Liberals introduced CELIAPP into the 2022 federal budget to help Canadians save for the initial payment of a first house. The contributions to the regime would be tax deductible, a bit like a REER, but the withdrawals would be tax -free, like a CELI. The lifetime contribution limit would be $ 40,000 and the annual contribution limit would be $ 8,000.
The new accounts are expected to be ready for 2023, according to the budget.
Josée Baillargeon, chief political adviser at IFIC, said the Institute had met with representatives of the Canadian Revenue Agency (ARC) and the Ministry of Finance to discuss the rules governing this new savings account. The IFIC also submitted to the Ministry of Finance, in collaboration with other organizations in the financial sector, an 11 -page document containing questions on the new regime.
Robert Offen reports that the sector is waiting for the Ministry of Finance to publish a bill seeking to implement CELIAPP by the end of July, followed by a 60 -day comment period. Other legislation will likely follow in October, and final legislation is expected to be adopted in mid-December.
“If we were to publish this text at the beginning of 2023, we should probably start [les opérations de construction] before we know what we are building, what can pose some problems, ”laments Robert Offen.
Before it can go any further, the industry wants to get more advice on CELIAPP in four key areas:
- customer reception requirements;
- the tax rules, including the declarations and forms required;
- the rules governing family ties, including the existence of a CELIAPP for the couple; et
- the rules governing the appointment of beneficiaries and successions.
Robert Offen notes that the industry is waiting for other consultations with the ARC to take place during the second semester of the year.
“There are many more unknowns than valid elements at this stage,” recalls Josée Baillargeon.
She added that officials from the ARC and the Ministry of Finance have nevertheless been proactive in helping the industry prepare for the launch of CELIAPP. “It will be a constantly evolving process.”
During the same session, Benjamin Latta, manager of the financial institution compliance section at the CRS and the FATCA of the Canadian Revenue Agency, said that the verifications are in place. Foreign Account Tax Compliance Act and the Common Standard of Declaration of Financial Institutions will resume at “the end of 2022 or the beginning of 2023”.
Benjamin Latta also adds that the ARC has no intention of imposing penalties “at this stage” before carrying out a verification – which gives the financial institution the opportunity to prove its compliance. The fact of being selected for an audit is not necessarily a sign of non-compliance, he is sure, since the ARC aims to audit a diverse and representative body of institutions.
– With the collaboration of Melissa Shin