Mar 28, 2017
The Liberal government’s second federal budget, released on March 22, 2017, contains provisions that will change the way certain lawyers compute their income for tax purposes, explains senior editor and lawyer Tim Wilbur in a recent article on Legal Feeds, the blog of Canadian Lawyer and Law Times. Taxpayers in certain professions – including lawyers – will no longer have the ability to use billed-basis accounting through which they can currently defer recognition of income while still deducting the related expenses in the year they are incurred. In the article, Osler partner and tax expert, Gregory Wylie, comments on this and other changes contained in the budget.
“The budget is best described as fairly light on tax measures. There are no major policy announcements or changes,” he explains. “The government continues to modestly pursue its agenda announced in the 2016 budget to focus on perceived fairness issues, including closing so-called loopholes, and targeting perceived inefficient or ineffective tax measures. In this regard, it is notable that Budget 2017 announces the government will in the next few months release a paper on tax planning using private corporations to reduce personal taxes. We may see future changes announced with the pending October 2017 federal government economic statement.”
For more information about the other changes to the tax system announced in the budget, read Tim Wilbur’s full article, “Federal budget will affect how lawyers recognize income” in Legal Feeds.