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Vince Iannello Shares his views on CRA new tax changes for 2022 personal taxes

A new year often brings with it tax changes. To help you know and prepare for any upcoming changes, Vince Iannello Owner of Iannello & Associates Professional Corporation has compiled a summary of the most significant federal tax changes that may affect your 2022 personal income tax return, as well as changes that may help you save taxes in 2022 and beyond.

Many COVID-19 benefits offered by the federal government are taxable. This includes the Canada Recovery Caregiving Benefit (CRCB), Canada Recovery Sickness Benefit (CRSB), and the Canada Worker Lockdown Benefit (CWLB) that were available in 2022. If you have received these benefits, the Canada Revenue Agency (CRA) will issue a T4A slip to report amounts paid to you under these programs, which you will need to take in in your income on the 2022 tax return. Some COVID-19 benefits offered by the provincial governments are also taxable. You must check to make sure that you have the relevant slips from your provincial government and include the taxable amounts in income on your 2022 tax return.

If you carry on an unincorporated business and acquired a capital property in 2022, you might be eligible to claim a 100% deduction of the expenditure this year. The instant expensing rules allow eligible individuals and partnerships to take a full deduction of up to $1.5 million of capital property acquired on or after January 1, 2022. The property should become available for use before 2025 and certain capital cost allowance classes are not eligible for the enhanced deduction.

The CRA is simplifying the process for individuals who want to claim the deduction for certain repaid federal COVID-19 benefits in the year the benefits were received, rather than the year the benefits were repaid, or split the deduction between those years. In 2022, Canadians will be able to take advantage of several new tax deductions and credits. such as:

Air quality improvement tax credit

If you were self-employed or a member of a partnership in 2022, you may be eligible to claim a refundable tax credit equals to 25% of your total ventilation expenses to improve ventilation or air quality at your place of business. 

Disability tax credit 

For 2021 and later tax years, an individual diagnosed with type 1 diabetes is deemed to have met the two times and 14 hours per week requirements for life-sustaining therapy.  

First-time home buyer's tax credit

The amount used to calculate the first-time home buyers' tax credit has increased to $10,000 for a qualifying home purchased after December 31, 2021.

Home accessibility tax credit 

The annual expense limit of the home accessibility tax credit has increased to $20,000. 

Labour mobility deduction for tradespeople

The labour mobility deduction provides eligible tradespeople and apprentices working in the construction industry with a deduction for certain temporary relocation expenses. Eligible individuals may be able to deduct up to $4,000 in eligible expenses per year. 

Medical expense tax credit (for surrogacy and other expenses)

The list of eligible medical expenses has been expanded to include amounts paid to fertility clinics and donor banks in Canada to obtain donor sperm or ova to enable the conception of a child by the individual, the individual's spouse or common-law partner, or a surrogate mother on behalf of the individual. In addition, certain expenses incurred in Canada for a surrogate or donor are considered medical expenses of the individual.

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Company Name: Iannello and Associates
Contact Person: Vince Iannello
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Country: Canada

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