Tax filing reform to save businesses $1.2 million

New red-tape relief for Canadian companies has been announced, says Maxime Bernier, minister of state, and Andrew Saxton, parliamentary secretary to the president of the Treasury Board and for Western economic diversification.

Bernier unveiled proposed changes that will see 32,000 fewer corporations filing tax returns under the Corporations Returns Act. This move will save companies an estimated $1.2 million in administrative costs.

Due to these changes, only corporations with revenues of more than $200 million, assets over $600 million, or foreign debt and equity over $1 million will have to report financial and ownership information under the Act.

Read: Foreign equity funds strong in 2012

At the same time, the vast majority of total foreign-controlled assets (99%) and total foreign-controlled revenues (98%) will still be covered. The reform will come into force in the spring of this year.

These thresholds were last amended in 1981, when they were set at $15 million in operating revenues, $10 million in assets and $200,000 of foreign debt or equity. Under the old thresholds, many corporations are required to file ownership returns while not having any foreign ownership or control.

The proposed change falls under the action plan’s one-for-one rule, which requires that regulators help business owners by offsetting the administrative burden of every new regulation introduced.

Read: Dealing with indirect taxes

Canada will be the first country to give the weight of legislation to such a rule.

The vast majority of the overall reforms will be implemented in the next three years.

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