The Provincial Government is making changes to the Employment Standards with their Bill 17. Changes come into effect January 1, 2018, with the exception of the Youth Employment Standards which come into effect on May 1, 2018. Changes include the following:
The new changes now include eleven types of unpaid, job protected leaves. Employees are eligible for each of these leaves after 90 days of employment (up from one year).
Most Canadians, and no doubt all small business owners, have heard a lot over the past few months about “income sprinkling”. On December 12, 2017, the Department of Finance released its final proposals concerning this issue.
Here is what you need to know:
What it is not
- The proposed new measures are not directed at wages or salaries paid to family members. These amounts may be paid, and deducted by the business, if they are a reasonable business expense.
Holding a passive investment portfolio inside a private corporation
The current system allows for a tax deferral of the individual tax payable if the shareholder leaves funds in the corporation for passive investment purposes instead of being distributed to the shareholders, through taxable dividends or salary, for the shareholders to invest personally.
Converting a private corporation’s income into capital gains
Anti-surplus stripping rules
Changes are proposed to prevent individual taxpayers from using non-arm’s-length transactions that increase the cost base of shares of a corporation and avoid the application of Section 84.1. Section 84.1 is intended to prevent corporate surplus from being removed at the lower capital gains tax rates instead of the higher dividend tax rates where an individual sells shares of the corporation to a non-arm’s- length corporation.