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Budget 2019 – Poor wording requires 2 ex-spouses within 5 years for Home Buyers Plan

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This is one of those rare times I hope I am wrong in my interpretation, and look forward to being proven wrong by my professional colleagues.

On March 19, 2019 the federal government tabled its election-year budget. One of the newest and strangest provisions is the ability for people going through a separation or divorce to potentially have access to their RRSP under the Home Buyers Plan.

Now in my article and podcast entitled: “Escape Room – The NEW Small Business Tax Game – Family Edition” with respect to the Tax On Split Income (TOSI) rules, I made a tongue in cheek argument that people will be better off if they split, because then the TOSI rules won’t apply.

In keeping with the divorce theme, beginning in the year of hindsight, 2020, the federal government is giving you an incentive to split up and get your own place.

However, there are a few hoops:

On page 402 of the budget, under new paragraph 146.01(2.1)(a), at the time of your RRSP withdrawal under the Home Buyers Plan, you must make sure that:

  • – the home you are buying is not the current home you are living in and you are disposing of the interest in the current home within two years; or
  • – you are buying out your former spouse in your current home; and

you need to:

  • be living separate and apart from your spouse or common-law partner;
  • have been living separate and apart for a period of at least 90 days (markdown October 3, 2019 on the calendar),
  • began living separate and apart from your spouse or common-law partner, this year, or any time in the previous 4 years (ok, you don’t have to wait for October); and…

…here is where the tabled proposed legislation gets messy.

Proposed subparagraph 146.01(2.1)(a)(ii) refers to where the individual

  • wouldn’t be entitled to the home buyers plan because of living with a previous spouse in the past 4 years that isn’t the current spouse they are separating from

“(ii) in the absence of this subsection, the individual would not have a regular eligible amount because of the application of paragraph (f) of that definition in respect of a spouse or common-law partner other than the spouse referred to in clauses (i)(A) to (C), and…”

The problem with the wording of this provision, is that it is written in the affirmative by the legislators using the word “and”. This means, you must be able to answer “true” to all the tests for the entire paragraph to apply.

The way I read this, the only way to answer “true” to this subparagraph is if you have a second spouse (ie: spouse other than the spouse referred to) that you shared a home with and you split from in the past four years.

If you have a second spouse that you shared a home with in the past four years, then “paragraph (f)” in the definition of “regular eligible amount” would apply and the answer would be “true”.

If the answer is “true” you can then get access to your RRSP Home Buyers Plan.

If you don’t have a second spouse then, even though “paragraph (f)” might be met, the phrase “spouse other than the spouse referred to” would not be met, and therefore the answer would be “false”.

This would, in turn, cause the entire logic test of the provision to be “false” and so you would not be able to take out a “regular eligible amount” from your RRSP for the Home Buyers plan because you do not meet the provisions.

If my interpretation is correct then I would really be curious as to what part of the economy they are trying to stimulate.

In my opinion the legislation could be fixed with a simple edit:

“(ii) in the absence of this subsection, the individual would not have a regular eligible amount because of the application of paragraph (f) of that definition in respect of:

(A) a spouse or common-law partner; or

(B) a spouse or common-law partner other than the spouse referred to in clauses (i)(A) to (C); and…”


Cory G. Litzenberger, CPA, CMA, CFP, C.Mgr is the President & Founder of CGL Strategic Business & Tax Advisors; you can find out more about Cory’s biography at http://www.CGLtax.ca/Litzenberger-Cory.html

CEO | Director CGL Tax Professional Corporation With the Income Tax Act always by his side on his smart-phone, Cory has taken tax-nerd to a whole other level. His background in strategic planning, tax-efficient corporate reorganizations, business management, and financial planning bring a well-rounded approach to assist private corporations and their owners increase their wealth through the strategies that work best for them. An entrepreneur himself, Cory started CGL with the idea that he wanted to help clients adapt to the ever-changing tax and economic environment and increase their wealth through optimizing the use of tax legislation coupled with strategic business planning and financial analysis. His relaxed blue-collar approach in a traditionally white-collar industry can raise a few eyebrows, but in his own words: “People don’t pay me for my looks. My modeling career ended at birth.” More info: https://CGLtax.ca/Litzenberger-Cory.html

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Business

Canada’s climate agenda hit business hard but barely cut emissions

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This article supplied by Troy Media.

Troy Media By Gwyn Morgan

Canada is paying a steep economic price for climate policies that have delivered little real environmental progress

In 2015, the newly elected Trudeau government signed the Paris Agreement. The following year saw the imposition of the Pan-Canadian Framework on Clean Growth and Climate Change, which included more than 50 measures aimed at “reducing carbon emissions and fostering clean technology solutions.” Key among them was economy-wide carbon “pricing,” Liberal-speak for taxes.

Other measures followed, culminating last December in the 2030 Emissions Reduction Plan, targeting emissions of 40 per cent below 2005 levels by 2030 and net-zero emissions by 2050. It included $9.1 billion for retrofitting structures, subsidizing zero-emission vehicles, building charging stations and subsidizing solar panels and windmills. It also mandated the phaseout of coal-fired power generation and proposed stringent emission standards for vehicles and buildings.

Other “green initiatives” included the “on-farm climate action fund,” a nationwide reforestation initiative to plant two billion trees, the “Green and Inclusive Community Buildings Program” to promote net-zero standards in new construction, and a “Green Municipal Fund” to support municipal decarbonization. That’s a staggering list of nation-impoverishing subsidies, taxes and restrictions.

Those climate measures come at a real cost to the industry that drives the nation’s economy.

The Trudeau government cancelled the Northern Gateway oil pipeline to the northwest coast, which had been approved by the Harper government, costing sponsors hundreds of millions of dollars in preconstruction expenditures. The political and regulatory morass the Liberals created eventually led to the cancellation of all but one of the 12 LNG export proposals.

Have all those taxes and regulatory measures reduced Canada’s fossil-fuel consumption? No. As Bjorn Lomborg has reported, between the election of the Trudeau government in 2015 through 2023, fossil fuels’ share of Canada’s energy supply increased from 75 to 77 per cent.

That dismal result wasn’t for lack of trying. The Fraser Institute has found that Ottawa and the four biggest provinces have either spent or forgone a mind-numbing $158 billion to create just 68,000 “clean” jobs, increasing the “green economy” by a minuscule 0.3 percentage points to 3.6 per cent of GDP at an eye-watering cost of more than $2.3 million per job.

That’s Canada’s emissions reduction debacle. What’s the global picture? A decade after Paris, 80 per cent of the world’s energy still comes from fossil fuels. World energy demand is up 150 per cent. Canada, which produces roughly 1.5 per cent of global emissions, cannot influence that trajectory. And, as Lomborg writes: “achieving net zero emissions by 2050 would require the removal of the equivalent of the combined emissions of China and the United States in each of the next five years. This puts us in the realm of science fiction.”

Does this mean our planet will become unlivable? A U.S. Department of Energy report issued in July is grounds for optimism. It finds that “claims of increased frequency or intensity of hurricanes, tornadoes, floods and droughts are not supported by U.S. historical data.” And it goes on: “CO2-induced warming appears to be less damaging economically than commonly believed and aggressive mitigation policies could be more detrimental than beneficial.”

U.S. Secretary of Energy Chris Wright responded to the report by saying: “Climate change is real … but it is not the greatest threat facing humanity … (I)mproving the human condition depends on access to reliable, affordable energy.”

That leaves no doubt as to where our largest trading partner stands on carbon emissions. But don’t expect Prime Minister Mark Carney, who helped launch the Glasgow Financial Alliance for Net Zero (GFANZ) at COP 26 in that city in 2021 and co-chaired it until this January, to soften his stand on carbon taxes. His just-released budget imposes carbon tax increases of $80 to $170 per ton by 2030 on our already struggling industries.

Doing so increases Canadian businesses’ competitive disadvantage with our most important trading partner while doing essentially nothing to help the environment.

Gwyn Morgan is a retired business leader who has been a director of five global corporations.

Troy Media empowers Canadian community news outlets by providing independent, insightful analysis and commentary. Our mission is to support local media in helping Canadians stay informed and engaged by delivering reliable content that strengthens community connections and deepens understanding across the country.

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Censorship Industrial Complex

Conservative MP Leslyn Lewis slams Liberal plan targeting religious exemption in hate speech bil

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From LifeSiteNews

By Anthony Murdoch

Bill C-9 is being called an attempt to criminalize sections of the Bible, Quran, Torah, and other sacred texts in Canada.

Canadian Conservative MP Leslyn Lewis blasted a federal government plan to criminalize parts of the Bible as an attack on “Christians,” warning it sets a “dangerous precedent” for Canadian society.

“The Liberal government has agreed to remove the religious exemption in their hate speech bill, C-9, to secure Bloc support and push this bill through Parliament,” Lewis wrote Tuesday on X.

“This is not a minor adjustment. This shift comes at the direct expense of Christians and other religious communities across Canada.”

As reported by LifeSiteNews, a government insider revealed that the Liberal government of Prime Minister Mark Carney plans to remove religious exemptions from Canada’s hate-speech laws by modifying a bill.

Bill C-9, the Combating Hate Act, as reported by LifeSiteNews, has been blasted by constitutional experts as allowing empowered police and the government to go after those it deems have violated a person’s “feelings” in a “hateful” way.

A recent media report states that the Carney Liberals and the separatist Bloc Québécois want to amend Bill C-9, which would “criminalize sections of the Bible, Quran, Torah, and other sacred texts,” Conservative leader Pierre Poilievre noted yesterday on X.

Lewis warned that “no government” should “ever negotiate away religious liberty in exchange for political support.”

“No party should decide which beliefs are acceptable and which ones carry criminal risk,” she warned.

She added that the Liberal government of Carney’s plan to amend Bill C-9 is a “dangerous precedent.”

Poilievre blasted the Liberals’ plan as well, warning Liberal-Bloc amendments to C-9 will “criminalize sections of the Bible, Quran, Torah, and other sacred texts.”

“Conservatives will oppose this latest Liberal assault on freedom of expression and religion,” he noted on X earlier this week.

In response, the party launched a petition over fear that religious texts could be criminalized.

Liberal MP Marc Miller had said earlier in the year that certain passages of the Bible are “hateful” because of what it says about homosexuality and those who recite the passages should be jailed. As reported by LifeSiteNews, he was recently appointed as a government minister by Prime Minister Mark Carney.

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