Interruption insurance didn’t cover Snowmageddon

7 days without customers is a devastating blow to small businesses

It’s been a month since the state of emergency was lifted in St. John’s, but the headache continues for some small business owners whose insurance claims were denied.

Peg Norman, who owns the Travel Bug and Bee’s Knees stores on Water Street, said her shops were shuttered for a week in January as the city cleaned up from nearly a metre of snow.

Even though the city’s state of emergency made it illegal for businesses to open, she was told she didn’t qualify for business interruption insurance.

“I just assumed that if I wasn’t able to operate because of no fault of my own that my insurance would kick in and cover that expense,” Norman said.

While her insurance covered losses due to things like floods, fires and damage to neighbouring buildings, Norman said it didn’t cover closures due to a state of emergency.

Norman said there was a clause that allowed interruption insurance to pay out if damage to city infrastructure prevented her from opening. The road closures still didn’t qualify.

‘There has to be some consideration’

The city has granted small businesses an extension on paying their taxes this year, but Norman said in the end they’ll still have to pay the same amount and deal with the losses incurred from a week without sales.

“I don’t expect the city to give me any big break or anything, but I think that there has to be some consideration. Small business in this province, and small businesses of this city in particular, is the backbone of the city.”

Dave Hopley, co-owner of Rocket Bakery and Johnny Ruth, also took a major revenue hit during the state of emergency.

“That seven days of sales, we’ll never get back,” he said. “Our costs keep going. We don’t get a timeout on our rent or our taxes or anything like that. It’s just another expense added to the bottom line.”

Hopley said his businesses were also denied on their interruption insurance claims.

“I didn’t really expect that they would cover it,” he said.

“Grin and bear it, I guess. It’s difficult to fight back against insurance companies. They’ve got their policies and all their clauses.”

The only recourse would be to hire a lawyer and fight it in court, but Hopley figured any potential gains would only be eaten up by legal fees.

READ MORE HERE: 

Source: CBC

 

Canada’s tax season kicks off and with a simplified paper return

The Canada Revenue Agency is sending an unlikely message to kick off tax season: Paper-filers, we have not forgotten you.

Despite a years-long push to have more people file taxes online because it’s generally faster and easier, many Canadians still prefer putting pen, or pencil, to paper.

The people who prefer paper to online are getting particular attention because they tend to be Canadians whose tax files are needed to send them essential benefit payments.

There are seniors who need old-age security, parents eligible for the Canada Child Benefit and first-time filers who might be eligible for a new benefit for low-income workers.

Because of that, the CRA has made changes to the paper tax booklet to further simplify language, add notes about new benefits for the 2019 tax year, and include a checklist so nothing gets missed.

Frank Vermaeten, the CRA’s assistant commissioner, said the agency wants to make sure those who prefer paper are still comfortable using it amid wider pushes to electronic filing.

“Certainly, we promote electronic filing — we see a lot of benefits for Canadians in doing that, but we also want to be sure that paper filers are served and served well,” Vermaeten said in an interview.

The federal tax collector expects to handle about two million paper returns this calendar year out of roughly 26 million filings.

Even at the current rate people are shifting to digital filing and away from paper, Vermaeten said the CRA could see paper files for another 20 years.

The agency’s tax machine fired up in earnest Monday, with new staff joining call centres that run at extended hours.

About 1.6 million printed tax-return booklets are also being mailed out that include an option for some to file by phone if their incomes are largely unchanged from year to year, such as seniors.

Staff have also been hired to manage paper filers, including a team that searches for errors and corrects them.

Vermaeten said a new service will see staff input forgotten T4 slips, for instance, on paper returns filed before the deadline, to save taxpayers interest penalties.

ICBC and police remind drivers to “take a break” from their phones

February 27, 2020

Since 2014, more than one in four fatal crashes on B.C. roads have involved distracted driving, which is why ICBC and police continue to combat this dangerous driving behaviour that claims 76 lives each year.*

This month, drivers will be hearing one message – take a break from your phone when you’re behind the wheel. Not only is it dangerous, but the costs can add up quickly.

One distracted driving ticket is $368 plus four penalty points ($252) for a total of $620. And this number vastly increases to more than $2,500 if you get a second distracted driving ticket within 12 months. Yet tough penalities haven’t deterred some drivers, with an average of 1,335 drivers receiving multiple tickets every year.**

If you want to save your money for something more fun, remember to leave your phone alone while driving.

Police across B.C. are ramping up distracted driving enforcement during March, and community volunteers are setting up Cell Watch deployments to remind drivers to leave their phone alone. The campaign also features advertising and social media support.

Drivers can do their part by avoiding distractions while driving and encouraging others to do the same. Activate Apple’s Do Not Disturb While Driving feature or what’s similarly available on other devices. Free ‘not while driving’ decals are available at ICBC driver licensing offices and participating Autoplan broker offices for drivers to support the campaign and encourage other road users to leave their phones alone.

You can get tips and statistics in an infographic at icbc.com.

Quotes:

Chief Constable Neil Dubord, Chair of the BC Association of Chiefs of Police Traffic Safety Committee

“Distracted driving continues to be a serious issue in our province – it’s the number one cause of crashes. Police officers see distracted drivers on the roads in every community. We are stepping up efforts making sure people leave their phones alone while driving.”

Lindsay Matthews, ICBC’s Vice-President Public Affairs & Driver Licensing

“Using electronic devices, like smartphones, is one of the most common and riskiest forms of distracted driving. Safer roads start with every driver making a conscious decision to focus on the road and leave their phones alone. Let’s all do our part to create a safer driving culture in B.C.”

Regional statistics*:

  • Every year, on average, 26 people are killed in distracted driving-related crashes in the Lower Mainland.

  • Every year, on average, nine people are killed in distracted driving-related crashes on Vancouver Island.

  • Every year, on average, 29 people are killed in distracted driving-related crashes in the Southern Interior.

  • Every year, on average, 12 people are killed in distracted driving-related crashes in the North Central region.

*Police data from 2014 to 2018. Distraction: where one or more of the vehicles involved had contributing factors including use of communication/video equipment, driver inattentive and driver internal/external distraction.

**Annual average based on 2016 to 2018 ICBC data.

 

4 tricks the wealthy use to reduce taxes that ordinary Canadians can try

4 tricks the wealthy use to reduce taxes that ordinary Canadians can try

The excerpted article was written by Julia Mastroianni | Financial Post

 Here are a few ideas:

Sheltering investment income

For any Canadian with the ability to save money, sheltering income from the taxman in one of the two main savings vehicles the government makes available is a no-brainer.

David Rotfleisch, founding tax lawyer of Toronto firm Rotfleisch and Samulovitch, recommends Registered Retirement Savings Plans (RRSPs) to everyone.

“You should be putting away the maximum you can into your RRSP. That in and of itself is the most important tax-saving tip and it’s available to everyone,” he said.

Contributions to an RRSP are tax-free, meaning you don’t have to pay any income tax on them in the year of the contribution. The funds can also be invested with no tax on gains until the age 71 — at which point a taxpayer must begin to withdraw funds, which are then treated as taxable income.

Tax-free savings accounts (TFSAs) are another option. While the money you contribute to your TFSA will be post-tax income, any interest, dividends or capital gains earned in it are tax-free for life, and you won’t have to pay taxes on the withdrawals.

Wealthy Canadians use these accounts too, though Jamie Golombek, managing director of tax and estate planning at CIBC, said they might use them a bit differently. They’re likely maxing out their RRSPs and TFSAs by contributing the yearly limit — but they aren’t stopping there.

“What the wealthy are doing beyond that is they are actually using TFSAs to fund for their children once the children reach the age of 18,” Golombek said. “So some wealthy families are giving money to their kids at 18 to encourage the kids to put money into their own TFSAs. And what that does is it’s able to transfer wealth intergenerationally while keeping all the investment income tax-free.”

Incorporating

Many wealthy Canadians run a side business (or their own business) for the benefits of lower tax rates, business write-offs and tax-deductible individual pension plans.

If you run a business, are self-employed or doing freelance and contract work, it’s worth considering incorporation. Barrett said the choice should depend on how you use the income you’re earning.

“If all the income that’s coming in is being consumed by you every year, then there’s no advantage,” he said. But if the money you’re making through self-employment, even if it’s a small side business, is extra money for you, incorporation has its benefits. The 2019 small business tax deduction rate was nine per cent after the federal tax abatement, meaning you’d be taxed at the much lower corporate rate on your income.

Before you incorporate, Rotfleisch said to evaluate whether it’s worth your time and money. “Incorporation costs a couple of thousand dollars, but then you have your accounting costs to do the financial statements and tax returns and that’s going to cost you around $1,500 dollars,” he said. “So you have to decide if it’s worth spending that for the other tax benefits.”

Income-splitting and prescribed rate loans

While this strategy is particularly effective for wealthier Canadians within the highest tax bracket, there are benefits for the average Canadian too. If one spouse is in a higher tax bracket than another, they may want to shift some of that taxable income to another family member, including children.

However, in Canada, if you just loan money to a family member, the money will be attributed back to you on your tax returns. Instead, you would need to set up a prescribed rate loan with the Canada Revenue Agency-approved interest rate (currently two per cent). As long as the family member pays that interest rate to you every year, the money you’ve loaned will count under their tax return. When loaned to a child or spouse who doesn’t earn any income, that money then becomes taxed at the lowest tax bracket.

Permanent life insurance

Most Canadians are familiar with term life insurance, which provides temporary coverage for a set time. Permanent life insurance, on the other hand, lasts for life. This life insurance comes with an investment component that grows free of annual taxation.

However, it’s not quite accessible to the average Canadian, as it’s sometimes six to 10 times the cost of term life insurance. Permanent life insurance is usually an additional investment option for the wealthy who have already maxed out their RRSPs, TFSAs and other investment options and know that they have extra income that they’d rather not pay taxes on every year.

Jennifer Poon, director of advanced planning at Scotia Wealth Management, said that this is an option normally favoured by wealthier Canadians because it’s a long-term investment. “You can’t always just lock up all your cash in a life insurance policy because this is a tax shelter,” she said.

Ultimately, Barrett noted, the more money you have, the more tax planning you can do with it. Average Canadians can try out these strategies, but the savings won’t come close to the thousands and millions that the wealthiest are saving every year.

But with the right planning, savings are still possible.

“Even if you’re making 60 grand a year, and you’re smart and you’re frugal, and you’ve done all your tax planning properly, you can still get some really good savings that may be meaningful to you at that kind of an income level,” he said.

The BC Securities Commission has announced the appointment of Gordon Johnson as its new vice-chair

The excerpted article was written by James Burton

The British Columbia Securities Commission has announced the appointment of Gordon Johnson as its new vice-chair.

Brenda Leong, chair and CEO, said: “It’s my pleasure to welcome Gordon to the BCSC. We will surely benefit from Gordon’s wealth of experience, especially in the areas of capital markets and administrative law.

“His insights and perspectives as a seasoned practitioner will be invaluable in helping to guide our regulatory policy and tribunal decisions.”

A BCSC press release detailed how Johnson has more than 30 years of securities law and senior litigation experience. He was a partner at Borden Ladner Gervais LLP (BLG), where he focused on both prosecuting and defending clients on regulatory issues and investment claims, and dealing with disputes between investment firms.

He also has significant experience in administrative law, having appeared as counsel before many tribunals, including tribunals of the BCSC, as well as before the British Columbia Supreme Court and the British Columbia Court of Appeal. Johnson served on BLG’s national board for six years.

NFP unifies brokerages under its brand

NEW YORK, N.Y. — NFP Canada Corp., an insurance broker serving the needs of the trucking industry, is unifying its Canadian businesses under the “NFP” brand, further integrating acquired brokerages.

The company announced Tuesday that several of its Canadian brokerages, including Capital Benefit Financial Group, Corporate Benefits Analysts Insurance Agency, Consortia Group, PBL Insurance Limited, Dalton Timmis Insurance Group, Mass Insurance Brokers, McLean Hallmark Insurance Group, Elective Benefits Services and Indemnis Trade Risk Management, will adopt the NFP name.

This implementation marks the latest in a series of strategic initiatives of NFP Corp. across North America, the company said.

“We are thrilled to come together under the NFP brand and unify our operations in Canada,” said Greg Padovani, president of NFP in Canada.

“The integration of these well-established firms creates a platform for NFP that has the size, scale, and capabilities to provide a full range of insurance solutions to Canadian corporations and individuals.”

NFP is one of the top 10 Canadian brokerages, with 750 employees.

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