Resource: Worldwide Personal Tax and Immigration Guide 2021-22

Resource: Worldwide Personal Tax and Immigration Guide 2021-22

Governments worldwide continue to reform their tax codes at a historically rapid rate. Taxpayers need a current guide, such as the Worldwide Personal Tax and Immigration Guide, in such a shifting tax landscape, especially if they are contemplating new markets.

The content is straightforward. Chapter by chapter, from Albania to Zimbabwe, we summarize personal tax systems and immigration rules in more than 150 jurisdictions. The content is current on 1 July 2021 with exceptions noted.

Keep up-to-date on significant tax developments around the globe with the EY Global Tax Alert library. Only some of the chapters in this Tax Guide reflect COVID-19 tax policy measures. The United Kingdom chapter provides information regarding Brexit. Readers should obtain updated information regarding Brexit before taking actions.

Each chapter begins with our in-country executive and immigration contact information, and some jurisdictions add contacts from our Private Client Services practice. Then we lay out the essential facts about the jurisdiction’s personal taxes. We start with the personal income tax, explaining who is liable for tax and, at some length, what types of income are considered taxable and which rates, deductions and credits apply. A section on other taxes varies by jurisdiction but often includes estate, inheritance, gift and real estate taxes. A social security section covers payments for publicly provided health, pensions and other social benefits, followed by sections on tax filing and payment procedures as well as double tax relief and tax treaties. The immigration sections provide information on temporary visas, work visas and permits, residence visas and permits, and family and personal considerations.

At the back of the guide, you will find a list of the names and codes for all national currencies and a list of contacts for other jurisdictions.

This resource is available through EY.com

Click HERE to go directly to their website to download the full report

 

2022 Automobile Allowance Rate 

2022 Automobile Allowance Rate 

Current 2022 automobile allowance rate

The automobile allowance rates for 2022 for trips made after January 1st, 2022 are:

  • 61¢ per kilometre for the first 5,000 kilometres driven
  • 55¢ per kilometre driven after that
  • Note that in the Northwest Territories, Yukon, and Nunavut, there is an additional 4¢ per kilometre allowed for travel.

Here is the CRA announcement of the 2022 mileage rates where you can read more.

Quick Guide: Selecting a company structure for your new business

Quick Guide: Selecting a company structure for your new business

How to Select a Business Structure

Choosing how you structure your business is one of the bigger decisions you’ll make as you set up your new business. The type of structure you decide on will depend on whether you want to run the business solely as a trade name, partnership, or with associates as a limited corporation. Learn more about each type of business structure, along with the advantage and disadvantages of each.

It’s important to keep in mind that you are not locked into the structure you choose. You can change how you structure your business as your business grows, so feel free to start off as a trade name or partnership, and switch to a limited corporation later. You can also move from an incorporation to a trade name or partnership.

Why Choose a Trade Name?

  • Also referred to as a sole proprietorship
  • A form of un-incorporated business that’s owned and operated by one individual/entity, with no legal distinction between the owner and the business
  • Business owner is fully responsible for all profits and losses
AdvantagesDisadvantages
One of the simplest forms of all business structuresNo ownership or protection of the business name
Low start-up costsBusiness owner has unlimited liability
Limited obligation after registrationMay be difficult to raise capital for the business as there are no shareholders/investors
Business owner is in direct control of decision-making and receives all profits associated with the businessLack of continuity in absence of owner
Potential tax advantage for the ownerBusiness cannot change ownership or continue without the owner

Why Choose a Partnership?

  • A form of un-incorporated business in which two or more individuals/entities combine their resources to form a company with the intent to make a profit
  • Structure is similar to that of a trade name, with the business owners fully responsible for all profits and losses
AdvantagesDisadvantages
One of the simplest forms of all business structuresNo ownership or protection of the business name
Low start-up costsBusiness owner has unlimited liability
Limited obligation after registrationEach owner responsible for and must assume the consequences of the actions of the other partner(s)
More than one owner allows for additional resources for investment
Multiple owners offers a broader management base

Why Choose a Limited Corporation

  • The most common form of incorporated business in Alberta
  • Protects the owners (shareholders) of the corporation from majority of liabilities
  • Allows shareholders to profit from the success of the corporation, without them being personally responsible for the debts, obligations or acts of the other shareholders of the corporation, except in rare circumstances
AdvantagesDisadvantages
Owners have limited liabilityMore expensive to organize and create than trade name or partnership
Ownership is transferrableBusiness will be closely regulated
Corporation is a separate legal entity and has the same rights, protections, and responsibilities under the law as individuals doSetting up as a corporation requires extensive record keeping and increased maintenance fees
Easier to raise capital through the sale of shares
Have ownership of the incorporated name
May be perceived as more stable than un-incorporated companies
Changing You Spending Habits

Changing You Spending Habits

It is every one dream being a millionaire and retiring with a healthy bank account, but how many people can actually achieve it? So few. This is largely due to lack of discipline in building up their retirement fund and poor spending habits. While building a retirement fund requires time, you can accelerate the process by making incremental but positive changes in your spending habits. Here are seven ways that you can change your daily lifestyle for more positive results in your spending habits:

1. Have you ever noticed how much time you spend sitting in front of the television? The longer you sit, the worse it is for your blood circulation. Besides, the time you free up can be used for more useful tasks such as teaching your kids or learning a new skill.

2. If you are an avid reader, use the public library whenever possible. There is no need to buy the latest books from bookstores like Borders unless it is in a category that does not fit into a public library. The public library will usually acquire popular titles after some times. Learn to be patient.

3. If you are a smoker, start reducing the number of cigarettes you smoke each day. Over time, you may be able to quit smoking completely. Besides saving money by not buying any more cigarettes, your health will also improve and this means a huge saving in your medical bills.

4. Use a bicycle if the destination is within 30 minutes by car. This helps promote blood circulation in your body and also reduces environmental pollution. You can also save on gasoline and parking fees.

5. Dine at home more frequently. You can experiment with different recipes and save some money at the same time. In addition, you are honing your cooking skills and this could be very useful for the home dining experience.

6. Bring your own coffee to office. Many people like to drop by a Starbucks or similar coffee outlet and end up spending a few dollars or more on a cup of coffee. You can potentially save many dollars each week just by making your own coffee at home and bringing it to your work place in a Thermos. Besides, who knows, it may taste better than the coffee from Starbucks! If you really cannot live without Starbucks coffee, consider getting a Starbucks rebate card. You can use the rebates to redeem free Starbucks coffee after you have accumulated enough points.

7. Do more walking than driving. If you can reach your destination within ten minutes by car, consider leaving the car behind and walk instead. You will save money on gasoline and parking fees. This can easily add up to a few thousand dollars a year.

These seven ways are a good start for changing unhealthy spending habits. However, you should continue to research and incorporate more healthy habits that contribute to the building of your retirement fund. By re-investing the money saved from using these tips, you will be many steps ahead of your peers and closer to your retirement goals.

Tips On How To Save Money

Tips On How To Save Money

Money is an essential element in every body’s life. It is the one that we exchange to get all the necessary things in life. And that is exactly the reason why we work all day and sometimes night. Since the flow of money in one’s life is not uniform, it is only prudent to save some money for the crunch days. Economics permits one to spend his/her money in any amount as he/she wishes. But how rationally one could plan so as to maintain a minimum level of backup in any given day is directly linked with his/her ability to save.

In daily life, even if we know that we are spending money to buy things we need, most of us tend to over see the fact that more than 50% of the spending is for purposes that are quite unnecessary or those expenditures can be avoided without affecting one’s basic life style. Exactly this is the point from where one should start thinking of saving money.

Distinguish between and clearly understand your needs and wants. Needs are those things one require to sustain his/her basic needs. Want on the other hand refers to anything that is not an absolute necessity but which presence enhances one’s way of life. For example, a car can be a need but a $40,000 SUV is a want.

It is a human nature to insist on the best and the biggest even if the same quality is available at a lower cost. Spending $100 in a posh restaurant when one can afford the same sumptuous meal at $20 or buying a $20 shirt with a $30 trendy label attached all belong to this category of “keeping up with the Joneses”. A bit of intelligent spending here can save a lot.

It is a good idea to try a commodity and get a feel of it before actually buying one. Because there is no point in buying something you may never use or hardly use. Such an analysis is relevant especially when the item under consideration is a costly one. Rent one, borrow one, and try one out before making the final call.

Mortgages can easily be the biggest single expense most families have in their monthly budget. Here, zeroing on the best deal is where the trick lies. Calculated comparisons can make a difference of few thousand dollars in the entire deal. Another big expense is linked with the vehicles a person owns. One should see if he/she is getting the best deal on the maintenance, insurance and repairs.

True, food is a need as well as a recurring expense. Keeping a check over the money spend on food – to a necessary extend – can make a big difference in the money one could save at the end of the month. Plan food purchases in advance, go for generics or store brands and stock up the items that you regularly use when available on sale.

Another expenditure that drains a lot of money is one’s fascination for clothes. Unlike electronic goods, the price of clothes is continuously on an upward spiral. Hence it is a good idea to buy quality clothes that lasts a longer period. Such clothes are better than the ‘throw away’ types. The cost of clothes is not going to come down either. Therefore, buying in advance for a season ahead is a logical correct step. But never over do it. Getting clothes for 5 years in advance is stupid!

Telephone is a common thing in every house hold. This is one department where money drains like an open tap. Though local phone service has a fixed price long distance calls matters. Shop around to find out the best deal as far as the service provider is concerned. Keep in mind, a saving of $16.75 a month can add up to $200 a year.

If you are a travel addict, travel expenses can make a big difference if not having the right travel agent. Even if it is the same place, airline, hotel or car rental, the difference between two travelers can easily exceed $1000. Keep one’s eyes and ears open when hunting for a traveler.

Remember, saving money is not putting all the dollars that one earns in his/her savings account. But it is all about intelligently spending the bucks, at the same keeping a check on all the unnecessary expenses. Good Luck!

Attendant care and care in a facility – Medical Expenses

Attendant care and care in a facility – Medical Expenses

Attendant care and care in a facility

Attendant care is care given by an attendant who does personal tasks which a person cannot do for themselves. This includes care in certain types of facilities.

You can claim amounts paid to an attendant only if the attendant met both of the following criteria:

  • They were not your spouse or common-law partner.
  • They were 18 years of age or older when the amounts were paid.

An attendant who is hired privately will probably be considered an employee. For more information, see Guide RC4110, Employee or Self-employed?

Who can claim these expenses

You can claim as medical expenses the amounts you or your spouse or common-law partner paid for attendant care or care in a facility. The expenses must have been paid for the care of any of the following persons:

  • yourself
  • your spouse or common-law partner
  • your dependant

A dependant is someone who depended on you for support and is any of the following persons:

  • your or your spouse’s or common-law partner’s child or grandchild
  • your or your spouse’s or common-law partner’s parent, grandparent, brother, sister, uncle, aunt, nephew, or niece who lived in Canada at any time in the year

Amounts you can claim as medical expenses

Full-time care or specialized care

Generally, you can claim the entire amount you paid for care at any of the following facilities:

  • nursing homes (full-time care)
  • schools, institutions, or other places (providing care or care and training)

We consider care to be full-time care when a person needs constant care and attendance.

Other places could include an out-patient clinic, such as a detoxification clinic; however, they do not include a recreational facility, such as a residential summer camp, even if it caters to persons with disabilities.

Note

Generally, you cannot claim the entire amount you paid for a retirement home or a home for seniors. However, you can claim salaries and wages for care in such facilities if the care recipient qualifies for the disability tax credit (see Salaries and wages).

What we mean by nursing home – A nursing home is generally a facility that gives full-time care, including 24-hour nursing care, to individuals who are unable to care for themselves. Any facility could be considered a nursing home if it has the same features and characteristics as a nursing home.

All regular fees paid for full-time care in a nursing home or for specialized care or training in an institution are eligible as medical expenses, including fees for all of the following:

  • food
  • accommodation
  • nursing care
  • administration fees
  • maintenance fees
  • social programming and activities fees

However, extra personal expenses (such as hairdresser fees) are not eligible.

Salaries and wages

You may be able to claim the fees for salaries and wages paid for attendant care or care or supervision in any of the following facilities:

  • self-contained domestic establishments (such as your private home)
  • retirement homes, homes for seniors, or other institutions that typically provide part-time attendant care
  • group homes in Canada
  • nursing homes – special rules apply to this type of facility, see the chart

Eligibility for the disability tax credit may be a requirement to claim fees for salaries and wages as medical expenses. See the reference to Form T2201 on the chart.

Expenses you can claim

You may be able to claim as medical expenses the salaries and wages paid to all employees who do the following tasks or services:

  • food preparation
  • housekeeping services for a resident’s personal living space
  • laundry services for a resident’s personal items
  • health care (registered nurse, practical nurse, certified health care aide, personal support worker)
  • activities (social programmer)
  • salon services (hairdresser, manicurist, pedicurist) if included in the monthly fee
  • transportation (driver)
  • security for a secured unit

If you are receiving attendant care in your home, you can only claim for the period when you are at home and need care or help. For an expense to be eligible as a medical expense, you must either:

  • be eligible for the disability tax credit
  • have a written certification from a medical practitioner that states the services are necessary

Expenses you cannot claim

You cannot claim the cost of any of the following:

  • rent (except the part of rent for services that help a person with daily tasks, such as laundry and housekeeping)
  • food
  • cleaning supplies
  • other operating costs (such as maintenance of common areas and outside grounds)
  • salaries and wages paid to employees such as administrators, receptionists, groundskeepers, janitors (for common areas), and maintenance staff

Special rules when claiming the disability amount

There are special rules when claiming the disability amount and attendant care as medical expenses. For information on claiming attendant care and the disability amount, see the chart.

Calculate your net federal tax by completing Step 5 of your tax return to find out what is more beneficial for you. You can also see the examples.

If you claim the fees paid to a nursing home for full-time care as a medical expense on line 33099 or 33199 of your tax return (Step 5 – Federal tax), no one (including yourself) can claim the disability amount for the same person.

You can claim the disability amount together with the portion of the nursing home fees that relate only to salaries and wages for attendant care (up to the limit indicated in the chart). However, you must provide a breakdown of the amounts charged by the nursing home showing the portion of payments that relate to attendant care.

For more information on the disability tax credit and how to claim the disability amount, go to Disability tax credit.

Documents you need to support your attendant care expenses

Receipts

Receipts must show the name of the company or individual to whom the expense was paid. If an individual issues a receipt for attendant care services, the receipt must include his or her social insurance number.

Certification

You may need to provide a certification to claim amounts paid for attendant care as medical expenses. To determine which type of document you need, see the chart.

Detailed breakdown

To claim attendant care expenses paid to a facility such as a retirement home, you have to send us a detailed breakdown from the facility.

The breakdown must clearly show the amounts paid for staff salaries that apply to the attendant care services listed under Salaries and wages – Expenses you can claim.

The breakdown should also take into account any subsidies that reduce the attendant care expenses (unless the subsidy is included in income and is not deductible from income).

Examples of the detailed information we need
Developing A Successful Home Budget

Developing A Successful Home Budget

This is probably the most requested topic that I receive, normally after someone gets a large unexpected expense, or they start thinking about retirement and realize that they have saved a woefully inadequate amount of money.

I recommend using a monthly time-frame to look at your cash inflows and outflows, because most bills are monthly and four weeks is a short planning period that most people can manage. The first thing to do is determine your monthly after-tax income. Usually, this is the amount of money from your paycheck that gets deposited into your checking account. If your income is variable, then use an average of the last three months. (Any savings account interest income would be a bonus.) Next, list out your fixed monthly expenses, such as rent, mortgage, car payment, phone, electric bill, etc. All of these numbers can be changed in the long-term, but first you need to determine a baseline budget of where you are right now.

Make sure you include all of your utilities; some are only paid quarterly or annually, like car insurance, the water bill, or an association fee. Take these expenses and calculate what they would be on a monthly basis. For example, if your water bill comes quarterly, divide it by 3. If you have semi-annual car insurance, then divide it by 6.

So now you have your fixed monthly income and your fixed monthly expenses. Deduct one from the other, and you have the variable amount of money that you are free to spend any way you want for the remainder of the month. From this remaining amount of money, start listing out your main categories of variable spending: groceries, entertainment, medical expenses, clothing, dry cleaning, personal care (haircut, nails, etc.), and gifts. Take each of these variable expenses and put an amount next to them that you think represents your average monthly spending for that category.

Make as many subcategories as you need to make an accurate estimate. The more precise it is for your spending habits, the more effective it will be for you. For example, food can be broken down by grocery store/fast food/dining out/work lunch/etc. Then go through the last few months of your checkbook and credit card statement looking for any spending that hasn’t been covered so far that you need to include for your situation.

Now you should have a total number for your monthly income, total monthly fixed expenses, and total monthly variable expenses. The moment of truth is when you deduct the two expenses from your income to see if there is anything left over. Don’t panic if it is a negative number – it is far better to discover this out now, rather than building up credit card debt later. Most people comment somewhere along this process, “Oh, so that is where my money is going. I had no idea I spent so much on that!”

Seeing all the numbers in black & white can help you prioritize (and negotiate with all the other spenders in the family). From this beginning budget, you can start to set monthly targets for spending categories, you can focus on reducing the largest expenses, and find areas where you should start doing some price-comparison shopping. And did I mention that saving a 5-15% of your income should be an additional fixed expense? Yes, you need to pay yourself first!

Having a budget is the critical first tool in managing your money. Wielding this tool allows you to finally start making financial decisions based on the facts instead of fiction. You can plan for expenses instead of being caught by surprise. And most importantly, figure out how to move forward with goals like a big vacation, a new car, or investing.

Do You Have A Plan For Sticking To Your Budget

Do You Have A Plan For Sticking To Your Budget

So you’ve made your budget and it looks good on paper. Great! Now it is time to implement it. But are you ready to follow the budget you’ve developed? Here are some helpful tips to keep you on track with your budget.

1. Determine why you made a budget. There is a reason you have put time into developing your budget, now you need to put into writing what your goals are. Do you want to be debt free, live on one income, or save for retirement? Make this into your personal or family financial mission statement. Write it down or type it up nicely and then have it laminated and display it in a prominent place where you can see it often. Many times we just need a reminder to ourselves for why we are doing a particular thing, and that can be just enough incentive when things get tough.

2. Set small range goals so you can see progress. It can be very difficult to keep up the discipline necessary to stay on budget if you can’t see any measurable progress. Develop some short term goals that you can celebrate meeting. If your goal has been to reduce your grocery spending by $100 per month, then your weekly goal would be to cut grocery costs by $25. Likewise, if your goal is to pay off debt, make a chart to show how much you’ve paid off. Reward charts just aren’t for children! Use a type of chart where you can color in a bar to show your progress, and then color it in every time you make a payment so you can see the progress you are making. Put it up on your refrigerator or bathroom mirror as a reminder that your hard work is paying off!

3. Identify your weak spots and develop a plan to battle them. In sticking to your budget, you need a clear idea of where you may be tempted to break the budget. If you are prone to impulse spending, then you must remove that temptation from yourself. If you go window shopping, leave your credit cards and check book at home! Especially in the early days of sticking to your budget, it is important to re-train yourself to curb spending.

Making a budget is really the easy part in financial management. It is sticking to the budget and making your spending match your plan that is the difficult process. By disciplining yourself and retraining your spending habits, you can achieve your budget goals.

Top 10 Ways To Cut Spending

Top 10 Ways To Cut Spending

Do you run out of money before you run out of month? Do you wonder where your money goes each month? Do you struggle to find money to invest for retirement, emergencies and other financial goals? Here are 10 tips to cut your spending and stretch your dollar to the max:

1. Consider dropping your home telephone line. Your cell phone is probably all you really need, and most likely it has free long distance. You could save $30 or more per month by dropping your “land line”.

2. Cut back on trips to Starbucks or other premium coffee shops. Often called the “latte factor”, spending several dollars per day on luxuries like premium coffee can really add up. For example, if you spend $4 for a cappuccino five times a week for 50 weeks out of the year (you’re on vacation the other two weeks), you would spend $1,000 in a year. Try treating your trip to Starbucks as a treat instead of a habit. You’ll save money and probably lose weight too!

3. Pay your mortgage payment bi-weekly instead of monthly. You’ll pay less interest and pay off your mortgage faster.

4. Carry cash instead of credit cards. Psychologically it’s harder to spend cash than it is to use the credit card. You’ll spend less and save on interest charges.

5. Use the “envelope system” for groceries, dining out, entertainment, and other discretionary spending categories. This will help you track how much you spend in these categories as well as prioritizing your spending.

6. Raise the deductible on your homeowners and auto insurance policies. It’s not wise to file claims for small losses anyway (insurance companies love to raise rates after you file a claim), so a higher deductible will save you money now and in the future.

7. Buy regular gas instead of premium. Most cars don’t need premium gasoline. Also, take public transportation if it’s available in your area. Take advantage of “park and ride” and carpooling options.

8. Plan your purchases to avoid impulse buying. Take a list with you to the grocery store and stick with it. Studies show that impulse buying can add $10-50 to your grocery bill – ouch!

9. Go to the library instead of the bookstore. If you’re an avid reader, give yourself a book budget for books that you will want to keep, and go to the library for everything else.

10. Take a vacation at home. Check out all the local sites and happenings. You’ll rediscover your hometown and save on travel and hotel costs.

These are just a handful of ways you can cut spending and stretch your dollars, but if you follow these tips you’ll discover you have more money at the end of each month to apply to other financial goals, such as saving for college, retirement or just for a rainy day.

Do It Yourself Financial Planning

Do It Yourself Financial Planning

The fight for financial freedom isn’t fair. No matter what kind of spin you try to put on it, the path to comfortable living seems either impossible or too long to attempt. Many people these days are spending copious amounts of money going to see professional financial planners for advice on how to get their money situation under control. But let’s be honest, while a financial planner can show you how to prioritize your spending and how to go about consolidating your debt, surely there must be a way to plan your finances that doesn’t cost you visits to a professional? This article has been written to open some people’s eyes to the fact that it is possible to properly plan your finances from the comfort of your own home.

The main aim when planning your finances is to make everything as simple as possible. There is nothing worse than sinking so far into depression that you can’t see a way out. Whether you are in debt and looking to get out of it of if you are simply looking for a way to keep a little more spending money aside each month, the simpler you make your planning the better the result you will get. From the beginning, you need to be realistic. I’ll start with the example of a single income situation, firstly you need to calculate what your net pay is per month. If you’re self employed or not on a regular pay, always calculate the worst-case-scenario, what is the lowest you might get paid. Then go through your monthly bills and write down the ones that are a fixed amount. Do the same for all other bills but use the worst-case-scenario again, what is your estimation of the most that those bills might be. Add everything up and subtract it from your net income total.

Next onto the incidental expenses you might run into on a monthly basis. These might include petrol, car upkeep, public transport fares, food etc. make a list of all the little expenses you might need money for in a month. Even things that you’re not sure you might need to buy. Don’t add general spending money to the list, be specific. Always add more to the totals if you’re not sure as you can fine tune it later. Again, subtract your total from the money left over from your bills. Don’t worry if you’ve gone into the negative figures here, we can fix it.

Once you’ve got your expenses total in front of you, obviously any money that is left over is your profit for the month. In the event that you have nothing left or have gone into the minus figures, the next step is to minimize your expenses. Pretty straight forward, huh? Any incidental expenses that you might not need, remove them. And any expenses you know you will have, like food and petrol for example, really get down to the lowest spend on them. How much do you really need to spend on them? Your aim should be to save at least $50 per month after spending money. All that extra builds up and gives you a nice petty cash at the end of a few months!

If you are in a multiple-income situation, the same process applies. You need to start building up that petty cash tin. There will always be unexpected expenses, everyone knows that. In truth, the basis of comfortable living is really the knowledge that you can afford to pay for something unexpected.

To finish, all of this can be done on a piece of paper if you want to invest a little time, or you can lay it all out on an Excel spreadsheet. The way that saves the most time is to use a Financial Planning software program, you enter the numbers and the program gives you an automatic monthly planner. Whatever way you choose to go, always remember to keep it as simple as possible. When you’re following a plan, the pressure on you will decrease. What more could there be to comfortable living?