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Moonlighting can be a great way to use your skillset to bring in some extra cash on the side. For some, it may also be a way to justify writing off some otherwise “personal” expenses, such as expenses for the business use of a work space in your home, for tax purposes. But be forewarned — if you don’t operate your business in a commercial manner or it’s deemed that there is a significant personal element associated with your so-called “business,” any losses you incur from that business may be denied by the taxman.

Take, for example, the recent case involving an Ontario accountant who was employed, full-time, by a local municipality from March 2005 through May 31, 2007, as its treasurer, chief financial officer and ultimately, as chief administrative officer. In 2007, the year under review by the Canada Revenue Agency, the taxpayer earned nearly $83,000 of employment income from the municipality.

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While it comes too late for retiring Baby Boomers, the generations that follow will benefit nicely from the newly “enhanced” Canada Pension Plan (CPP).

Higher premiums to fund it began this month. Once fully phased in almost half a century from now, CPP will replace 33.33 per cent of the average worker’s lifetime earnings to a higher pensionable earnings limit of $65,400 (rounded down, 2019 dollars.)

That compares to a replacement of pre-retirement earnings up to 25 per cent of the current Year’s Maximum Pensionable Earnings limit (YMPE) of $57,400 in effect in 2019. The boost means the maximum pension will eventually be 50 per cent higher than before, according to CPP expert Doug Runchey, of Vancouver Island-based DR Pensions Consulting.

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One of the advantages of being self-employed is the ability to write off a variety of business expenses against your income. In some cases, those expenses may even lead to a loss that may be used against other income of the current year or carried back up to three years. That loss can also be carried forward for use against future income for up to 20 years.

But are the expenses from a business you no longer operate and from which you have no expectation of future profits still tax deductible?

That issue came before the Tax Court in a recent case involving a retired Nova Scotia lawyer who deducted professional dues of $57 and file storage fees of $1,200 as expenses on her 2015 tax return. The Canada Revenue Agency allowed her annual dues, but it disallowed her storage fees.

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Jamie Golombek: Here's what to do now to reap significant tax savings when you file your 2018 tax return next spring

With just days to go before Dec. 31, here’s some last-minute tax-planning ideas to contemplate during the final week of the year that could reap significant tax savings when you file your 2018 tax return next spring.

Tax-loss selling

With the recent tumult in financial markets, you may actually have some accrued losses sitting in your non-registered portfolio this year. If so, consider some last-minute tax-loss selling, which involves selling investments with accrued losses at, or close to, year end to offset capital gains realized elsewhere in your portfolio. This Thursday, Dec. 27, is the last trade date in order for your transaction to settle in 2018.

It’s critical that your trade settle in 2018 if you want to use your loss against other capital gains realized this past year, including using it to offset capital gains distributions you may have just received this past week from your non-registered mutual funds.

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It seems like nearly everyone you talk to these days is a landlord or is thinking of becoming one. While some of us may simply rent out our basement to bring in extra income to help cover the mortgage, others are forgoing more traditional retirement savings vehicles such as RRSPs and TFSAs for the allure of investing in residential real estate. After all, why not collect some rental income to help offset some of the expenses with a view to disposing of the real estate in a future year, hopefully at a significant profit?

Some people even boast of the tax benefits associated with being a landlord, as they seek to use any rental losses generated from their rental properties to reduce taxes owing on other income, such as employment or business income.

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