May release of the Labour Force Survey available on the StatsCan website at The Daily — Labour Force Survey, May 2024 (statcan.gc.ca).
​
Link: https://www150.statcan.gc.ca/n1/daily-quotidien/240607/dq240607a-eng.html
PRESCRIBED INTEREST RATES FOR 2024
The Canada Revenue Agency (CRA) has released the interest rates applicable to amounts owed to and from the Agency for the first three quarters of 2024, as well as the rates to be used for calculating taxable benefits for employees and shareholders.
Additional details of interest rates charged and paid by the CRA can be found on the Agency's website at Interest rates for the third calendar quarter - Canada.ca.
Link: https://www.canada.ca/en/revenue-agency/services/tax/prescribed-interest-rates/2024-q2.html