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Essential Program Information

Taxation Years Covered

Corporate Taxprep 2020 v.2.1 is designed to process corporate tax returns with taxation years beginning on or after January 1, 2018, and ending on or before May 31, 2021.

You must use the appropriate prior version of Corporate Taxprep to prepare returns relating to a taxation year that begins before that period. To obtain a list of prior Corporate Taxprep versions and corresponding taxation years, consult the “Version Coverage” topic.

Default Taxation Year

The default taxation year for a new client file is January 1, 2020, to December 31, 2020.

Specialized Information, Advanced Network and Corporation Internet Filing Modules

The modules Specialized Information (SI), Advanced Network and Corporation Internet Filing are options sold separately from the program.

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Training

Webinars are available too allow you to familiarize yourself with the different functionalities of Taxprep. To learn about the presentation dates and register for the session most convenient for you, consult the training sessions calendar.

To consult the other training options available regarding Corporate Taxprep (seminars, Webinars, tutorials and more), access the "Training" section of the Taxprep Web site. You can also access it from the program, by selecting Get Taxprep Training in the Help menu.

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Overview – Version 2020 2.1

Addition of new Québec forms

The following four new Revenu Québec forms have been added to this version:

• CO-1029.8.33.CS, Tax Credit for SMBs that Employ Persons with a Severely Limited Capacity for Employment.
• CO-1029.8.36.II, Tax Credit for Investment and Innovation;
• CO-1029.8.36.IK, Cumulative Limit Allocation Agreement for the Tax Credit for Investment and Innovation;
• CO-1029.8.36.PS, Tax Credit to Support Print Media Companies; and

For more information, consult the notes on these topics.

Modifications to the Saskatchewan lower tax rate

As a result of changes announced by the Government of Saskatchewan, modifications have been made to the Saskatchewan lower tax rate for corporations that have days in their taxation year that are after September 30, 2020.

For more information, consult the note on this topic.

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New Forms – Version 2020 2.1

Québec

CO-1029.8.33.CS, Tax Credit for SMBs That Employ Persons with a Severely Limited Capacity for Employment (Jump Code: 1029833CS)

This multiple copy form is for any corporation that has an establishment in Québec where it carries on a business, has a specified paid-up capital for the previous taxation year, including that of the members of an associated group, of less than $15 million and whose number of remunerated hours of its employees, calculated for the taxation year, is greater than 5,000 (provided it is not a corporation in the primary or manufacturing sector). The refundable tax credit is calculated on the employer’s contributions paid by the corporation with respect to an employee.

The “Identification” custom section has been added on screen only. The answers to the questions Is the paid-up capital determined for the preceding taxation year, including that of members of an associated group, less than $15 million? and Does the number of remunerated hours of its employees, calculated for the taxation year, exceed 5,000 or is the corporation in the primary or manufacturing sector? will be defined when the qualified or specified expenditure is incurred by the corporation.

The answer to the question Is the paid-up capital determined for the preceding taxation year, including that of members of an associated group, less than $15 million? will be “Yes” when the amount on the line Paid-up capital of the previous taxation year used for the calculations of Form CO-1029.8.33.CS of the filing corporation plus the total of the amounts on the lines Paid-up capital of the previous taxation year (adjusted) of the associated corporations entered in Schedule 9 WORKCHART (Jump Code: 9 WORKCHART) is less than $15 million.

The answer to the question Does the number of remunerated hours of its employees, calculated for the taxation year, exceed 5,000 or is the corporation in the primary or manufacturing sector? will be “Yes” when the number of hours on line 07a or 07b of Form CO-771 (Jump Code: 771) is greater than 5,000 or if the proportion of activities in the primary sector or the manufacturing sector indicated on line 187c of Form CO-771 is greater than 25%.

For each eligible employee, complete Part 2.

When opening a client file prepared with a prior version of Corporate Taxprep, if an amount was entered on line 107 of Form QC L440P-Y (Jump Code: L440P), it will be retained as an overridden amount. Complete the sections of Form CO-1029.8.33.CS relating to this credit and cancel the override on line 110 of Form QC L440P-Y for the credit calculated in Form CO-1029.8.33.CS to be updated in Form QC L440P-Y.

CO-1029.8.36.II, Tax Credit for Investment and Innovation (Jump Code: 1029836II)

This multiple copy form must be completed by any corporation that has a permanent establishment in Québec where it carries on a business, and that incurred specified expenses after March 10, 2020, to acquire specified property that is manufacturing or processing equipment, computer equipment or certain software packages.

A corporation can claim the tax credit as a corporation, a member of a qualified partnership or as a party to a joint venture. An Identification custom section has been added, on screen only, to allow you to identify the qualified entity that incurred the specified expenses.

Parts 2 to 4 should be completed on a separate form for each zone in which the specified property was used as well as when the corporation claims the tax credit as a corporation and as a member of a partnership or as part of a joint venture. Parts 5 to 12 are only completed once and are printed only on the first copy of the form.

The specified expenses incurred in the taxation year to acquire specified property that exceed the cumulative limit of $100 million of dollars are not eligible for the tax credit. The tax credit is calculated on the portion of these specified expenses related to each specified property in excess of $12,500 ($5,000 for computer equipment and qualified software packages). On screen, the table in Section 5.1, Specified expenses for the year after taking the annual limit balance into account has been split into three separate sections, i.e., Section 5.1A, Expenses incurred by the corporation, Section 5.1B, Expenses incurred by the partnership and Section 5.1C, Expenses incurred by the parties to a joint venture. Section 5.1B is displayed and must be completed for each different qualified partnership entered on line 36 of Part 4 in the copies of the form, while a Section 5.1C is displayed and must be completed for each copy of the form for which the selected specified entity in the Identification custom section is a joint venture.

All or part of the tax credit calculated for a taxation year is refundable when the total assets and gross revenue for the previous taxation year of the corporation (including the amounts for the associated corporations) are less than $100 million. The non-refundable portion of the tax credit for a taxation year can be carried back three taxation years (that end after March 10, 2020) and carried forward twenty taxation years. A custom table, Summary and analysis of credit available for carryforward, which is displayed on screen only, has been added at the end of the form to recognize the amounts of the tax credit that can be carried forward.

When opening a client file prepared with a prior version of Corporate Taxprep, if an amount is entered on the line corresponding to code 109 of Form QC L440P-Y (Jump Code: L440P), it will be retained as an overridden amount.

You will then have to complete Form CO-1029.8.36.II, cancel the override on line 109 of Form QC L440P-Y in order for the credit calculated in Form CO-1029.8.36.II to be updated.

CO-1029.8.36.IK, Cumulative Limit Allocation Agreement for the Tax Credit for Investment and Innovation (Jump Code: 1029836IK)

This new form is to be completed by a corporation that is claiming the tax credit for investment and innovation and wishes to agree with the corporations associated with it on how to allocate the $100 million cumulative limit used to calculate this tax credit. The form is completed based on the information entered in the new Québec CO-1029.8.36.IK – Cumulative limit allocation agreement for the tax credit for investment and innovation section added in Schedule 9 WORKCHART (Jump Code: 9 WORKCHART). For more information, consult the note relating to Schedule 9 WORKCHART.

CO-1029.8.36.PS, Tax Credit to Support Print Media Companies (Jump Code: 1029836PS)

This multiple copy form is for any corporation that has an establishment in Québec where it carries on a business, that incurred qualified salary or wages after December 31, 2018, for eligible employees or that owns a qualified subsidiary that incurred such salary or wages for work done in the period, included in the corporation’s taxation year, that started after December 31, 2018, and ended before January 1, 2020. The refundable tax credit corresponds to an amount equal to 35% of the qualified salary and wages.

The Identification custom section has been added, on screen only, to allow you to identify the qualified entity that incurred the qualified salaries or wages. If the corporation claims the tax credit both as a qualified corporation and as a member of a qualified partnership, complete a copy of the form for each of these applications.

For each eligible employee, complete Parts 2 and 3 on a separate copy. The table in Part 4 will be completed with the information entered in Parts 2 and 3.

When opening a client file prepared with a prior version of Corporate Taxprep, if an amount is entered on line 108 of Form QC L440P-Y (Jump Code: L440P), it will be retained as an overridden amount. You will then have to complete the sections of Form CO-1029.8.36.PS relating to this credit and cancel the override on line 108 of Form QC L440P-Y in order for the credits calculated in Form CO-1029.8.36.PS to be updated in Form QC L440P-Y.

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Updated Forms – Version 2020 2.1

* Note that form titles followed by an asterisk (*) have been updated according to the most recent version issued by the applicable tax authority.

Federal

Schedule 9 WORKCHART, Related and Associated Corporations Workchart (Jump Code: 9 WORKCHART)

Section Québec CO-1029.8.36.II – Tax Credit for Investment and Innovation has been added to allow you to enter the gross revenue for the preceding taxation year of the reporting corporation and associated corporations. The total of these amounts is used to calculate the rate of refundability of the tax credit in Section 8.2 of Form CO-1029.8.36.II (Jump Code: 1029836II). For more information, consult the note relating to Form CO-1029.8.36.II.

Section Québec CO-1029.8.36.IK – Cumulative limit allocation agreement for the tax credit for investment and innovation has been added to allow you to complete the new Form CO-1029.8.36.IK (Jump Code: 1029836IK). In particular, you must enter in this section, for the reporting corporation and the corporations associated with it, the specified expenses and eligible expenses incurred in taxation years that ended in the 60-month period that preceded the beginning of the taxation year covered by the return. This data allows for the calculation of the cumulative limit balance for the tax credit for investment and innovation, which is afterwards allocated in Form CO-1029.8.36.IK. For more information, consult the note relating to Form CO-1029.8.36.IK.

Finally, for the first copy of Schedule 9 WORKCHART, the calculation of the amount shown in the Eligible expenses incurred in the taxation year concerned field of the Québec CO-1029.8.36.ID – Cumulative limit allocation agreement for the tax credit for investment section has been modified in order to no longer deduct the amount of excluded expenses. As a result of this modification, when rolling forward a client file, the rolled forward amount that will be entered in the Eligible expenses incurred in the taxation year that preceded the beginning of the taxation year concerned field of the Québec CO-1029.8.36.ID – Cumulative limit allocation agreement for the tax credit for investment section and included in the amount K in the Québec CO-1029.8.36.IK – Cumulative limit allocation agreement for the tax credit for investment and innovation section will no longer be reduced by the amount of excluded expenses.

Saskatchewan

Schedule 411, Saskatchewan Corporation Tax Calculation (Jump Code: 411)

In its Bill 2, tabled on December 7, 2020, the Government of Saskatchewan announced that the lower tax rate of 2% would be decreased to 0% as of October 1, 2020. The calculation on line 3A, which calculated the tax amount at the lower rate of 2%, has been modified to only take into account the number of days in the taxation year that are prior to October 1, 2020.

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Corrected Calculations

The following problem has been corrected in version 2020 2.1:

Network Versions

• Network Versions – Cannot start Corporate Taxprep 2020 v.1.x following the installation of version 2.0 because the data from the network configuration is invalid or corrupted

Diagnostics

• Error message when opening the diagnostics pane or when opening a client file because a customized diagnostic is missing or not found

Federal

• Schedule 322 – The rate used to calculate tax at the higher rate is incorrect for taxation years ending after December 31, 2020.
• The N1 diagnostic prevents the electronic filing and printing of the Bar codes and RSI for the T2 and AT1 returns even when no Mandatory modification diagnostics appear

Saskatchewan

• Schedule 411 – Reduction in the Saskatchewan lower tax rate for taxation years ending after September 30, 2020

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Overview – Version 2020 2.0

Corporate Taxprep 2020 v.2.0 includes several technical and tax changes. Here is a summary of the main topics addressed in this document.

E-Signature

The e-Signature feature was added to forms that can be electronically signed in Corporate Taxprep. For more information, consult the note on this topic.

New engagement letter

A new Engagement Letter has been added and allows you and your client to sign an agreement with respect to the engagement relating to corporation income tax preparation. For more information, consult the note on this topic.

Form T1134 update

Form T1134 has been updated and the information that must now be entered include important modifications for corporations with a taxation year starting after 2020. For more information, consult the note on this topic.

Addition of new Québec forms in a future version 2.1 2020

We expect to add four Revenu Québec forms in a future version 2.1 2020 which should be available at the end of February 2021. For more information, consult the note on this topic.

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Improve Your Productivity

E-Signature

The E-signature functionality was added to forms that can be electronically signed in Corporate Taxprep. For the complete list of forms that can be electronically signed, consult the article Digital Signature – Supported Forms.

Corporate Identification and Other Information (Jump Code: ID)

As per the CRA specifications, the telephone number format has been changed to support international telephone numbers. You can now enter telephone numbers that have between 10 and 15 digits. The numbers will be displayed as follows: 111222333444550. Note that North American telephone numbers will continue to have the traditional format, i.e., (514) 555-2221. This modification has been applied to all forms in the program except for Alberta schedules and Form MR-69 (Jump Code: MR69). If an international telephone number is entered, it will not update to these forms. In that situation, a diagnostic will prompt you to enter a 10-digit telephone number. In addition, lines 110 and 125, Fax number, of Form T661 (Jump Code: 661) have also been modified to support international fax numbers.

TaxprepConnect Download (Jump Code: CONNECT)

The following subsections have been added to the Return Balances section:

• Eligible refundable dividend tax on hand (ERDTOH) – available for taxation years starting in 2019 and after;
• Non-eligible refundable dividend tax on hand (NERDTOH) – available for taxation years starting in 2019 and after;
• Capital losses balance (CLB).

ECL, Engagement Letter (Jump Code: ECL)

The new Engagement Letter allows you and your client to sign an agreement with respect to the engagement relating to corporation income tax preparation. This letter contains the basic terms of the agreement for income tax preparation. Like all letters provided in the program, this letter can be customized according to the firm’s needs.

The new Engagement Letter template has been added. The content and print options have been added to the Client Letter tab of the Preparer Profiles and the Client letter Worksheet (Jump Code: LW). To make these options applicable, select the box(es) corresponding to your needs.

Preparer Profiles

PROFILE tab

The option Do not allow e-mail address entry in any of the forms in the return has been added to Section B. Options – Return in the PROFILE tab of the preparer profile. When this option is selected, a diagnostic will display in the return to prevent you from entering or editing information in the e-mail address fields. This option is set to No by default. Note that when converting the preparer profile, this option selection will be retained. The roll forward for the e-mail address is not impacted by this addition. Therefore, any e-mail address entered will be rolled forward.

AUTHORIZATION FORMS tab

As a result of the removal of the mention RC59 from the program, the section relating to the representative authorization form is now called AUTHORIZATION – Representative Authorization Request. The Filing subsection is now entitled Transmission and the following two options have been added:

• Transmit for clients for whom you do not have the authorization or whose authorization is expired: when selected, in Form Authorization (Jump Code: AUTHORIZATION), the question Do you want to transmit an authorization request for this business? will default to Yes in all client files in which the expiry date is passed or the answer to the statement This business already authorized you to access the Represent a Client service and your access is still valid is No in the Rolled forward data section;
• Do not transmit: when selected, the answer to the question Do you want to transmit an authorization request for this business? in Form Authorization will default to No in all client files.

EFILE tab

Because authorization and cancellation requests can only be electronically transmitted from the program, the options Select Forms RC59 for electronic filing and Select Forms RC59X for electronic filing have been removed from the Canada Revenue Agency section. The answer to the question Do you want to transmit an authorization request for this business? in Form Authorization will now be determined based on which option is selected in the Transmission subsection of the AUTHORIZATION – Representative Authorization Request section in the AUTHORIZATION FORMS tab.

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Deleted Forms

Federal

• Schedule 46, Part II - Tobacco Manufacturer's Surtax (Jump Code: 46)

Ontario

• Schedule 562, Ontario Sound Recording Tax Credit (Jump Code: 562)

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Updated Forms

* Note that form titles followed by an asterisk (*) have been updated according to the most recent version issued by the applicable tax authority.

Federal

Schedule 200, T2 Corporation Income Tax Return (Jump Code: J)*

In the Attachments section, line 272 relating to the applicability of Schedule 58 has been added and line 249 relating to the applicability of Schedule 46 has been removed.

In the Small business deduction (SBD) section, the fields used to calculate the SBD for days in the tax year before January 1, 2018, have been removed. As a result, lines 2 to 4 have been renumbered 1 to 3.

In addition, in accordance with subsection 227(14) ITA, which stipulates that Parts IV, IV.1, VI and VI.1 of the Income Tax Act do not apply to tax-exempt corporations, when either box 1, 2 or 4 is selected on line 085, If the corporations is exempt from tax under section 149, tick one of the following boxes, the amounts on the following lines are no longer calculated:

• line Q, Total Part IV tax payable from Schedule 3, in the Refundable dividend tax on hand (for tax years starting before 2019) section;
• in the Refundable dividend tax on hand (for tax years starting after 2018) section:

• line L, Part IV tax payable on taxable dividends from connected corporations (amount 2G from Schedule 3);
• line M, Part IV tax payable on eligible dividends from non-connected corporations (amount 2J from Schedule 3);
• line R, Part IV tax before deductions (amount 2A from Schedule 3); and
• line T, Part IV tax reduction due to Part IV.1 tax payable (amount 4D of Schedule 43).

• line 604, Refundable tax on CCPC's investment income, in the Part I tax section; and
• in the Summary of tax and credits section:

• line 716, Part IV.1 tax payable from Schedule 43;
• line 720, Part VI tax payable from Schedule 38; and
• line 724, Part VI.1 tax payable from Schedule 43.

Finally, in the Summary of tax and credits section, line 708 relating to the amount of Part II surtax payable from Schedule 46 has been removed.

When opening a client file prepared with a prior version of Corporate Taxprep, data entered on the removed lines will not be retained.

AUTHORIZATION, Representative Authorization Request (Jump Code: AUTHORIZATION)

The mention RC59 has been removed from the program. As a result, the jump code for the form has been changed from RC59 to AUTHORIZATION.

In addition, the fields Do you want to complete an authorization request for the current year?, Do you have a valid authorization? and You had a valid authorization in the previous year in the Rolled forward data section have also been removed. Finally, the field Access to the CRA's Represent a Client service is enabled has been renamed This business already authorized you to access the Represent a Client service and your access is still valid.

The question Do you want to transmit an authorization request for this business? in the Electronic filing section will determine if the form is to be filed.

When opening a client file prepared with a prior version of Corporate Taxprep, data entered on the removed lines will not be retained.

Cancellation, Request to Cancel Authorization for a Representative (Jump Code: CANCELLATION)

The mention RC59X has been removed from the program. As a result, the jump code for the form had changed from RC59X to CANCELLATION.

Schedule 1, Net Income (Loss) for Income Tax Purposes (Jump Code: 1)*

Schedule 2, Charitable Donations and Gifts (Jump Code: 2)*

Schedule 3, Dividends Received, Taxable Dividends Paid, and Part IV Tax Calculation (Jump Code: 3)*

Schedule 5, Tax Calculation Supplementary – Corporations (Jump Code: 5)*

Line 883, which relates to the British Columbia small business venture capital tax credit transferred on an amalgamation, has been added. In addition, the following lines have been removed from the schedule because the credits relating to these lines relate to taxation years starting before January 1, 2018:

• Line, 575, New Brunswick political contribution tax credit and line 894 Contribution;
• Line 464, Ontario sound recording tax credit (from Schedule 562);
• Line 603, Manitoba co-op education and apprenticeship tax credit (from Schedule 384);
• Line 612, Manitoba refundable cooperative development tax credit (from Schedule 390); and
• Line 630, Saskatchewan manufacturing and processing investment tax credit (from Schedule 402).

Furthermore, line 472, Ontario Regional Opportunities Investment Tax Credit, has been added under line 470. It allows you to enter the Ontario regional opportunities investment tax credit for the corporation.

Schedule 6, Summary of Dispositions of Capital Property (Jump Code: 6)*

Schedule 8 WORKCHART, Capital Cost Allowance (CCA) Workchart (Jump Code: 8 WORKCHART)

The new CCA class 56 has been added for properties acquired after March 1, 2020, and available for use before 2028, that are zero-emission automotive equipment and vehicles that currently do not benefit from the accelerated rate provided by classes 54 and 55. As for these two CCA classes, class 56 benefits from a temporary enhanced first-year CCA rate of 100% for eligible property available for use before 2024.

For classes 50 and 53, following the adoption of Bill 42 by the National Assembly of Québec on September 24, 2020, the line Capital cost of qualified property acquired in the current taxation year before July 1, 2019 in the Additional CCA of 60% - Qualified property that was acquired after November 20, 2018, and before December 4, 2018 section has been replaced by the following four custom lines:

• Capital cost of qualified properties acquired in the current taxation year before December 4, 2018, that are not AIIP;
• Capital cost of qualified properties acquired in the current taxation year before December 4, 2018, that are AIIP;
• Capital cost of qualified properties acquired in the current taxation year after December 3, 2018, and before July 1, 2019, that are not AIIP; and
• Capital cost of qualified properties acquired in the current taxation year after December 3, 2018, and before July 1, 2019, that are AIIP.

These four lines are used to calculate the amount on the line Amount added to the UCC attributable to qualified property, which replaces the line Half of the capital cost of qualified property that became available for use in the current taxation year in the calculation of the amount on line E.

When opening a client file prepared with a prior version of Corporate Taxprep, the four lines can contain amounts in the following situations:

• When Schedule 8 WORKCHART ADD (Jump Code: 8 WORKCHART ADD) is used, the four new lines can contain an amount when the amount entered on the line Capital cost of qualified property acquired in the current taxation year before July 1, 2019 is equal to the total of the amounts on the line Adjusted capital cost – Québec for each copy of the form concerning properties acquired in the taxation year after November 20, 2018, and before July 1, 2019, that are identified as not being eligible for the 30% additional CCA. The amount on each line will correspond to the total of the adjusted capital cost amounts in each copy of the workchart corresponding to the attributes mentioned in the description of the lines.
• When Schedule 8 WORKCHART ADD is not used and the amount on the line Additions (property subject to subsection 1100(2) ITR) in the Québec column is equal to the amount entered on the line Capital cost of qualified property acquired in the current taxation year before July 1, 2019, the amounts on the lines Capital cost of qualified properties acquired in the current taxation year after December 3, 2018, and before July 1, 2019, that are not AIIP and Capital cost of qualified properties acquired in the current taxation year after December 3, 2018, and before July 1, 2019, that are AIIP will be calculated when the tax year start is after December 3, 2018.
• In other cases, the amount on the line Capital cost of qualified property acquired in the current taxation year before July 1, 2019 will be retained, depending on the tax year start, on one of lines Capital cost of qualified properties acquired in the current taxation year before December 4, 2018, that are not AIIP or Capital cost of qualified properties acquired in the current taxation year after December 3, 2018, and before July 1, 2019, that are not AIIP. A diagnostic will prompt you to allocate this amount between the four lines.
• In addition, where the amounts on the four lines can be determined and the amount on the line Half of the capital cost of qualified property that became available for use in the current taxation year is not an overridden amount, the amount on the line Amount added to the UCC attributable to qualified property will be recalculated and will be equal to the total of the amounts determined on each line multiplied by the applicable adjustment factor.

When rolling forward a client file, the amount rolled forward to the line UCC of qualified property (giving rise to the additional CCA of 60%) that became available for use in the preceding taxation year will be equal to the difference between the total of the amounts on the four new lines and the result of the CCA claimed multiplied by the ratio between the amount on the line Amount added to the UCC attributable to qualified property and the amount on the line UCC in the class before CCA.

In all cases, verify that the amount updated to the new lines or rolled forward to the lines UCC of qualified property (giving rise to the additional CCA of 60%) that became available for use in the preceding taxation year and Amount of line E from the first year are accurate.

Schedule 12, Resource-Related Deductions (Jump code: 12)*

Custom lines S1 to S6 in Part 5, which are used to calculate the adjusted accelerated Canadian development expenses, have been replaced by lines 346, 347 and 370 and amounts G, H and I. In addition, two custom lines have been added in the Regular expenses column to detail the current year claim calculation for Canadian development expenses and the claim for accelerated Canadian development expenses. The total of these two custom lines now equals the amount on line 345.

Likewise, custom lines X1 to X6 in Part 6, which are used to calculate the adjusted accelerated Canadian oil and gas property expenses have also been replaced by lines 446, 447 and 451 and amounts L, M and N. In addition, two custom lines have been added in the Regular expenses column to detail the current year claim calculation for Canadian oil and gas property expenses and the claim for accelerated Canadian oil and gas property expenses. The total of these two custom lines now equals the amount on line 445.

Schedule 16, Patronage Dividend Deduction (Jump code: 16)*

Schedule 18, Federal and Provincial or Territorial Capital Gains Refund (Jump Code: 18)*

Schedule 21, Federal and Provincial or Territorial Foreign Income Tax Credits and Federal Logging Tax Credit (Jump Code: 21)*

The lines Additional deduction for credit unions (line 628) in Parts 7 and 8 were removed from the schedule. When opening a client file prepared with a prior version of Corporate Taxprep, if an amount was entered on these lines it will not be retained.

Schedule 23, Agreement Among Associated Canadian-Controlled Private Corporations to Allocate the Business Limit (Jump Code: 23)

The calculation of custom field Percentage required to maximize the SBD now takes into consideration the amount of passive investment income from line 417 of Schedule 200 (Jump Code: J) when this percentage is calculated for taxation years starting after 2018.

Schedule 25, Investment in Foreign Affiliates (Jump Code: 25)*

Schedule 27, Calculation of Canadian Manufacturing and Processing Profits Deduction (Jump Code: 27)*

Schedule 31, Investment Tax Credit - Corporations (Jump Code: 31)*

In Part 1, many specified percentage fields were removed because they related to expenditures incurred before 2016.

In Part 4, custom column Type of investment as well as Note 1 were removed because specifying the type of investment is no longer required because mining property must be acquired before 2017.

In Part 5, the field of line Qualified resource property acquired after December 31, 2013, and before January 1, 2016 (applicable part from amount A1 in Part 4) is now an input field, as it is no longer possible to have qualified mining property acquired before January 1, 2016 for a tax return supported by this version.

Line 360 in Part 8 was removed because capital expenditures have not been qualifying capital expenditures since January 1, 2014.

Part 10 was also modified because, for taxation years ending after March 18, 2019, the taxable income is no longer taken into account in calculating the SR&ED expenditure limit.

In Part 11, the lines relating to current and capital expenditures for a taxation prior to 2014 were removed.

Parts 18 and 20 as well as lines 870, 872, 874, 876, 880, q and H4 of Part 19, were removed as they related to pre-production mining expenditures incurred before 2016. As a result, Parts 19 and 21 to 30 were renumbered Parts 18 to 28.

When opening a client file prepared with a prior version of Corporate Taxprep, if an amount was entered on one of the removed lines or in the field of line Qualified resource property acquired after December 31, 2013, and before January 1, 2016 (applicable part from amount A1 in Part 4) of Part 5, it will not be retained.

A calculation has been added on line 103 of Part 3 by the CRA. Prior to the latest update, 80% of the contributions to agricultural organizations for SR&ED had to be entered in Part 8. However, as per a request by the CRA, 100% of the contributions to agricultural organizations for SR&ED must now be entered in Part 8. This amount will then be multiplied by 80% and the result of this calculation will be entered on line 103. In addition to 100% of the contributions to agricultural organizations for SR&ED, 100% of the government assistance, non-government assistance and contract payments related to these contributions must now be entered in Part 8. When opening a client file prepared with a prior version of Corporate Taxprep, make any required adjustments to the amounts entered in order for the amount on line 103 to be calculated correctly.

Schedule 39, Agreement Among Related Financial Institutions – Part VI Tax (Jump Code: 39)*

Schedule 49, Agreement Among Associated Canadian-Controlled Private Corporations to Allocate the Expenditure Limit (Jump Code: 49)*

Schedule 50, Shareholder Information (Jump Code: 50)*

A new column 200 has been added on screen only to indicate the account number for a partnership. If a partnership shareholder does not have a partnership account number, indicate “NR” (not registered) to indicate that the partnership is not registered.

Note that when printing, only one column 200 will display the business number or the partnership account number, as applicable.

Schedule 53, General Rate Income Pool (GRIP) Calculation (Jump Code: 53)*

Schedule 54, Low Rate Income Pool (LRIP) Calculation (Jump Code: 54)*

Schedule 55, Part III.1 Tax on Excessive Eligible Dividend Designations (Jump Code: 55)*

Schedule 71, Income Inclusion for Corporations that are Members of Single-Tier Partnerships (Jump Code: 71)*

The following parts as well as all custom subsections that were used to enter or calculate the amounts relating to each type of income were removed:

• Part 2, Eligible alignment income;
• Part 5, Qualifying transitional income (QTI);
• Part 6, Adjusted amount of qualifying transitional income;
• Part 7, Transitional reserve.

The remaining parts and lines were renumbered accordingly.

As a result, when opening a client file prepared with a prior version of Corporate Taxprep, if amounts were entered in the removed parts or custom subsections, they will not be retained.

Schedule 72, Income Inclusion for Corporations that are Members of Multi-Tier Partnerships (Jump Code: 72)*

The following parts and custom subsections that were used to enter or calculate the amounts relating to each type of income were removed:

• Part 2, Eligible alignment income;
• Part 5, Qualifying transitional income (QTI);
• Part 6, Adjusted amount of qualifying transitional income;
• Part 7, Transitional reserve.

In addition, in Part 3, only the former third subsection starting with the following sentence is retained: Complete this section if subparagraphs (b)(i) and (b)(ii) of the definition of “adjusted stub period accrual” in subsection 34.2(1) do not apply [paragraph (a) of the definition of “adjusted stub period accrual” in subsection 34.2(1)].

The remaining parts and lines were renumbered accordingly.

As a result, when opening a client file prepared with a prior version of Corporate Taxprep, if amounts were entered in the removed parts or custom subsections, they will not be retained. If the amount on line T in Part 3 is entered using an override, the amount will be retained as an overridden value on line 2I.

Schedule 73, Income Inclusion Summary for Corporations that are Members of Partnerships (Jump Code: 73)*

The following columns were removed from the table in Part 2:

• column 8, Eligible alignment income;
• column 9, Qualifying transitional income (QTI);
• column 10, Adjusted amount of QTI;
• column 11, Current-year transitional reserve;
• column 12, Previous-year transitional reserve.

Column 13 in Part 2 as well as columns 14 and 15 in Part 3 were renumbered.

As a result, when opening a client file prepared with a prior version of Corporate Taxprep, none of the amounts entered in one of the removed columns will be retained.

Schedule 88, Internet Business Activities (Jump Code: 88)*

Schedule 89, Request for Capital Dividend Account Balance Verification (Jump Code: 89)*

Following the update of the schedule, Part 1, CDA components (except for eligible capital property), is now Part 2 as Part 1, Identification, has been added to the form. As a result, all parts of the form have been renumbered.

In addition, column 2, Amount S from Schedule 10, which was under Section B: CDA components – List of ECP dispositions in former Part 2, has been removed. In new Part 3, the columns Cost of eligible capital property acquired and Proceeds of sale (less outlays and expenses not otherwise deductible) from the disposition of all eligible capital property have been added under Section B: CDA components – List of ECP dispositions. Furthermore, the field of column 4, Non-taxable portion of ECP sales, is now an input field. When opening a client file prepared with a prior version of Corporate Taxprep, if an amount was calculated or overridden in this field, it will be retained.

Schedule 125, Income Statement Information (Jump Code: G125)*

Inducement, Inducement Calculation Workchart (Jump Code: INDUCEMENT)

The field Canada emergency wages subsidy (CEWS) and Canada emergency rent subsidy (CERS) has been added to the Federal subsection in the Tax credits whose amount should be added to income section.

In addition, the line Ontario regional opportunities investment tax credit has been added to the Ontario subsection of the Tax credits whose amount should reduce the capital cost of property section.

RC4649, Country-by-Country Report (Jump Code: RC4649)*

T183, Information Return for Corporations Filing Electronically (Jump Code: T183)*

T661, Scientific Research and Experimental Development (SR&ED) Expenditures Claim (Jump Code: 661)*

The following lines, which relate to capital expenditures, were removed from the form, because they refer to a taxation year ended before 2014:

• 350, 355, 390 and 400 in Section B of Part 3; and
• 496, 504, 510, 512, 514b, 514b1, 514b2, 514c, 514d, 514e, 514, 516, 518, 532, 535, 540, 543, 546 and 558 in Part 4.

In part 4, line 528 has been renamed 80% of the amounts paid in respect of an SR&ED contract to a person or partnership that is not a taxable supplier. In addition, line 557 was replaced by line 559.

The rate used to calculate the prescribed proxy amount (PPA) is 55% for a taxation year started after 2013. In that respect, the calculations for obsolete periods in Section B of Part 5 were removed.

In the table in Part 6, column 758, Overhead and other expenditures in the tax year (total of line 360, if applicable), has been added. The fields in this column must be completed if the traditional method is used and the information is mandatory for a taxation year end after 2020 and optional for a taxation year end before 2021. To generate data in this column, data must be entered on line 758 of Form T661 Part 2 (Jump Code: 661 PART 2) for the project involved. Note that the amount on this line will affect the total project cost.

The year’s maximum pensionable earnings amount for purposes of the Canada pension plan has been updated for the 2021 calendar year (and is now $61,600). This amount is used to determine the specified employees’ salary or wages in Part 5 when the proxy method is selected to calculate the SR&ED expenditures.

T661 Part 2, Project Information (Jump Code: 661 PART 2)*

Following the addition of column 758 in Form T661 (Jump Code: 661), line 758, Overhead and other expenditures (Portion of the amount on line 360) was added under line 756. Note that the amount on this line will affect the total project cost.

T1044, Non-Profit Organization (NPO) Information Return (Jump Code: 1044)*

T1134, Information Return Relating to Controlled and Non-Controlled Foreign Affiliates (Jump Code: 1134)*

A new version of Form T1134 for taxation years starting after 2020 has been integrated into the program and only displays when the taxation year covered by the return starts after 2020. For taxation years starting prior to 2021, the previous version of the form must be used.

The new version of the form provides the ability, for a group of reporting entities that are related to each other, to file as a group. The information related to individuals, corporations, trusts and partnerships that are part of this related group must be indicated in new subsections A and B in Section 3 of Part I. Note that the taxation year-end or fiscal year-end date must be the same for all entities in the group. In addition, if an election to use functional currency was made, individuals and trusts cannot be part of the group.

The requirements for new subsection C in Section 3 of Part I (which corresponds to former Section 3 of Part I) can now be met by submitting a group organizational chart that includes the information requested in this subsection. When opening a client file prepared with a prior version of Corporate Taxprep in which the taxation year starts after 2020 or when rolling forward a client file in which the taxation year after roll forward is the first year starting after 2020, if data was entered in the tables of former Section 3 of Part I, the answer to the question Is the reporting entity submitting a group organizational chart for the required information noted in C. (i) through (iv)? located at the beginning of subsection C in Section 3 of Part I will be No.

Several tables have been added to the form to allow for the filing of the return by a group of related entities. Therefore, entities in the group that are indicated in subsection A of Section 3 in Part I will be used to form a list from which you will be able to select the relevant entities for the tables in Form T1134 Supplement. The layout of the form has also been revised and a lot of information that was already requested in the previous version of the form has been incorporated into the new tables. When opening a client file prepared with a prior version of Corporate Taxprep in which the taxation year starts after 2020 or when rolling forward a client file in which the taxation year after roll forward is the first year starting after 2020, data entered in the previous version of the form will be retained in the corresponding fields of the new version of the form, when applicable. We strongly suggest that you carefully review the information retained in this situation to ensure it is correct.

Finally, when opening a client file prepared with a prior version of Corporate Taxprep in which the taxation year covered by the return starts after 2020:

• The amounts that were entered in the table in Section 2 of Part III will be rounded to the nearest thousand, then retained on the corresponding line in the column Total gross revenues (all sources) in the table of Section 2 in Part III. Currency codes will also be retained on the corresponding lines. More specifically, the amounts on line (i) and in field Interest – Other will be added, then retained on line (i) only if the currency is the same for these two amounts. Similarly, the amounts on line (ii) and in field Dividends – Other will be added, then retained on line (ii) only if the currency is the same for both amounts;
• If an amount was entered on one of lines (i) to (vi) in Section 3 of Part III, it will be retained on the corresponding line among lines (a) to (f) in table (iv) of Section 3 in Part III, in column FAPI if it is positive or in column FAPL as an absolute value if it is negative;
• If an amount was entered on line (vii) in Section 3 of Part III, it will be retained in the field shares of table (iv) in Section 3 of Part III, in column FAPI if it is positive or in column FACL as an absolute value if it is negative. Verify if this amount should be retained in the field other than shares of the same table instead;
• If a positive amount was entered line (viii) in Section 3 of Part III, it will be retained on line (i) in table (iv) of Section 3 of Part III. If a negative amount was entered on line (viii) in Section 3 of Part III, it will not be retained.

T1135, Foreign Income Verification Statement (Jump Code: 1135)*

T1145 (Schedule 61), Agreement to Allocate Assistance for SR&ED Between Persons Not Dealing at Arm's Length (Jump Code: 1145)*

Lines 015, Current expenditures, and 020, Capital expenditures, have been removed from the form. However, the allocated amount of assistance for SR&ED must be entered on line 010, The transferor and the transferee identified below hereby agree to allocate this amount of assistance for SR&ED to the transferee. When the corporation is the transferee, the amount from line 010 is transferred to line 538 of Form T661 (Jump Code: 661). When opening a client file prepared with a prior version of Corporate Taxprep, the amount entered on line 010 will be retained as an input amount.

T1146 (Schedule 62), Agreement to Transfer Qualified Expenditures Incurred in Respect of SR&ED Contracts Between Persons Not Dealing at Arm’s Length (Jump Code: 1146)*

Lines 015, Current expenditures and 020, Capital expenditures have been removed from the form. However, there no longer is an allocation of the amount on 010, The transferor and the transferee identified below hereby agree to transfer the amount of SR&ED qualified expenditures to the transferee to lines 015 and 020. When the corporation is the transferor, the amount on line 010 is transferred to line 544 of Form T661 (Jump Code: 661) and, when the corporation is the transferee, on line 508.

T2054, Election for a Capital Dividend Under Subsection 82(2) (Jump Code: 2054)*

The field related to the tax services office has been removed from Part 1. In addition, a field for the telephone extension number has been added to this part. If the contact person is the same person as the authorized signing officer, the extension number will be updated from the authorized signing officer information entered in Form Identification (Jump Code: ID). If this is not the case, enter the extension number in the new field.

AgriStability and AgriInvest Programs (Jump Code: AGRI/HAGRI) – Ontario*

AgriStability and AgriInvest Programs (Jump Code: AGRI/HAGRI) – Harmonized Provinces* and British Columbia*

The line Trust business number has been added to the Participant identification section.

AgriStability and AgriInvest – Programs (Jump Code: AGRI/HAGRI) – Alberta*

AgriStability and AgriInvest – Programs (Jump Code: AGRI/HAGRI) – Saskatchewan*

AgriStability and AgriInvest Additional Information and Adjustment Request (Jump Code: HAGRI ADD)*

Instalments, Federal Tax Instalments (Jump Code: IFED)

As a result of the announcement by the CRA that the payment date of September 30, 2020, applies to instalments under other Parts of the Act as well as to instalments under Part I, all the amounts in sections and lines that referred specifically to Part I tax and Parts VI, VI.1 and XIII.1 tax in Sections 1 – 1st Instalment base method, 2 – Combined 1st and 2nd instalment base method and 3 – Estimated tax method, that were calculated when the answer to the question Do you want to calculate the instalments according to the extended payment date (COVID-19)? is Yes, have been removed. In addition, lines L1 to N2 in the Instalment base calculation according to the Parts of the Act subsection of the Instalment base calculation section have also been removed.

When opening a client file prepared with a prior version of Corporate Taxprep, if the answer to the question Do you want to calculate the instalments according to the extended payment date (COVID-19)? is Yes and an amount is overridden on one of the removed lines relating to Parts VI, VI.1 and XIII.1 tax in Sections 1 – 1st Instalment base method, 2 – Combined 1st and 2nd instalment base method and 3 – Estimated tax method, this amount is added to the amount on the line relating to Part I tax and the result is retained, as an overridden value, on the line bearing the same general description. For example, if the amount on line 1st Instalment base amount – Parts VI, VI.1 and XIII.1 tax is overridden, this amount is added to the amount on line 1st Instalment base amount – Part I tax and the result is retained, as an overridden value, on line 1st Instalment base amount.

Furthermore, in the Instalment base calculation section, if one of the amounts on lines L1 to N2 is overridden, the total of the amounts on lines N1 and N2 will be retained on line N in the corresponding column.

INTEREST, Interest and Late-filing Penalty (Jump Code: INTEREST)

As a result of the announcement by the federal government that the extended balance-due day of September 30, 2020, applies to the balance of tax payable under other Parts of the Act as well as to tax payable under Part I, in the Federal section, the question Do you want to calculate the interest on the balance unpaid for Part I tax and provincial and territorial tax separately from the tax on other Parts of the Act (COVID-19)? as well as all the fields that could be calculated when the answer to this question is Yes have been removed. The targeted fields are:

• The fields in subsections Part I tax and provincial and territorial tax and Tax from other Parts of the Act;
• The fields in the Calculation of interest on balance unpaid – Part I tax and provincial and territorial tax (COVID-19) and Calculation of interest on balance unpaid – Tax from other Parts of the Act (COVID-19) subsections of the Interest section; and
• The fields Payment made after – and on or before, Interest on balance unpaid – Part I tax and provincial and territorial tax (COVID-19) and Interest on balance unpaid – Tax from other Parts of the Act in the Total amount owed subsection.

The field Unpaid tax balance has been added in the Dates subsection.

When opening a client file prepared with a prior version of Corporate Taxprep, when the answer to the question Do you want to calculate the interest on the balance unpaid for Part I tax and provincial and territorial tax separately from the tax on other Parts of the Act (COVID-19)? is Yes, the following calculations are performed:

• If an amount is entered in one of fields Balance payable according to the T2 return – Part I tax and provincial and territorial tax or Balance payable according to the T2 return – Tax from other Parts of the Act, using an override, the total of the amounts entered in both fields will be retained as an overridden value in the new field Unpaid tax balance.
• If an amount is entered in the field Payment made after – and on or before, the total of the amounts entered in that field and the field Payment made on or before will be retained in the latter.

Data entered in the other removed fields will not be retained.

In addition, the CRA announced that it would waive interest on existing tax debts for the 2nd and 3rd quarters of 2020 (from April 1, 2020, to September 30, 2020). In the Rates subsection of the Federal section, when one of the quarters starts on April 1, 2020, or July 1,2020, the corresponding interest rate will be calculated to 0%.

Client Letter, Client Letter Worksheet (Jump Code: LW)

As a result of the announcement by the CRA that the extended balance-due day of September 30, 2020, applies to the balance of tax payable under other Parts of the Act as well as to tax payable under Part I, the fields in the COVID-19 – Balances-due dates (extended) subsection have been removed. As a replacement, the question Do you want to use the extended balance-due day (COVID-19)? and the field Extended balance-due day have been added.

When the answer to this question is Yes, the date in the field Extended balance-due day is used in the Client Letter, Filing Instructions (Jump Code: CLF) as well as in Form Interest and Late-filing Penalty (Jump Code: INTEREST).

When opening a client file prepared with a prior version of Corporate Taxprep, if data had been entered in the removed fields, it will not be retained.

Ontario

Schedule 500, Ontario Corporation Tax Calculation (Jump Code: 500)*

In Part 2, the line that related to the calculation of the Ontario small business deduction rate for the period before January 1, 2018, (former line 2N.1) was removed.

When opening a client file prepared with a prior version of Corporate Taxprep, if a rate was entered on this line, it will not be retained.

As a result of the update of the schedule, several lines have been renumbered, in particular custom lines 2N.2, 2N.3, which have been renumbered 2M and 2N in Part 2. These new lines allow for the Ontario small business deduction to be calculated based on the number of days in the tax year before January 1, 2020, and the number of days in the tax year after December 31, 2019. Previously, lines 2N.2 and 2N.3 were used to calculate the small business deduction rate, which means that the calculation of this deduction has been condensed. Therefore, line 2N.4, which was used to add the rates from lines 2N.1 to 2N.3, has been removed as it was no longer useful. When opening a client file prepared with a prior version of Corporate Taxprep, the values that were indicated on former lines 2N.1, 2N.2, 2N.3 and 2N.4 will not be retained.

In addition, following the modifications in Part 2, lines 4D and 4E have been added to Part 4 to allow for the Ontario credit union tax reduction to be calculated based on the number of days in the tax year before January 1, 2020, and the number of days in the tax year after December 31, 2019.

Schedule 502, Ontario Tax Credit for Manufacturing and Processing (Jump Code: 502)*

As a result of the update of the schedule, several lines have been renumbered. The amount on the new line 1C is now calculated according to provisions of the federal legislation. Verify if an adjustment should be made according to provisions of the Ontario legislation and override if required. When opening a client file prepared with a prior version of Corporate Taxprep, if an amount had been entered in former field Notional resource allowance for the year (amount from line 105 of Schedule 504), it will be retained as an overridden amount on the new line 1C.

In addition, former line c in Part 2, which allowed for the calculation of the tax credit for the period before July 1, 2011, has been removed from the schedule because it was obsolete. When opening a client file prepared with a prior version of Corporate Taxprep, if an amount had been entered using an override on former line H, it will be retained as an overridden amount on the new line 2N.

Finally, Part 5 has been added to the schedule to allow for the calculation of the adjusted Crown royalties for the tax year, which is calculated on line 5H and is updated to line 1A. When opening a client file prepared with a prior version of Corporate Taxprep, if an amount had been entered in former field Adjusted Crown royalties for the year (amount from line 100 of Schedule 504, Ontario Resource Tax Credit), it will be retained as an overridden amount on the new line 1A.

Schedule 504, Ontario Resource Tax Credit (Jump Code: 504)*

Schedule 508, Ontario Research and Development Tax Credit (Jump Code: 508)

Following the removals related to capital expenditures in Form T661 (Jump Code: 661), on screen custom lines Current expenditures and Capital expenditures of lines 110 and 115 have been removed. In addition, the column Capital Expenditures has been removed from the Schedule A section. For more details, consult the note on Form T661.

Schedule 558, Ontario Production Services Tax Credit (Jump Code: 558)*

Former Parts 4, 5 and 8 as well as line 715 have been removed from the schedule, because they were referring to expenditures incurred before April 24, 2015. When opening a client file prepared with a prior version of Corporate Taxprep, the amounts entered in these parts and on this line will not be retained.

In addition, line 2 in former Part 9 has been replaced by lines 2 to 5 in Part 6, in accordance with subsection 92(5.1.3) of the Taxation Act, 2007 (Ontario). When opening a client file prepared with a prior version of Corporate Taxprep, if an amount had been entered on line 2 in former Part 9, using an override, it will be retained as an overridden amount on line 2 in Part 6. Verify if this amount should be split between the amounts on lines 2 to 5 in Part 6.

Also note that the amounts on lines 1 to 6 in Part 6 are calculated based on the amounts entered on lines 730 to 745. Verify if adjustments are required in accordance with subsection 92(5.1.2) of the Taxation Act, 2007 (Ontario) and perform any required overrides.

Schedule 560, Ontario Interactive Digital Media Tax Credit (Jump Code: 560)*

Schedule 566, Ontario Innovation Tax Credit (Jump Code: 566)

Following the removals related to capital expenditures in Form T661 (Jump Code: 661), custom columns Current Expenditures and Capital Expenditures in Part 7 have been removed. In addition, the column Capital Expenditures has been removed from the Schedule A section. For more details, consult the note on Form T661.

Québec 

Addition of new Québec forms in a future version 2.1 2020

We expect to add the following four new Revenu Québec forms in a future version 2.1 2020:

• CO-1029.8.36.II, Tax Credit for Investment and Innovation;
• CO-1029.8.36.IK, Cumulative Limit Allocation Agreement for the Tax Credit for Investment and Innovation;
• CO-1029.8.36.PS, Tax Credit to Support Print Media Companies; and
• CO-1029.8.33.CS, Tax Credit for SMBs that Employ Persons with a Severely Limited Capacity for Employment.

If you need to file these forms with a tax return and you can wait until the end of February 2021, we suggest that you wait for version 2.1 2020, which should be available for download at that time.

CO-17, Corporation Income Tax Return (Jump Code: QJ)*

The question on line 19b, Did the corporation receive or dispose of (sell, transfer, exchange, gift, etc.) virtual currency? has been added to Part 2. In addition, the question on former line 26, Is the corporation a general partner, or a party to either a contract of mandate or a contract of prête-nom? and the line Where applicable, state the object of the contract of prête-nom have been removed.

Note that the following special tax codes can now be selected on lines 425ai and 425bi:

• 100, Deduction relating to the commercialization of innovations in Québec; and
• 101, Deduction relating to the Ssynergy capital tax credit.

The registration fees on line 441b will be indexed on January 1, 2021. The amount for cooperatives will increase from $42 to $43, the amount for non-profit legal persons (incorporated association), a syndicate of co-ownership and fraternal benefit societies, will remain at $36, and the amount for corporations, mutual insurance corporations and other entities, will increase from $92 to $93.

QC L265-266, Deductions from Taxable Income (Jump Code: L265/266)

The following code has been added to the form:

• 18, Deduction relating to the commercialization of innovations in Québec.

QC L421B-421F, Deduction in the Tax Calculation (Jump Code: L421B)

The following codes have been added to the form:

• 312, Deduction relating to the synergy capital tax credit – current year
• 313, Deduction relating to the synergy capital tax credit – previous year
• 314, Deduction relating to the synergy capital tax credit – subsequent year

CO-17.B.1, Amount to Be Included in the Income of a Corporation That Is a Member of Single-Tier Partnership (Jump Code: Q17B1)

Following the update of federal Schedule 71 (Jump Code: 71), when opening a client file prepared with a prior version of Corporate Taxprep, the amounts in Parts 3, 6, 7 and 8, calculated from the corresponding lines in the removed parts in Schedule 71, will be retained as input amounts.

CO-17.B.2, Amount to Be Included in the Income of a Corporation That Is a Member of Multi-Tier Partnership (Jump Code: Q17B2)

Following the update of federal Schedule 72 (Jump Code: 72), when opening a client file prepared with a prior version of Corporate Taxprep, the amounts in Parts 3, 6, 7 and 8, calculated from the corresponding lines in the removed parts in Schedule 72, will be retained as input amounts.

CO-17.R, Request for an Adjustment to a Corporation Income Tax Return or to an Information and Income Tax Return for Non-Profit Corporations (Jump Code: QJR)*

CO-771, Calculation of the Income Tax of a Corporation (Jump Code: 771)*

Line 05a in Part 1, Information about the corporation as well as lines 180 to 186 in Section 11.1, Proportion of manufacturing and processing activities (taxation year beginning before January 1, 2017) can no longer be accessed as they relate to taxation years starting before January 1, 2018.

When opening a client file prepared with a prior version of Corporate Taxprep, if the box on line 05a had been selected and amounts had been entered on lines 180 to 186, the values on these lines will not be retained.

CO-1029.8.33.13, Tax Credit for the Reporting of Tips (Jump Code: 102983313)*

This form has been updated in order to integrate the various applicable rates for 2021.

CO-1029.8.35, Tax Credit for Québec Film Productions (Jump Code: 1029835)*

CO-1029.8.36.DA, Tax Credit for the Development of E-Business (Jump Code: 1029836DA)*

Parts 2 and 3 have been modified to reflect the calculation as per the “qualified salary or wages” definition of section 1029.8.36.0.3.79 of the Taxation Act.

For each employee with regard to whom the corporation is claiming the tax credit, a separate copy of Form CO-1029.8.36.DA PARTS 2 and 3 must be completed. To complete Part 2 and, if required, Part 3 for each eligible employee, access Form CO-1029.8.36.DA PARTS 2 and 3 from Part 2-3, Qualified salary or wages and percentage of the qualified salary or wages that may give rise to more than one tax credit.

In addition, check box 11 has been added to section 2.1, Identification of the employee, to determine whether the salary or wages incurred for the employee is subject to more than one tax credit.

In subsection 2.2.1, line 21e has been added and replaces line 21a and line 21c has been added to enter the percentage of qualified salary or wages that may give rise to more than one tax credit calculated in Part 3.

Lines 33a and 33b have been added to subsection 2.2.2 to apply the percentage of qualified salary or wages that may give rise to more than one tax credit.

Field 38c has been removed from Part 3 and field 40 is now used to calculate the percentage of qualified salary or wages instead of the reduced qualified salary or wages.

When opening a client file prepared with a prior version of Corporate Taxprep, for each eligible employee listed in Part 2, a separate copy of Form CO-1029.8.36.DA PARTS 2 and 3 will be created. In addition, if an amount had been entered on line 36 and/or 37, check box 11 will be selected. In addition, if no amount had been entered on lines 36 and/or 37, the amount entered on line 21a will be retained on line 21e. Otherwise, recalculate the portion of the amount on line 21d that is attributable to eligible work carried out by the employee and whose ultimate beneficiary is a government entity and enter this amount on line 21e. Finally, if an amount had been overridden on line 40, it will not be retained.

CO-1029.8.36.ES, Tax Credit for the Production of Sound Recordings (Jump Code: 1029836ES)*

When opening a client file prepared with a prior version of Corporate Taxprep, if an answer to the question Was the application for an advance ruling, or the application for a qualification certificate if no application for an advance ruling was previously files, filed with the SODEC after March 10, 2020? was provided n the Information about the qualified property section, the answer will be moved between boxes 12c and 12d, as the case may be.

CO-1029.8.36.IN, Tax Credit for Investment (Jump Code: 1029836IN)*

The option to calculate the tax credit for eligible expenditures incurred before January 1, 2017, in the Identification section has been removed. When opening a client file prepared with a prior version of Corporate Taxprep, the data for this option will not be retained.

In addition, Section 2.2 has been added to identify property for which an election has been made to consider such property as qualified property for the application of the tax credit for investment instead of specified property for the application of the new tax credit for investments and innovation. When an election is made, this section must be signed. Note that it can be signed electronically.

CO-1029.8.36.PM, Tax Credit for Corporations Specialized in the Production of Multimedia Titles (Jump Code: 1029836PM)*

CO-1029.8.36.SM, Tax Credit for the Production of Performances (Jump Code: 1029836SM)*

Following the update of the form, custom question Was the first eligibility period of the performance ending after March 10, 2020, and was the application for an advance ruling (or the application for a qualification certificate if no application for an advance ruling was previously filed) filed with SODEC after March 10, 2020? has been replaced by the text of box 09a.

In addition, when box 09a is selected, you will no longer be able to select boxes 10c, 10d or 10e at the same time.

When opening a client file prepared with a prior version of Corporate Taxprep, if the answer to the custom question is Yes, box 09a will be selected. As well, if either one of boxes 10c, 10d or 10e was selected and the answer to the custom question was Yes, only box 09a will be selected.

CO-1029.8.36.TM, Tax Credit for Multimedia Titles (Jump Code: 1029836TM)*

CO-1159.2, Compensation Tax for Financial Institutions (Jump Code: 11592)*

Box 06A is now box 06a and still allows you to indicate whether the corporation is an independent loan corporation, an independent trust corporation or an independent corporation trading in securities. However, this box no longer needs to be selected at the same time as box 06. Only one of boxes 06 and 06a must be selected. When opening a client file prepared with a prior version of Corporate Taxprep, if both boxes 06 and 06A were selected, only box 06a will remain selected.

RD-1029.7, Tax Credit for Salaries and Wages (R&D) (Jump Code: 10297)*

RD-1029.8.6, Tax Credit for University Research or Research Carried Out by a Public Research Centre or a Research Consortium (Jump Code: 102986)*

When the answer to the custom question Does the taxation year of the corporation that incurred qualified expenditures or the fiscal period of the qualified partnership that incurred qualified expenditures start after March 10, 2020, and was the research and development work carried out after that date? is Yes, no data will be updated to the lines in Sections 4.1, Exclusion threshold and 4.2, Amount of reducible expenditures.

RD-1029.8.9.03, Tax Credit for Fees and Dues Paid to a Research Consortium (Jump Code: 10298903)*

When the answer to the custom question Does the taxation year of the corporation that incurred qualified expenditures or the fiscal period of the qualified partnership that incurred qualified expenditures start after March 10, 2020, and was the research and development work carried out after that date? is Yes, no data will be updated to the lines in Sections 6.1, Exclusion threshold and 6.2, Amount of reducible expenditures.

RD-1029.8.16.1, Tax Credit for Private Partnership Pre-Competitive Research (Jump Code: 10298161)*

When the answer to the custom question Does the taxation year of the corporation that incurred qualified expenditures or the fiscal period of the qualified partnership that incurred qualified expenditures start after March 10, 2020, and was the research and development work carried out after that date? is Yes, no data will be updated to the lines in Sections 4.1, Exclusion threshold and 4.2, Amount of reducible expenditures.

TP-1029.9, Tax Credit for Taxi Drivers or Taxi Owners (Jump Code: 10299)*

On November 6, 2020, the Government of Québec announced in Information Bulletin 2020-12, that the tax credit for taxi owners will be eliminated for a taxation year or a fiscal period that starts after October 9, 2020. In that situation, no credit will be calculated in Section 3.4.

To claim the tax credit for taxi owners for a taxation year or fiscal period that starts after December 31, 2019, the taxation year or fiscal period must include October 9, 2020, and the income entered on lines 56, 57 and 58 must be attributable to the portion of the taxation year or fiscal period that precedes October 10, 2020.

British Columbia

Schedule 421, British Columbia Mining Exploration Tax Credit (Jump Code: 421)*

Schedule 422 (T1196), British Columbia Film and Television Tax Credit (Jump Code: 1196)*

Schedule 423 (T1197), British Columbia Production Services Tax Credit (Jump Code: 1197)*

Schedule 425 (T666), British Columbia Scientific Research and Experimental Development Tax Credit (Jump Code: 425)

Following the removals related to capital expenditures in Form T661 (Jump Code: 661), the column Capital (before 2014) in the Schedule A section has been removed. For more details, consult the note on Form T661.

Schedule 427, British Columbia Corporation Tax Calculation (Jump Code: 427)*

In Part 2, line 2A.1 relating to the lower tax rate for the period prior to April 1, 2017, and line 2B.1 relating to the higher tax rate for the period prior to January 1, 2018, were removed. When opening a client file prepared with a prior version of Corporate Taxprep, if an amount was entered on one of those lines, it will not be retained.

Schedule 428, British Columbia Training Tax Credit (Jump Code: 428)*

Schedule 430, British Columbia Shipbuilding and Ship Repair Industry Tax Credit (Jump Code: 430)*

Columns E1 and F1 in section 1 and columns E4 and F4 in section 3, that were related to the British Columbia Training Tax Credit, have been removed. As a result, columns G1 and G4 have been renamed E1 and E4, respectively.

When opening a client file prepared with a prior version of Corporate Taxprep, if an amount had been entered or overridden in columns E1, F1, E4 and F4, the amount will not be retained.

Alberta

AT1, Alberta Corporate Income Tax Return (Jump Code: AJ)*

AT1 Schedule 1, Alberta Small Business Deduction (Jump Code: A1)*

AT1 Schedule 9, Alberta Scientific Research & Experimental Development (SR&ED) Tax Credit (Jump Code: A9)

Following the removals related to capital expenditures in Form T661 (Jump Code: 661), the lines Portion of Alberta capital expenditures included in the amount of line 031 in the Eligible Expenditures for Alberta Purposes section, Current expenditures and Capital expenditures in the Maximum Expenditure Limit section and Capital expenditures in the Alberta SR&ED Tax Credit section have been removed. For more details, consult the note on Form T661.

AT100, Preparing and Filing the Alberta Corporate Income Tax Return (Jump Code: A100)*

Saskatchewan

Schedule 402, Saskatchewan Manufacturing and Processing Investment Tax Credit (Jump Code: 402)*

Former Parts 2, Calculation of the non-refundable credit available for the year and available for carryforward, 4, Analysis of credit available for carryforward by year of origin and Summary and analysis of credit have been removed from the schedule as non-refundable unused credits can no longer be carry-forward.

When opening a client file prepared with a prior version of Corporate Taxprep, or rolling forward a client file, if any amount was entered on the removed lines, it will not be retained.

Schedule 404, Saskatchewan Manufacturing and Processing Profits Tax Reduction (Jump Code: 404)*

In Part 1, the section for the period before January 1, 2018, as well as the lines used to calculate the income eligible for the Saskatchewan manufacturing and processing profits tax reduction according to the number of days before 2018 and after 2017 were removed.

When opening a client file prepared with a prior version of Corporate Taxprep, if amount W was entered using an override, it will be updated to amount J and retained as an overridden value. However, if any amounts were entered on the other removed lines, they will not be retained.

Schedule 411, Saskatchewan Corporation Tax Calculation (Jump code: 411)*

The sections in respect of the calculations of the income subject to tax in Part 1 and of the Saskatchewan tax for the period before January 1, 2018 have been removed.

Manitoba

Schedule 380, Manitoba Research and Development Tax Credit (Jump Code: 380)*

Lines for eligible expenditures incurred in the current tax year before April 12, 2017, and related to credit lines, have been removed from the schedule, i.e., lines 106, 108 and 116 in Section 1, line 121 in Section 2 and lines 205 and 215 in Section 5. When opening a client file prepared with a prior version of Corporate Taxprep, if data was entered on the removed lines, it will not be retained.

Schedule 381, Manitoba Manufacturing Investment Tax Credit (Jump Code: 381)*

Lines 108, 120 and 145 relating to qualified property acquired before April 12, 2017, were removed. When opening a client file prepared with a prior version of Corporate Taxprep, if an amount was entered on one of those lines, it will not be retained.

Schedule 383, Manitoba Corporation Tax Calculation (Jump Code: 383)*

Schedule 384, Manitoba Paid Work Experience Tax Credit (Jump Code: 384)*

Schedule 387, Manitoba Small Business Venture Capital Tax Credit (Jump Code: 387)*

Schedule 388, Manitoba Film and Video Production Tax Credit (Jump Code: 388)*

A question has been added at the top of Part 10 to allow you to indicate if, throughout the taxation year of the corporation, a Manitoba production corporation owned, other than by way of security, voting shares of the corporation, and if the Manitoba production corporation received credit as a producer, co-producer or executive producer of the film. When the answer to this question is Yes and the date the principal photography began entered at line 204 is after May 31, 2020, the corporation benefits from an additional 8% rate in computing the cost of production tax credit.

Schedule 389, Manitoba Book Publishing Tax Credit (Jump Code: 389)*

Northwest Territories

Schedule 461, Northwest Territories Corporation Tax Calculation (Jump Code: 461)

As a result of the tabling of Bill 16 on October 30, 2020, which announced a decrease in the lower tax rate to 2% on January 1, 2021, line 2A in Part 2 has been split into two lines to calculate the tax at the lower rate, i.e., one for the number of days in the tax year before January 1, 2021, and one for the number of days after December 31, 2020.

Yukon

Schedule 440, Yukon Manufacturing and Processing Profits Tax Credit (Jump Code: 440)*

The lines relating to the number of days in the taxation year before July 1, 2017, have been removed from the schedule. In addition, the small business increment calculation has been modified to reflect the decrease in the increment from 0.5% to 0% as of January 1, 2021.

Schedule 442, Yukon Research and Development Tax Credit (Jump Code: 442)*

Schedule 443, Yukon Corporation Tax Calculation (Jump Code: 443)*

In Part 2, the lines that related to the calculation of the Yukon tax at the lower rate as well as the tax at the higher rate for the period before July 1, 2017 (former lines H and K) were removed. Note that the lines Total Yukon tax at the lower rate (former line J) and Total Yukon tax at the higher rate (former line M) were also removed.

When opening a client file prepared with a prior version Corporate Taxprep, if an amount was entered on one of those lines, it will not be retained.

In addition, the 2% tax rate on the income of small businesses will be eliminated as of January 1, 2021.

Newfoundland and Labrador

Schedule 307, Newfoundland and Labrador Corporation Tax Calculation (Jump Code: 307)*

In Part 2, the line that related to the calculation of the tax at the higher rate for Newfoundland and Labrador and its offshore area for the period before January 1, 2016, (former line 1) was removed as well as the line Tax at the higher rate for Newfoundland and Labrador and its offshore area (former line I).

When opening a client file prepared with a prior version of Corporate Taxprep, if an amount was entered on one of these lines, it will not be retained.

Nova Scotia

Schedule 341, Nova Scotia Corporate Tax Reduction for New Small Businesses (Jump Code: 341)*

Following the 2020 Nova Scotia Budget, tabled on February 25, 2020, a line has been added to take into account the lower corporate income tax rate, which was decreased from 3% to 2.5% on April 1, 2020.

Schedule 346, Nova Scotia Corporation Tax Calculation (Jump Code: 346)*

Following the 2020 Nova Scotia Budget, which was tabled on February 25, 2020, lines were added to Part 2 to take the following new measures into account:

• the reduction in the lower tax rate, which was decreased from 3% to 2.5% on April 1, 2020;
• the reduction in the higher tax rate, which was decreased from 16% to 14% on April 1, 2020.

Schedule 348, Additional Certificate Numbers for the Nova Scotia Digital Animation Tax Credit (Jump Code: 348)*

Prince Edward Island

Schedule 322, Prince Edward Island Corporation Tax Calculation (Jump Code: 322)*

In Part 2, line 2A.1 relating to the lower tax rate for the period prior to January 1, 2018, was removed. When opening a client file prepared with a prior version of Corporate Taxprep, if an amount was entered on this line, it will not be retained.

In addition, line 2C has been added to Part 2 and is used to calculate the tax at the lower rate for the number of days in the tax year after December 31, 2020.

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Technical Information

Technical Changes

References to Forms RC59 and RC59X Removed

References to Forms RC59 and RC59X have been removed from the program. As a result, all options relating to the RC59 and RC59X transmissions have been renamed Authorization and Cancellation respectively.

Addition of corporate information in the Open dialog box

The following information can now be reviewed in the Open dialog box when the return of a corporation is selected:

• Business number (BN);
• Return Status;
• Taxation Year End;
• Eligibility for the electronic transmission of the T2, AT1 and CO-17 returns.

Digital signature

PDF files can now be signed using the CCH iFirm Portal application. To do so, you must be subscribed to the CCH iFirm Portal application and to the Digital signature feature. Then, in the Options and Settings dialog box, go to the CCH iFirm/General section and select the Enable digital signature check box.

For further details on enabling the Digital signature feature, consult the Set Up the Digital Signature Feature article.

Once the documents are published to the CCH iFirm Portal, the Publish to CCH iFirm Portal dialog box displays. Click the button to display the list of documents for which you want to use the Digital signature feature. From this list, you will be able to invite corporations to access the portal, select documents requiring digital signature, create an envelope containing the PDF files to sign. You will also be able to view the following information:

• The name of the envelope;
• The e-mail template sent to the corporation;
• The name of the signatory or signatories who will receive the e-mail.

Once the documents are published to the CCH iFirm Portal, the signatories will receive an e-mail advising them that a document is available on the portal. They will then be able to digitally sign the document.

For further details, consult the Send Documents to Be Signed article.

In addition, an introduction video is available below:

Print to PDF – View the content of an attached file

You can now view the content of a PDF file when it is attached to a return and that return is printed to PDF. To do so, when printing to PDF, make sure to select a print format in which you can print Form All PDF files attached to the return - PDF printing only (Jump Code: PDF). A bookmark with the name of the attached file will be created in the Adobe viewer and its content will be displayed at the end of the return.

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Converting Templates

Converting Template Files

All templates (i.e. client letter templates, client filters, preparer profiles and print formats) created in a prior version must be converted to be used with Corporate Taxprep 2020 v.2.1.

Templates can be converted using the Convert function which is available in each template view.

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Corrected Calculations

The following problem has been corrected in version 2020 2.0:

General

• COVID-19 – Balance-due dates deferred to September 30, 2020 for some tax balances payable, including tax instalments, owed to the federal, Alberta and Québec governments

Federal

• COVID-19 – Balance-due day applicable to the tax balance of Parts other than Part I of the Act, including instalments payable to the federal government, extended to September 30, 2020
• T2 Return – In the first tax year of a corporation starting after 2018, the calculation of the ERDTOH on line 520 is incorrect for a CCPC that elected under subsection 89(11) ITA not to be a CCPC.

Québec

• Capital Cost Allowance (CCA) Workchart – Incorrect calculation of the amount on line E used to calculate the additional CCA of 60% for Québec for qualified property acquired after November 20, 2018

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Where to Find Help

If you have any questions regarding the installation or use of the program, there are several options for getting help. Access the Professional Centre or the Knowledge Base for tips and useful information on how to use the program. If you are in the program and need help, press F1 to get help on a specific topic.

In addition, our Knowledge Base contains an array of articles answering technical and tax questions most frequently asked to Support Centre agents. All you need to do is enter a few key words and the articles display in order of relevance to provide you with valuable information that will accurately answer your questions.

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Taxprep e-Bulletin

For your convenience, you are automatically subscribed to the Taxprep e-Bulletin, a free e-mail service that ensures you receive up-to-date information about the latest version of Corporate Taxprep. If you want to review your subscription to Taxprep e-Bulletin, visit https://wolterskluwer.ca/products/taxprep/ and, in the Existing Taxprep Customers section, click Support. In the Support menu, select Taxprep e-Bulletin. Click Newsletter Manager in the Taxprep e-Bulletin section. You can also send an e-mail to cservice@wolterskluwer.com to indicate the products for which you wish to receive general information or information on our software (Personal Taxprep, Corporate Taxprep, Taxprep for Trusts, Taxprep Forms or CCH Accountants’ Suite).

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How to Reach Us

E-mail

Customer Service:
cservice@wolterskluwer.com

Tax and Technical support:
csupport@wolterskluwer.com

Telephone

1-800-268-4522

Web Site

https://support.wolterskluwer.ca/en/support//

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