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Archives for October 2023

Chartered Professional Accountant in Calgary,

Navigating the Principal Residence Exemption with Chartered Professional Accountants in Calgary

Did you know? In 2020, 70% of homes sold in Canada were eligible for the Principal Residence Exemption, saving homeowners an estimated $3.1 billion in taxes. On the other hand, 2.5 million Canadian taxpayers were in awe, indicating the widespread utilization of PRE.

Now, as Chartered Professional Accountants in Calgary, we understand the importance of maximizing tax savings for our clients. One powerful tool in our arsenal is the Principal Residence Exemption (PRE), a significant tax benefit available to homeowners in Canada.

In this blog post, we’ll provide you with a comprehensive guide on how to make the most of the PRE and ensure you’re well-equipped to navigate the complexities of claiming this exemption.

Chartered Professional Accountant in Calgary,

Chartered Professional Accountant in Calgary,

Understanding the Principal Residence Exemption (PRE)

The PRE is a tax benefit the Canadian government provides to individuals who sell their primary residence. This exemption allows homeowners to exclude the capital gain realized from the sale of their primary living from their taxable income, effectively reducing their overall tax liability.As CPAs, we aim to help you leverage this exemption. In fact, in the past years, the average tax savings achieved through the PRE in Calgary was approximately $15,000 per qualifying homeowner. Isn’t that amazing?

Eligibility Criteria

To qualify for the PRE, there are several critical criteria you need to meet:

  1. Ownership: You or your spouse must own the property.
  2. Usage: The property must have been used as your primary residence during the years you’re claiming the exemption. Property primarily used to generate income is considered inventory, and does not meet the requirements for PRE.
  3. Location: The property doesn’t have to be in Canada, it could be outside of Canada, such as a US vacation home.
  4. Designation: Only one property per year can be designated as a principal residence, per family (includes spouse or common law and children under 18 years).

Benefits of the PRE

As one of the leading Chartered Accountant Professionals in Calgary, we often find that our clients underestimate the potential benefits of the PRE. By properly utilizing this exemption, you can:

  1. Significantly Reduce Taxes:

The capital gain from selling your principal residence is tax-free, leading to substantial tax savings.

  1. Preserve Wealth:

Retaining your hard-earned money allows you to invest it back into your financial goals, whether retirement, education, or other investments.

  1. Estate Planning:

Utilizing the PRE effectively can also benefit your heirs by preserving the property’s value without burdening them with unnecessary taxes.

Chartered Professional Accountant in Calgary,

Chartered Professional Accountant in Calgary,

Navigating Complexities

Recent studies have shown that proper utilization of the PRE can accelerate retirement savings by up to 15% due to reduced tax liabilities. Additionally, homeowners aged 65 and older benefited significantly from the Principal Residence Exemption, with approximately 80% of them using the exemption to reduce their taxable capital gains.

While the PRE is a valuable tax-saving opportunity, it does come with complexities that require careful attention. Here’s where our expertise as Chartered Professional Accountants in Calgary comes into play:

  1. Change in Use:

There are tax implications if you transform your primary residence into a rental property or change its use. We can help you navigate the rules and minimize potential tax exposure.

  1. Reporting the Sale:

Even if your entire gain is exempt, you must report the sale on schedule 3 of your tax return. Our role as CPAs is to ensure accurate reporting, avoiding future issues with the Canada Revenue Agency (CRA).

  1. Plus One Rule:

Understanding the “plus one” rule can provide you with an extra year of exemption if you’re not utilizing the property as your primary residence just before the sale.

  1. Restriction on land size:

Property in excess of ½ hectare will generally not qualify under PRE, unless, excess land is required for the use and the enjoyment of the property.

Working with Your CPA

To make the most of the PRE, it’s crucial to work closely with your CPA. As well-known Chartered Professional Accountants in Calgary, here’s how we can assist you:

  1. Accurate Documentation:

We’ll guide you in maintaining meticulous records related to the property, ensuring you have the necessary evidence in case of a CRA audit.

  1. Form T2091(IND):

Our expertise will help you complete Form T2091 (IND), which designates your property as a principal residence for tax purposes.

  1. Foreign Property Reporting:

If you own foreign property, we’ll ensure you correctly report it on Form T1135, keeping you compliant with CRA regulations.

As your trusted Chartered Professional Accountant in Calgary, we’re here to help you maximize the Principal Residence Exemption. By understanding the eligibility criteria, leveraging the benefits, and navigating the complexities with our expert guidance, you can secure substantial tax savings and enhance your overall financial well-being. Don’t miss out on this valuable opportunity – let’s work together to maximize your tax efficiency and achieve your financial goals. Contact us today to get started on your journey toward a successful claim of the Principal Residence Exemption.



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Best CPA in Calgary

How Much You Pay For an Accountant in Calgary

Are you considering bringing an accountant in Calgary on board to manage your finances? Good decision, buddy!

However, how much should you pay to hire an expert accountant in Calgary? The price tag is a burning question, and the cost of hiring an accountant will depend on several factors.

Are you interested? So, let’s delve into the world of accountant fees!

You Pay For What You Get!

The responsibilities of a seasoned accountant are decisive factors when analyzing the cost. You can hire an accountant in Calgary to tackle personal or business accounting. Depending on this, their responsibilities and workload will vary. What are the services you wish to receive from an accountant? Do you have the budget to hire 5-star accounting services?

Free photo smiling ambitious accountants sitting at table with papers and calculator

Employing an expert to handle tax preparation or multiple processes will also influence the cost. For how long will you hire him? Is he a freelancer or works with a firm? What are his credentials and certifications? What are your financial needs? His work experience, the firm’s reputation, clientele, and projects he worked on will be considered.

“The more credibility the accountant in Calgary has, the higher you pay for genuine services.”

Hourly, Project Basis & Monthly

The payment structure based on an hourly rate is quite widespread and hinges on the experience of an accountant in Calgary and your specific requirements. Regarding hourly fees, the spectrum can be vast, stretching from rates of C$100 to soaring heights exceeding $400.

Free photo portrait of a young businessman holding pen over the graph and eyeglasses in hand looking to camera

When you find yourself in need of an accountant in Calgary for sporadic tasks like tax prep or audits, you have the option to bring them on board on a per-project basis. Does your business demand consistent accounting support? Outsourcing an accountant in Calgary every month is an option.

 “The decision will depend on how frequently you need his support and your budget.”

The Reputation of the Accounting Firm

The accounting firm’s reputation is also a decisive factor when conceptualizing the fees of an expert accountant in Calgary. Think about the time and effort you save from handling crucial tasks for the professionals; think about the money you save bypassing costly mistakes; think about the on-time guidance to facilitate your business process; think about the peace of mind you have – always believe in the long run.

“Are you hiring an accountant or a team of accountants? The fees go up with a team.”

The Best Accountant in Calgary

A professional accountant in Calgary is a trained financial expert with expertise in accounting, auditing, tax preparation, bookkeeping, financial analysis and advice, cash flow management, and much more. If you are considering outsourcing the services of a certified accountant in Calgary, look no further than AM Accountants Professional Corporation, your solution to proper accounting! Get a free quote now.



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Chartered Professional Accountant in Calgary

Chartered Professional Accountant Calgary | A Trusted Partner

AM Accountants Professional Corporation, an accounting company located in Calgary, has been helping businesses grow for over 20 years through reliable and rigorous accounting services. Services provided by our Chartered Professional Accountant in Calgary are second to none.

Free photo co-workers smiling

Indeed, you face these types of concerns –

  • When do I have to pay my taxes, and how much?
  • How much will I pay my employees this month?
  • What charges will I incur with this payment?
  • What is the current situation of my company?
  • How can I pay fewer taxes?
  • Is it now appropriate to make the investment that I had already planned?
  • How can I always have up-to-date information about my company?
  • And much more.

Just imagine managing your company more efficiently and with less worry. You invest your time, money, and efforts strategically by hiring a chartered professional accountant in Calgary.

Responsibilities of a chartered professional accountant

A chartered professional accountant has many responsibilities, including financial management, compliance, cash flow management, and strategic advisory roles. Here are some key responsibilities:

  • Prepare and analyze financial statements
  • Assist in minimizing tax liabilities
  • Complying with tax laws and regulations
  • Conduct and verify vital financial audits
  • Analyze financial data to provide insights
  • Develop budgets and financial forecasts.
  • Plan for the future and allocate resources
  • Identify and assess potential financial risks
  • Provide strategic financial advice to help you
  • Assist in the preparation of internal financial reports
  • Ensure that businesses adhere to relevant regulations
  • Uphold ethical standards and professional conduct
  • Stay updated on changes in accounting standards
  • Work with other professionals in the field
  • Maintain the confidentiality of financial data.

Plan your taxes with a CPA.

Do you want to plan your taxes calmly? Planning is a crucial aspect of good management practices, and an expert chartered professional accountant in Calgary will do it for you. We at AM Accountants request the delivery of accounting documentation promptly so that accounting processing occurs within the expected deadlines.

Free photo financial managers at work

Our chartered professional accountant in Calgary also monitors and helps you with tax savings so you can make the best decisions. However, you can avail of our tax consultancy services if you need technical studies on various tax matters.

Why have our customers been with us for over 20 years?

Our approach to Accounting is different. Our chartered professional accountant in Calgary knows what you need. If management reports are regularly delivered, you have sufficient performance indicators to make decisions. Our clients feel supported and have serious help keeping their business decisions.

Rest assured, all your accounting needs are well handled at AM Accountants Professional Corp.

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