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Local Business

NO SOUP FOR YOU! Employees earning commissions need to go on a diet, implies CRA

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“NO SOUP FOR YOU” appears to be the message of the day from the Canada Revenue Agency (CRA) regarding business luncheons involving employees earning commission.

This is a case of “don’t shoot the messenger”, I am only here to inform you, so please, holster your weapon.

Consider the following scenarios:

1) A corporation that takes out a client for lunch and has a salesperson attend and reimburses the cost will be able to deduct the expense of the meal, subject to a 50% cap on the expense and will not create a taxable benefit to the employee. (See: Guide T4130)

2) A self-employed individual or partnership has the same benefit as in the first point.

3) A self-employed commissioned agent, like insurance, or real estate, also has the same benefit.

4) A transport employee that doesn’t receive an allowance, also has the same benefit of the above (subject to additional calculations and restrictions)

5) A corporation provides a $17 meal allowance for an employee that is travelling away from the office, but still inside the metropolitan area, where the corporation is the primary beneficiary of the allowance, and the allowance is not an additional form of remuneration – receives the same treatment, and is non-taxable to the employee.

But heaven forbid if you are a sales employee on commission, working in town, claiming your own expenses. If so, you only get to claim the meals that your client consumed up to the 50% cap and there is ‘no soup for you.’

At the October 5, 2018 Association de planification fiscal et financière (APFF) [Tax and Financial Planning Association] Annual Congress in Gatineau, Quebec, the CRA pointed out that the 50% cap on meals expenses in Subsection 67.1(1) applies to the meal expense incurred, however Subsection 8(4) denies any deduction for the commissioned employee’s portion of those meals.

Thus, if the commissioned employee takes one individual client out for lunch, and they eat the same thing, the commissioned employee only gets 25% of the meal receipt as a deduction.

So from now on, Edmonton based commission employees will need to eat in Calgary and stay the night, and Calgary-based commission employees will need to eat in Edmonton and stay the night, because according to the the Department of Finance, and CRA’s interpretation, that makes good business, and tax, sense.

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


The CRA’s unofficial translated preliminary comment is below:

“Paragraph 8(1)(f) provides that a taxpayer who was employed in the year in connection with the selling of property or negotiating of contracts for the taxpayer’s employer, may deduct in computing the taxpayer’s income amounts expended by the taxpayer in the year for the purpose of earning income from the employment subject to certain conditions provided for in that paragraph.

Furthermore, subsection 8(4) provides, in particular, that amounts expended by an employee on a meal of the employee may not be deducted under paragraph 8(1)(f) unless the meal was consumed during a period while the taxpayer was required by the taxpayer’s duties to be away, for a period of not less than 12 hours, from the municipality where the employer’s establishment to which the taxpayer ordinarily reported for work was located and away from the metropolitan area, if there is one, where it was located.

There is nothing in the Income Tax Act that allows the CRA to not apply subsection 8(4) where an employee’s meal was not consumed during a period while the taxpayer was required by the taxpayer’s duties to be away, for a period of not less than 12 hours, from the municipality where the employer’s establishment to which the taxpayer ordinarily reported for work was located and away from the metropolitan area, if there is one, where it was located”

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food and dining

One Eleven Grill shows off new renovations and some new menu creations

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One of Red Deer’s favourite restaurants has put some major effort into updating their space and creating some new menu items. One Eleven Grill opened its doors in 2011 with as a fresh and innovative entry into the local dining scene.

They’ve recently completed renovations and spent considerable time and effort developing some tasty new menu items. Watch the video above to get an idea of what you’re in store for next time you head down to one of the city’s finest restaurants.

About One Eleven Grill: An inviting and stylish restaurant tucked into the heart of Red Deer just waiting for you to discover or rediscover.

Opened on the first day of November in 2011, One Eleven has been thoughtfully and skillfully preparing delicious food and drinks for Central Alberta for years.

Our passion is STEAK! We are committed to quality, serving only the very best locally-owned, grass fed Alberta Triple AAA Beef in both classic and unique cuts.

Our warm, inviting ambiance is the perfect backdrop for everything from a romantic evening, a gathering with friends and family and even a quiet business lunch during the week. We even feature live jazz every Friday and Saturday. Add in one of the best selections of wine in the region, and One Eleven will set the perfect tone for your weekend.

At One Eleven we’re committed to your total satisfaction and we celebrate the people and food of Red Deer and Central Alberta every day.

For amazing food, great music and good times with family and friends, keep One Eleven in mind.

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Business News

Scott Subaru: Canada’s most environmentally friendly car dealership has opened in Red Deer

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You should visit Scott Subaru Passive House even if you’re not in the market for a new ride

From Scott Subaru: IT’S HAPPENED! 

We have moved into our new eco-friendly / energy efficient Passive House dealership and man are we happy! Although we are still in our ‘settling in’ process, we welcome you to come on down, have a nice hot beverage, and see just how big and beautiful this place is. We will be setting up a date for the Grand Opening once we have all our eggs in a cozy basket, so stay tuned for more information on that soon!
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The Scott Subaru Passive House is inspired by our partner, Subaru of Indiana, the automotive manufacturer that has achieved zero landfill status! Using an already positioned building, we strategically dismantled it piece by piece and saved everything we could for reuse and donation. For example, furniture donated, wires and cables salvaged to be recycled, and windows saved for re-use else where. This is an incredibly energy efficient dealership that is estimated to cost less than $200/year to heat and cool!

Outside we have permeable pavement for the landscaping. This eco-friendly, sustainable pavement helps reduce storm water run off, protecting it from solids and pollutants that travel to drainage facilities, and naturally filters the storm water turning it to ground water. Engineered to keep the building pristine while minimizing our energy use and environmental impact. ??♻️
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Massive thanks to everyone who was involved in this project! Black Creek Developments Inc., Sublime Design Studio Inc., Peel Passive House, 908 Engineering, Lex 3 Engineering, Sable Electrical Services, Cover Architecture, Heron’s Nest Landscaping, and many more…!!
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Our new location address is 6863 50 Avenue, Red Deer AB. 

Learn more about Passive House here… 
https://www.scottsubaru.com/passive-house

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july, 2019

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sun21jul11:00 am2:00 pmOne Eleven Jazzy Brunch11:00 am - 2:00 pm

fri26jul6:00 pm9:00 pmTaste of Red DeerSummer Just Got More Delicious!6:00 pm - 9:00 pm

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