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Money Monitor: Company cellphones may cause new tax headache
New guidelines from Canada Revenue Agency suggest employers may have to look at how much of the cost of company- supplied electronic devices can be attributed to their commercial activities. While there's a potential for use of company-supplied phones to be considered a "personal taxable benefit" several tax experts say that's not new. They add that the tax rules also give employers ways to minimize the impact on their employees. Thom Damstra, Toronto-based founder of data analytics firm MobilityView expects companies will soon have to provide more documentation to the CRA.He says they will do this if they want to get credits to reduce the taxes that the business has to pay itself. He says that the CRA guidelines suggest at least 10 per cent of a mobile phone's usage is for commercial purposes to qualify for the GST/HST credits and that even above that threshold, the CRA says tax credits must be proportionate to commercial usage. RSM Canada LLP has noticed that CRA audit teams have become much more zealous with business clients over the past 18 to 24 months. RSM Canada warned clients that CRA's auditors have been assuming all taxable supplies are subject to the max GST/HST rate of 15 per cent. RSM says CRA auditors have also been denying all claims for input tax credits. Input tax credits can reduce how much GST or HST a company pays on supplies, unless there's sufficient documentation about commercial activity.
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The Canadian Press
1920px × 1080px 82MB
10/11/2019 3:49:00 PM