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2022 Federal Budget
Canadian Tax and
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Legislation Introduced Subsequent to
the Tabling of the Budget
9, 2022 News Release re draft legislation for consultation, which
includes measures from Budget 2022, as well as from the 2021 Economic Update and
Budget 2021. The proposals re Budget 2022 measures relate to:
for residents of Canada, at least 18 years of age, must not have lived
in a home that they owned, either:
at any time in the year the account is opened, or
during the preceding 4 calendar years.
ownership includes beneficial ownership, but excludes a right
to acquire less than 10% of a qualifying home.
contributions of up to $8,000 are deductible annually: unlike
RRSPs, only contributions made within the calendar year (not within the
first 60 days of the following calendar year) can be claimed as a
deduction for that calendar/tax year.
contributions made can be carried forward indefinitely and deducted
in a later tax year instead of being deducted in the year the
contribution is made.
unused annual contribution room cannot be carried forward: draft
legislation indicates that unused contribution room will be able to be
lifetime contribution limit of $40,000
withdrawals to purchase home are non-taxable
before the withdrawal, an agreement must be in place to
purchase or construct the qualifying home before October 1 of the
year following the date of the withdrawal
the individual cannot have acquired the qualifying home more
than 30 days before the withdrawal is made.
other withdrawals are taxable: to the holder of the FHSA, with no
attribution to a spouse or common-law partner who may have gifted the
funds for the FHSA contributions.
funds not used for a qualifying first home purchase within 15 years of
first opening an FHSA (by Dec 31 of the year in which the earlier of
these events occurs: the15th anniversary of the individual first opening
the FHSA, or the individual turning 71 years old) would have to be withdrawn (taxable) or
transferred tax-free to an RRSP or RRIF: these transfers would not be
reduced, or be limited by, an individual's RRSP contribution limit.
also cannot open an FHSA after Dec 31st of the year in which
the earliest of the above events occurs.
can transfer funds tax-free from RRSP to FHSA subject to the annual
and lifetime contribution limits: unless the RRSP is a spousal RRSP
to which spousal contributions have been made in the current year or 2
cannot make both an FHSA withdrawal and a Home Buyers' Plan withdrawal
in respect of the same qualifying home purchase
individuals should be able to open an FHSA and start contributing
sometime in 2023
following rules in place for the Mineral Exploration Tax Credit (METC)
METC provides a tax credit of 15% of specified mineral exploration
expenses incurred in Canada and renounced to flow-through share
new CMETC would provide a 30% tax credit for specified minerals used
in the production of batteries and permanent magnets, or in the
production and processing of advanced materials, clean technology, or
eligible expenditures would not benefit from both the proposed CMETC
and the METC
would apply to expenditures renounced under eligible flow-through
share agreements entered into after April 7, 2022 and on or before March
measures proposed to prevent taxpayers from "manipulating" the status
of their corporations to avoid qualifying as a CCPC to achieve a
tax-deferral advantage on investment income earned in their corporations
Substantive CCPCs earning and distributing investment income would be
subject to the same anti-deferral and integration mechanisms as CCPCs
with respect to such income.
would apply to taxation years that end on or after April 7, 2022
retailers may continue to sell until January 1, 2023 unstamped
products that are in inventory as of October 1, 2022
exclusions for vaping products already subject to the cannabis excise
duty framework and those produced by individuals for their personal use
duty-free importations of unstamped vaping products for personal use
for travellers returning to Canada, for an absence of 48 hours or more,
for up to 12 vaping products with a total volume being imported of up to
proposal to allow licensed cannabis producers to remit excise duties
on a quarterly rather than month basis, starting from the quarter that
began on April 1, 2022, for licensees required to remit less than a
total of $1M in excise duties during the four fiscal quarters
immediately preceding that fiscal quarter
proposals for other technical amendments; changes to penalties for
lost excise stamps; changes to licences
proposal to eliminate excise duty for beer containing no more than
0.5% alcohol by volume (ABV), bringing the tax treatment of such beer
into line with the treatment of wine and spirits with the same alcohol
proposal to amend the Nisga'a Final Agreement Act to provide force-of-law
to all provisions of the Nisga'a Nation Taxation Agreement
includes a forthcoming amendment with respect to an income tax exemption
for amounts received by citizens of the Nisga'a Nation from a registered
pension plan to the extent that the employment on which the pension amounts
are based was itself exempt from tax