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Financial reporting and accounting advisory services
You trust your external auditor to deliver not only a high-quality, independent audit of your financial statements but to provide a range of support, including assessing material risks, evaluating internal controls and raising awareness around new and amended accounting standards.
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Accounting Standards for Private Enterprises
Get the clear financial picture you need with the accounting standards team at Doane Grant Thornton LLP. Our experts have extensive experience with private enterprises of all sizes in all industries, an in-depth knowledge of today’s accounting standards, and are directly involved in the standard-setting process.
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International Financial Reporting Standards
Whether you are already using IFRS or considering a transition to this global framework, Doane Grant Thornton LLP’s accounting standards team is here to help.
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Accounting Standards for Not-for-Profit Organizations
From small, community organizations to large, national charities, you can count on Doane Grant Thornton LLP’s accounting standards team for in-depth knowledge and trusted advice.
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Public Sector Accounting Standards
Working for a public-sector organization comes with a unique set of requirements for accounting and financial reporting. Doane Grant Thornton LLP’s accounting standards team has the practical, public-sector experience and in-depth knowledge you need.
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Tax planning and compliance
Whether you are a private or public organization, your goal is to manage the critical aspects of tax compliance, and achieve the most effective results. At Doane Grant Thornton, we focus on delivering relevant advice, and providing an integrated planning approach to help you fulfill compliance obligations.
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Research and development and government incentives
Are you developing innovative processes or products, undertaking experimentation or solving technological problems? If so, you may qualify to claim SR&ED tax credits. This Canadian federal government initiative is designed to encourage and support innovation in Canada. Our R&D professionals are a highly-trained, diverse team of practitioners that are engineers, scientists and specialized accountants.
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Indirect tax
Keeping track of changes and developments in GST/HST, Quebec sales tax and other provincial sales taxes across Canada, can be a full-time job. The consequences for failing to adequately manage your organization’s sales tax obligations can be significant - from assessments, to forgone recoveries and cash flow implications, to customer or reputational risk.
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US corporate tax
The United States has a very complex and regulated tax environment, that may undergo significant changes. Cross-border tax issues could become even more challenging for Canadian businesses looking for growth and prosperity in the biggest economy in the world.
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Cross-border personal tax
In an increasingly flexible world, moving across the border may be more viable for Canadians and Americans; however, relocating may also have complex tax implications.
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International tax
While there is great opportunity for businesses looking to expand globally, organizations are under increasing tax scrutiny. Regardless of your company’s size and level of international involvement—whether you’re working abroad, investing, buying and selling, borrowing or manufacturing—doing business beyond Canada’s borders comes with its fair share of tax risks.
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Transfer pricing
Transfer pricing is a complex area of corporate taxation that is concerned with the intra-group pricing of goods, services, intangibles, and financial instruments. Transfer pricing has become a critical governance issue for companies, tax authorities and policy makers, and represents a principal risk area for multinationals.
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Succession & estate planning
Like many private business owners today, you’ve spent your career building and running your business successfully. Now you’re faced with deciding on a successor—a successor who may or may not want your direct involvement and share your vision.
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Tax Reporting & Advisory
The financial and tax reporting obligations of public markets and global tax authorities take significant resources and investment to manage. This requires calculating global tax provision estimates under US GAAP, IFRS, and other frameworks, and reconciling this reporting with tax compliance obligations.
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Transactions
Our transactions group takes a client-centric, integrated approach, focused on helping you make and implement the best financial strategies. We offer meaningful, actionable and holistic advice to allow you to create value, manage risks and seize opportunities. It’s what we do best: help great organizations like yours grow and thrive.
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Restructuring
We bring a wide range of services to both individuals and businesses – including shareholders, executives, directors, lenders, creditors and other advisors who are dealing with a corporation experiencing financial challenges.
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Forensics
Market-driven expertise in investigation, dispute resolution and digital forensics
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Consulting
Running a business is challenging and you need advice you can rely on at anytime you need it. Our team dives deep into your issues, looking holistically at your organization to understand your people, processes, and systems needs at the root of your pain points. The intersection of these three things is critical to develop the solutions you need today.
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Creditor updates
Updates for creditors, limited partners, investors and shareholders.
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Governance, risk and compliance
Effective, risk management—including governance and regulatory compliance—can lead to tangible, long-term business improvements. And be a source of significant competitive advantage.
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Internal audit
Organizations thrive when they are constantly innovating, improving or creating new services and products and envisioning new markets and growth opportunities.
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Certification – SOX
The corporate governance landscape is challenging at the best of times for public companies and their subsidiaries in Canada, the United States and around the world.
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Third party assurance
Naturally, clients and stakeholders want reassurance that there are appropriate controls and safeguards over the data and processes being used to service their business. It’s critical.
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ASPE Sec. 3041 Agriculture Understanding and applying the new ASPE Section 3041 AgricultureThe Canadian Accounting Standards Board (AcSB) has released new guidance on recognizing, measuring and disclosing biological assets and the harvested products of bio assets.
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Tax alert Agricultural Clean Technology ProgramThe Agricultural Clean Technology Program will provide financial assistance to farmers and agri-businesses to help them reduce greenhouse gas (GHG) emissions.
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Tax alert ACT Program – Research and Innovation Stream explainedThe ACT Research and Innovation Stream provides financial support to organizations engaged in pre-market innovation.
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Tax alert ACT Program – Adoption Stream explainedThe ACT Adoption Stream provides non-repayable funding to help farmers and agri-business with the purchase and installation of clean technologies.
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Builders And Developers
Every real estate project starts with a vision. We help builders and developers solidify that vision, transform it into reality, and create value.
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Rental Property Owners And Occupiers
In today’s economic climate, it’s more important than ever to have a strong advisory partner on your side.
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Real Estate Service Providers
Your company plays a key role in the success of landlords, investors and owners, but who is doing the same for you?
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Mining
There’s no business quite like mining. It’s volatile, risky and complex – but the potential pay-off is huge. You’re not afraid of a challenge: the key is finding the right balance between risk and reward. Whether you’re a junior prospector, a senior producer, or somewhere in between, we’ll work with you to explore, discover and extract value at every stage of the mining process.
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Oil & gas
The oil and gas industry is facing many complex challenges, beyond the price of oil. These include environmental issues, access to markets, growing competition from alternative energy sources and international markets, and a rapidly changing regulatory landscape, to name but a few.
Canadian families and businesses have remained resilient through economic volatility over the past few years. We anticipate continued challenges for many as the high cost of living—especially in housing and food—continues to put pressure on pocket books. However, the aggressive interest rate hikes have likely ended, and the Bank of Canada may begin lowering its key rate as early as the summer.
To support Canadians, the 2023 Fall Economic Statement focused on increasing housing and improving affordability. With affordability challenges continuing to dominate the public discourse and an election right around the corner, we expect Budget 2024 to include additional measures to boost the economy, create more homes, encourage further investment in small businesses, offset the carbon tax, and more. In advance of its release, here’s a closer look at what could be in Budget 2024.
Business tax measures
Investment incentives
Budget 2024 may extend temporary incentives to continue encouraging investments by small and medium-sized Canadian businesses.
In its submission, the Canadian Chamber of Commerce advocates to extend the accelerated investment incentive by postponing the phase-out period from 2024 to 2027. The federal government previously implemented temporary measures to incentivize businesses in Canada to invest in more capital assets; however, these measures are set to expire or phase out after 2023. These temporary measures include the immediate expensing rules, which permit Canadian businesses to immediately write-off some costs of certain capital property and the accelerated investment incentive which allows businesses to claim one and a half times CCA on net eligible property additions in the first year of purchase of the property. This allows a larger deduction within the first year of acquiring certain eligible depreciable assets.
We hope to see the federal government extend these temporary investment incentive measures for small and medium-sized businesses. If Budget 2024 includes any additional measures, we can assist in planning for the business's capital asset purchases to maximize the benefits.
Small business deduction
Budget 2024 may include additional relief for small businesses, including changes to the small business deduction.
Many small businesses in Canada have been struggling to overcome inflationary and economic challenges. The Canadian Federation of Independent Businesses provides several recommendations for the government to support small businesses in its pre-budget submission. Some of those recommendations include measures to:
- Increase the small business deduction threshold to $700,000 (from $500,000) and the amount of passive income a business could earn before reducing the small business deduction to $60,000 (from $50,000), and index those thresholds to inflation going forward.
- Lower the federal small business tax rate to 8% (from 9%) for at least the next two years to help businesses address challenges that arose during the pandemic.
- Freeze the carbon tax at its current level and find a way to deliver fuel charge proceeds collected under the federal carbon pollution pricing system back to small businesses.
As small- and medium-sized companies make up nearly 98% of all Canadian businesses, we welcome the introduction of additional measures that will help them thrive and contribute to our dynamic economy.
SR&ED program
Businesses could see changes to modernize and simplify Canada’s Scientific Research and Experimental Development (SR&ED) program in Budget 2024.
The Canadian Chamber of Commerce’s pre-budget submission recommends the federal government align the SR&ED tax credit criteria with the Income Tax Act, as the current criteria is more restrictive and discourages business investment and innovation. The federal government previously announced its review of the SR&ED program in Budget 2022—and reaffirmed this intention in Budget 2023—to improve the development, retention, and commercialization of intellectual property, which could include adopting a patent box regime.
We’d like to see Budget 2024 modernize the SR&ED program to increase access for small businesses. Potential measures that allow more small businesses to access the SR&ED program include a lower tax rate on income derived from patents or intellectual property, revised and expanded eligibility criteria, and less red tape.
Housing tax measures
Housing affordability
Budget 2024 may introduce additional measures to support the construction sector by cutting red tape and reducing barriers to building new homes faster.
With high interest rates and prices causing housing affordability challenges across Canada, the federal government’s economic plan will likely focus on supporting the construction of new homes, faster. The 2023 Fall Economic Statement introduced measures as part of Canada’s Housing Action Plan and stated that the federal government will continue to take action to accelerate the construction of affordable housing. These measures would add to the government’s recently introduced housing-related measures, such as the Tax-Free First Home Savings Account and enhanced GST rebate on purpose-built rental properties.
Further, in its pre-budget submission, the Canadian Home Builders’ Association recommends that the government reduce the pressure on the rental market by deferring the capital gains tax and the recaptured capital cost allowance on the sale of rental housing if the funds are used to reinvest in rental housing.
We’d like to see further measures announced in Budget 2024 that will provide more incentives—specifically for builders—to increase housing developments and alleviate the housing crisis in Canada.
Other notable tax measures
Tax reform
Budget 2024 may introduce measures to reduce unintended tax consequences and burden to taxpayers through tax reform.
The calls for tax reform in Canada have grown over the last few years, with CPA Canada leading the charge. The Canadian Chamber of Commerce and the Canadians for Tax Fairness have also joined the chorus, recommending that the federal government launch a comprehensive independent review of the tax system to make it fairer and more efficient. It’s been over 50 years since the government conducted a comprehensive tax review and many Canadians believe that the tax system is outdated.
We believe that a review of the tax system will provide clarity on newer complex rules that have increased the compliance burden on taxpayers, such as the underused housing tax rules and the mandatory disclosure rules.
Carbon tax
Some individuals and businesses could see additional relief from the federal carbon tax. The federal government stated they have no intention of removing the carbon tax, but they may introduce additional relief measures for some Canadians to address affordability. Some provinces are calling on the federal government to exempt all home heating fuels from carbon tax because of this affordability issue.
Any measures announced in Budget 2024 would be in addition to the federal government’s recently announced carbon price rebate and a temporary carbon price exemption for certain Canadians.
The federal government has previously stated that most households will receive more back in rebates than they pay in carbon pricing. To follow through on this commitment, we’d like to see the federal government take additional measures, like increasing the Climate Action Incentive payments either through a one-time supplementary payment or through additional quarterly amounts beyond those tied to inflation.
Alternative Minimum Tax
Budget 2024 could introduce new changes to the proposed Alternative Minimum Tax (AMT) rules to address unintended tax consequences on charities.
Recently proposed changes to the AMT rules were intended to ensure that Canadians pay their fair share in tax by preventing certain individuals and trusts from claiming exemptions, deductions, and tax credits that would generally be available under ordinary income tax rules. However, under the proposed rules, donors could be subject to unintended tax consequences, which could discourage charitable giving.
It’s possible that the federal government could release a revised version of these rules to address these unintended tax consequences, considering that AMT wasn’t included in Bill C-59 (which included several measures from the 2023 budget and the 2023 fall economic statement).
We hope the federal government revises the proposed changes to AMT to address these concerns; however, if Budget 2024 doesn’t include changes to the rules, we can help donors plan their charitable giving to limit the impact of these rules.
Regulating crypto assets
Budget 2024 may include measures to allow for the collection of information from crypto-asset service providers.
In a joint statement with many countries, Canada has announced its intention to implement the Organization for Economic Cooperation and Development’s (OECD) crypto-asset reporting framework into domestic law to allow for exchange agreements beginning in 2027. To keep up with the rapid growth of crypto assets and Canada’s role in hosting active crypto markets, crypto-asset service providers may begin to see more disclosure requirements to report certain transactions.
The regulation of crypto assets can help protect investors. We welcome additional measures aimed at regulating the evolving and developing crypto market.
Alcohol excise duty
Budget 2024 could extend relief on alcohol excise duties.
Beer Canada’s pre-budget submission recommends that the federal government freeze beer excise duties at the 2023 rates for 2024, and until inflation returns to the Bank of Canada’s target of 2%. Alcohol excise duties are normally indexed to inflation each year, and with current inflation rates, the duties are expected to increase by 4.7% starting April 1, 2024. A large increase was also scheduled for 2023 but the federal government announced a temporary measure to cap the increase at 2% for one year in Budget 2023.
Excise taxes indexed to inflation can provide certainty with respect to tax increases; however, in a high-inflationary environment, indexed taxation—particularly on products—compounds price increases. We hope that the federal government will, at minimum, cap the increase again this year.
Hybrid mismatch arrangements
Budget 2024 may include additional measures to combat certain cross-border tax plans.
The hybrid mismatch rules aim to prevent “double non-taxation" in certain cross-border transactions. The federal government has taken steps to implement legislative proposals that are generally consistent with global recommendations from the OECD and has already released the “first tranche” of hybrid mismatch rules in 2022. There’s a possibility the “second tranche” may be released in Budget 2024 and could include measures to address:
- double deductions (where a taxpayer claims tax deductions in more than one jurisdiction on a single expense),
- branch mismatches (where the country of a taxpayer’s residence takes a different approach than the country of a taxpayer’s branch regarding the allocation of income and expenditures between them),
- reverse hybrid arrangements (where an entity is treated as transparent in the country where it’s established but as opaque by a foreign investor’s country), and
- imported mismatches (where an entity resident in one country deducts a payment and the recipient entity resident in a second country includes the payment in ordinary income, but that ordinary income is set off against a deduction under a hybrid mismatch arrangement between the second entity and an entity resident in a third country).
We hope that the federal government will provide additional commentary on these proposed rules to clarify how they will impact cross-border tax structures.
A transitional year
Canadian families and business will need to be resilient and agile in 2024 as the economy tries to rebalance after years of volatility. We expect that Budget 2024 will extend support to help the taxpayers that need it, but wealthy individuals and large corporations may face higher tax and compliance burdens. Contact your Doane Grant Thornton advisor or reach out to us here to prepare for these incoming rules or to understand how you or your business may be affected.
Visit our Budget 2024 hub to learn more about all federal and provincial budgets.
Disclaimer
The information contained herein is general in nature and is based on proposals that are subject to change. It is not, and should not be construed as, accounting, legal or tax advice or an opinion provided by Grant Thornton LLP to the reader. This material may not be applicable to, or suitable for, specific circumstances or needs and may require consideration of other factors not described herein.
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