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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”

Local Business

Red Deer’s Newest Hotel perfect for extended stays!

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When Red Deer based ZH Holdings decided to expand, they opted for a different look and feel from their portfolio of Holiday Inn properties.  The company that oversees the Holiday Inn brand had another ZS Holdings thought would make a perfect fit for Red Deer.  It’s called Staybridge Suites.

At Staybridge Suites, the rooms are perfect for people staying several nights.  All rooms have fully equipped kitchens, so you can prepare your own meals with a stove, microwave, refrigerator, and dishwasher.  The suites all have large workspaces with complimentary high-speed internet, and a 24-hour business centre to help you stay at your best.  On top of that, each suite is designed with a separate seating area so it feels just a little bit more like home.  Staybridge also offers apartment-style suites with separate sleeping and living rooms, ideal for families and groups.

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Staybridge Suites is absolutely loaded with amenities, like storage lockers, free laundry facilities, a 24-hour fitness centre, and a 24-hour convenience store loaded with easy-to-prepare meals, snacks, and anything you may have left at home.  Of course at home you probably don’t have an indoor pool, hot tub and waterslide.  You probably also don’t have a full breakfast buffet every morning.  Staybridge does.  Red Deer’s new Staybridge Suites is more than just a hotel—it’s somewhere you can feel at home.

It’s also brand new.  Please take a minute to watch some highlights of our recent grand opening ceremony, featuring Alberta Premier Jason Kenney!

And enjoy this fun little video which really captures the spirit of Staybridge.

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Alberta

Homes by 3Leafs showcases the first single family, shipping container home built in Calgary.

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Homes by 3Leafs showcases the first single family, shipping container home built in Calgary. The Alberta based company is changing how homes are constructed by transforming recycled steel containers into high performance, energy efficient homes with net zero capabilities.

September 19, 2019, Calgary, AB ​Homes by 3Leafs gave media an exclusive inside look into the sleek, elegant modern two-storey home made from four recycled shipping containers. The home is nestled in the eco-friendly community, Echohaven, in northwest Calgary.

Som Sourachit, C.E.O. of Homes by 3Leafs describes this moment as pivotal. “Our high performance, energy efficient houses reduce waste in landfills by repurposing steel shipping containers into dream homes. The houses have net zero capabilities and are the new blueprint for how we should build while protecting our environment. “

It’s estimated there are millions of shipping containers piling up in landfills worldwide. The repurposed containers make the perfect envelope for a home, and reduce the heavy reliance on trees used for construction. The steel means shipping container homes are sturdier and will last for generations with fewer repairs than traditional stick builds over time.

The homeowner, Jaime Turner, added “This is a teaching moment for my young daughter. We wanted to build a legacy for her. This is our forever home and we know because it’s made of steel it will last for generations, and an added bonus is, we are being good to our environment!”

Homes by 3Leafs is proud to be leading the way in new home construction. Currently, 6 building projects are underway.

About Homes by 3Leafs

Homes by 3Leafs is a global company based in Edmonton and is comprised of a team of architects, construction experts, designers, and engineers with years of experience developing stunning homes. By using shipping containers to build, Homes by 3Leafs is committed to saving the environment. Thousands of containers pile up in landfills unused while forests can’t be cut down fast enough to support the robust construction industry. The company leads the way with cutting edge technology and new innovations to help the world build beautiful sustainable homes to last hundreds of years.

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october, 2019

wed16oct6:00 pm11:00 pmBusiness of the Year Awards - Red Deer Chamber of Commerce6:00 pm - 11:00 pm Red Deer College

thu17oct6:30 pm8:30 pmACRYLIC POUR ART CLASSES6:30 pm - 8:30 pm

fri18oct7:00 pmLip Sync Battle7:00 pm MT Bo's Bar & Grill, 2310 50 Ave Event Organized By: The Outreach Centre

sat19oct9:00 am4:00 pmCoats 4 Kids & Charity Checkstop9:00 am - 4:00 pm Taylor Drive Event Organized By: The Central Alberta Crime Prevention Page

sat19oct10:00 am12:00 pmRed Deer River Naturalists Bird Focus Group Walk10:00 am - 12:00 pm MST Kerry Wood Nature Centre, 6300 45 Ave Event Organized By: Red Deer River Naturalists

sat26oct10:00 am12:00 pmRed Deer River Naturalists Bird Focus Group Walk10:00 am - 12:00 pm MST Maskepetoon Park Event Organized By: Red Deer River Naturalists

tue29oct(oct 29)1:00 amsun03nov(nov 3)1:00 amCanadian Finals Rodeo1:00 am - (november 3) 1:00 am Westerner Park, 4847A-19 Street

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