While economic optimism continues to improve in the country among business owners a supportive business climate coupled with the ease to do business is important to sustain that momentum and move the economy forward. The government’s announcement of $500 million in government largesse for venture capital, $1.1 billion in directed research and development funding, and $205 million for a one-year extension of a temporary hiring credit for small businesses -- these measures as well as others will help private businesses drive innovation and grow thriving enterprises by delivering products and services that create value both domestically and in export markets.
Canada’s vibrant SME sector is responsible not only for a significant contribution to GDP; it is also responsible for a large proportion of the country’s innovation. We encourage the federal government to support continued growth of Canada’s small and medium-sized businesses. Therefore, providing any opportunity for entrepreneurs to bring creative new products and services to the market in Canada and abroad while spurring continued job creation will benefit the long term prosperity for everyone.
A special edition of TaxNewsFlash-Canada summarizing the announced tax changes is now available.
For highlights of tax measures in the budget, see this edition of TaxNewsFlash-Canada.
Budget measures of particular interest to private companies are:
- An overhaul of the SR&ED program which includes more direct funding via grants for innovation rather than tax credits
- Venture capital funding – The government will provide $400 million for venture capital activities for private sector investments
- Eligible Dividends - Allowing companies to make split-dividend and late designations to capitalize on the payment of tax-effective dividends
- Simplification of GST/HST compliance for small business including the doubling of existing streamlined accounting thresholds
- Extension of the Hiring Tax Credit for 2012
- Old Age Security – Increasing the eligibility age to 67
- Measures tightening the rules regarding Retirement Compensation Arrangements, Employee Profit Sharing Plans, and Employer group health plans.
We can help
KPMG Enterprise™ advisers understand what private company business owners and entrepreneurs face every day. We can help you capitalize on the new measures announced by the federal government that support business growth. We can also help you assess the effect of the tax changes in this year’s federal budget on your personal finances or business affairs, and point out ways to take advantage of their benefits or ease their impact.