Please Note Our Holiday Shutdown

The offices of Ward & Uptigrove will be closed from 4:00 pm on Wednesday, December 24th and reopening in the New Year on Monday, January 5th.

As tax season is fast approaching - annual receipts and statements will soon start to be distributed. As mentioned in our 2025 Summer Newsletter, CRA will randomly request documentation on common personal tax deductions. Below is a list of the most common post assessments Ward & Uptigrove saw this summer and what is the recommended documentation for each claim.

Child Care Deduction

• Monthly or annual statements from corporate day care providers
• Must include:
• Child’s first and last name
• Dates of childcare expenses, general comments such as “provided in 2025” or “month of January 2025” are acceptable
• Amount paid for services
• Must indicate a paid balance (show $0 owing, stamped paid or provide copies of cancelled cheques or transfers)
• Name of child’s parent(s)
• Name and address of provider
• Individuals providing day care services must provide all of the above as well as:
• Provider signature on receipt
• Social insurance number of the provider
• Individuals may be reluctant to provide their SIN, sending the receipt directly to Ward & Uptigrove through our ShareFile portal is always an option. 
  

Medical Expenses

• Receipts must include:
• Patient name
• Description of goods or services provided
• Indicate that the amount has been paid (show $0 owing, stamped paid or provide copies of cancelled cheques or transfers)
• Drug Identification number (DIN) if the amount is for prescription drugs
• Name of medical practitioner who prescribed / performed services
• Annual pharmacy statements are recommended as they contain all of the required information and do not require you to keep track of small prescription receipts throughout the year
• Annual insurance statements are preferred as they normally include all of the required information
• Medical travel must provide:
• Letter from family doctor or nurse practitioner that the services obtained were not available within a 40KM radius of the patient’s home
• Appointment dates, print-out of appointment dates from specialist office is normally the best to obtain
• Description of the reason for the trip, which can be provided by the taxpayer themselves
       

Foreign Taxes Paid (Not from Canadian T-Slip)

• Must have completed a foreign tax return and can provide the filed tax return and notice of assessment OR proof that a tax return was not required to be filed.
• If a notice of assessment is not available yet, proof of payment or receipt of expected refund is allowable as long as they show details such as who the payment was made to and which tax year it relates to.

Spousal or Child Support Payments

• A signed court order or written agreement
• Monthly or annual receipt which includes:
• Name of person making payment
• Name, address, date of birth and SIN of person receiving the payment
• Total amount paid, breakdown of what was child vs. spousal
• Names of the children support was paid for (if applicable)
• Dates payments were made
• Signature of recipient confirming receipt of payments
• Cancelled cheques can be provided if receipt is not able to be obtained. Note that e-transfers are generally not acceptable unless accompanied by a letter from the recipient confirming amounts received.

Property Tax or Rent Payments

• Valid rent receipts include:
• Amount of rent paid
• Date rent was paid, general comments such as “rent paid in 2025” are acceptable
• Name of individual who paid rent
• Address of the property rented
• Name of individual or business who received the rent
• Landlord’s signature
• Property taxes must be able to provide property tax statement from the municipality
• The statement must be stamped paid or provide a receipt of payments from the municipality
• If receipt of payment is not able to be obtained, you can provide cancelled cheques or bank statements showing the amounts paid to the municipality in its place.

Direct Deposit

As a reminder, CRA will no longer accept changes to direct deposit through e-filing a personal tax return. All changes must be done through MyAccount, a Canadian Bank or Credit Union, or a direct deposit enrollment form.

Electronic Mail

CRA is continually changing the method of communication for individuals. Individuals are now urged to register for a MyAccount   and update their notification preferences. Taxpayers should regularly check their online correspondence in their MyAccount to ensure that they do not miss out on important information such as notices of assessments/reassessments, installment reminders, post assessment letters, or statement of accounts.

CRA has defaulted MyBusiness accounts to electronic mail. Only those who had a business number prior to May 2025 and, do not have a registered MyBusiness account or do not have an Authorized Representative who has access to their CRA account will continue to receive physical mail. You can request to continue to receive paper mail by filling out an RC681 form, which must be resubmitted every two years. Should you choose to continue to receive physical mail, it will be imperative to keep your mailing address up to date as CRA will automatically revert a business to online mail if undeliverable mail is returned to them. If not done so already, it’s recommended that business owners register for a MyBusiness account and update their notification preferences. Ensure to regularly check your online correspondence in your MyBusiness account to ensure you do not miss out on important information such as notices of assessments/reassessments, installment reminders, audits, or statement of accounts.

Missing CRA correspondence for both businesses and individuals could lead to significant consequences, such as interest, penalties, or large, unexpected tax assessments. There are strict time frames the CRA provides for you to be able to provide information or object to an assessment – if these time frames lapse then you may be unable to object to the assessment. Click here for more information on CRA’s changes.

Please reach out to our Administrative team for assistance with filing the RC681, registering for a MyAccount/MyBusiness account, or updating your notification preferences.

Please note that representatives, such as Ward & Uptigrove, do not have the ability to update or maintain their client’s email information or mail notification preferences with CRA and therefore it remains the responsibility of the individual/business to ensure they have their accounts set-up accordingly to continue to receive CRA’s communications.

CRA will never send unsolicited emails or text messages asking you to click a link, provide personal information, or confirm banking details. If you receive a message that seems suspicious, please do not open any links and contact CRA directly.

Authorization

CRA changed their authorization process for individuals this past summer. To authorize a representative, you will now need to either:

1. Authorize a representative through MyAccount
2. Provide a representative with a Notice of Assessment from a previous year’s tax return and sign a certification page which is submitted to the CRA to be processed. CRA may still contact you to verify the authorization request under this method.

Ward & Uptigrove uses this authorization to download information from CRA for your personal tax returns to ensure accuracy of information as well as to correspond with CRA on your behalf for various reasons.

A reminder that CRA has also changed the way that authorization can be given for business numbers. Now a business registrant can only provide authorization through their MyBusiness account. Please note that when you register for a MyBusiness account for the purpose of authorizing a Representative, CRA will automatically update the default method of communication to electronic mail as noted above.

Those with MyAccount or MyBusiness Account can review Authorized Representatives on file and revoke access at any time. If you notice that Ward & Uptigrove is not authorized on your account and you would like them to be, reach out to our Administrative team for next steps.

Similar to personal tax returns, CRA issues a number of communications to corporations or sole proprietors registered for HST or payroll throughout the year.

Corporate Pre/Post Assessments

These are letters from CRA requesting back up documentation regarding specific sections of the corporate tax returns either prior to the assessment of the return and issuing of refunds (pre-assessment) or after the returns have been assessed and refunds have been issued (post-assessment).

Pre-assessments often occur in relation to input tax credits that generate a significant deduction or refund. This includes, the Ontario Regional Opportunities Investment Tax Credit or the Ontario Made Manufacturing Investment Tax Credit.

Post-assessments are often random and may relate to a project that CRA is running. Common post-assessments seen every year relate to vehicle additions, vehicle expenses, professional fees, foreign tax credits, travel expenses, and donations.

Payroll Discrepancy Notice (PD4R)

These are notices issued from CRA when there is a difference between total remittances made during the calendar year and the total amounts reported on T4/T4A slips. You are required to respond to these notices in order for CRA to verify if you are entitled to a credit on the account or if you owe more funds.

HST Review

CRA’s HST reviews can be random, but they often are a result of a large refund filed or a large increase in HST input tax credits claimed. These letters will often require some information about the business, a listing of sales, HST collected and HST ITC’s, a copy of the 10 largest sales invoices and expense invoices, as well as details on capital asset additions or disposals.  

HST Sales Discrepancy

These letters are a result of there being a discrepancy between the sales reported and the expected HST collected associated with that return. This could be due to zero-rated or exempt sales being reported on the wrong line, which would give CRA the impression that there might be missing HST collected when there isn’t.

Another reason for the discrepancy letters is there being a difference between the sales reported on your personal or corporate tax return as compared to the sales reported or HST collected on your HST returns.

These types of letters often ask for an explanation of the difference and provide the opportunity to the taxpayer to correct the return if needed.

HST Rebates

CRA provides new housing rebates to individuals building their own new house or to corporations who build new houses as part of their business. As these rebates are specialized and often complex, they are almost always reviewed or required to submit documentation as part of the process. What type of information is required to be submitted will depend on which type of rebate was filed for. This could range from building purchase documentation to individual construction expense receipts.

Most CRA letters have a 30-day response requirement. If no response is submitted or no extension is requested, they will assume the claim was invalid and reassess the return to deny the claim made.

These letters can be responded to by the taxpayers themselves, however; if you are unsure or would like assistance in responding, forward the correspondence to your Client Manager as soon as possible. Please note that these matters are a separate service from regular year-end preparation and will be invoiced accordingly. 

As CRA’s data analytics continually improve, they are starting to investigate not only variances but also inconsistencies between related accounts. Currently, CRA reviews can sometimes be anticipated, however; we may see an increase in the volume or types of reviews in the future. If you have a business with large variances between reporting periods, frequently purchase vehicles within your business, deal with new housing rebates often, or are part of a large group of related companies - considering signing up for Audit Shield.

Audit Shield provides a cost-effective protection against CRA audits, enquiries, investigations or reviews. One annual payment can cover Ward & Uptigrove’s fees up to a specified amount for responding to CRA audits for corporate tax filings, personal tax filings, GST/HST filings, employer compliance audits, and business audits. Please note that Audit Shield does not cover personal tax pre-assessments, please refer to our Summer Newsletter for more information on those types of communications.

Please reach out to the Client Manager on your account if you have any questions or to see if Audit Shield is a good fit for you.

If you travel to the US for more than 29 days at a time but less than 183 days, you may be required to file a closer connection return (Form 8840). This is an information only return which allows an individual who meets the United States substantial presence test, to still be treated as a nonresident for US tax purposes. This return must be filed annually by June 15^th. As the US increases their use of technology at the border, it may become easier for them to identify non-compliant individuals. Not filing this return could result in US tax being imposed and penalties being assessed. Please notify your Client Manager if this applies to you.

During the 2023 tax year, CRA requested that issuers (including employers and pension plan administrators) of T4 or T4A's needed to report on the slip whether on December 31st of that taxation year an employee or any of their family members were eligible to access dental insurance, or dental coverage of any kind including health spending and wellness accounts due to their current or former employment. If this was not reported in 2023 the CRA defaulted the reporting to code 1 which was "no access to any benefits".

This should have been reported on the following boxes:

• Box 45 on all T4 slips
• Box 015 on all T4A slips

For the current year and going forward, those boxes noted above on the T4 or T4A are MANDATORY. As such if those boxes have nothing in it when the slips are submitted, the CRA has indicated that they will reject the T4 and T4A submission requiring corrections which may result in penalties.

When filling out the T4 or T4A, employers must select one of the following 5 codes to report the situation that applies to their employees:

• Code 1 - No Access to any dental care insurance, or coverage of dental services of any kind
• Code 2 - Access to any dental care insurance or coverage of dental services of any kind for on the employee 
• Code 3 - Access to any dental care insurance or coverage of dental services of any kind for employee, spouse and dependents
• Code 4 - Access to any dental care insurance or coverage of dental services of any kind for only the employee and their spouse
• Code 5 - Access to any dental care insurance or coverage of dental services of any kind for only the employee and dependents

Note - If the employee has access to dental care insurance or coverage and has chosen to decline it for any reason the employer CAN NOT report Code 1.

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Congratulations to Rita Cole on her progression to a Partner position within the firm! We’re excited to celebrate Rita’s advancement and the continued growth of our team. 

As 2025 wraps up, Immigration, Refugees and Citizenship Canada (IRCC) has released its 2026–2028 Immigration Levels Plan. Below is an overview of the Plan’s key focus and what it means for small business employers.

Focus Areas

• Fewer temporary workers: Canada will significantly reduce new temporary resident admissions. The number of new temporary worker arrivals will decrease from 367,750 in 2025 to 230,000 in 2026.
• Steady permanent resident targets: Economic-class immigration, especially through Provincial Nominee Programs, will remain steady.
• More temporary workers transitioning to permanent residency: 33,000 temporary workers will be accelerated into permanent residency pathways in 2026 and 2027.

What This Means for Your Business

• Tighter access to short-term labour: Sectors that rely on seasonal or short-term foreign workers may face hiring challenges as temporary worker numbers decline.
• Greater need to plan ahead: LMIAs, recruitment, and onboarding may require longer lead times. Employers will need to plan their workforce further in advance.
• Stronger opportunities for talent retention: With a greater emphasis on permanent pathways, employers can support key workers in settling permanently, reducing turnover and training costs.

How Employers Can Prepare

• Review your workforce to identify roles dependent on temporary foreign workers.
• Explore temporary resident to permanent resident pathways to retain strong employees on a long-term basis.
• Extend hiring timelines to reflect reduced temporary foreign worker availability.
• Seek professional guidance to optimize immigration strategies and compliance.

Emerging Leaders Development Program