2023 federal budget—What you need to know
As you may know, the government tabled the federal budget on Tuesday, March 28 and our tax experts were there to explore how it might impact you.
Hot off the press: the 2023 CIBC federal budget report is now available, and we’ve also provided a short video (with transcript) to help you understand what it means for you. Also, here are three key takeaways I think may be relevant to you:
- Alternative minimum tax (AMT) – To expand the AMT to more high-income individuals, several changes will be made to the calculation of AMT, beginning in 2024. The changes include broadening the AMT base by further limiting tax preferences (such as exemptions, deductions, and credits), increasing the AMT exemption, and raising the AMT rate.
- Intergenerational share transfers – In June 2021, Bill C-208 introduced an exception to the surplus stripping rules to facilitate legitimate intergenerational business transfers. A proposal was made to further amend these rules to ensure that they apply only where a genuine intergenerational business transfer takes place. This would take effect for transactions that occur starting in 2024.
- Employee Ownership Trusts (EOTs) – An EOT is a form of employee ownership where a trust holds shares of a corporation for the benefit of the corporation’s employees. To launch EOTs in Canada, amendments to the Income Tax Act are required. The budget defines an EOT and sets out proposed rules on how an EOT will operate. The EOT amendments are to be effective as of January 1, 2024.
Please feel free to get in touch with me if you have questions.