INFO-GUIDE - Taxation in PEI

The following Info-Guide is a document designed to help you navigate through the different government programs, services and regulations pertaining to specific business topics, and identify those of interest. Although most of the questions will be answered in the Info-Guide, the list is by no means exhaustive. The selected items provide a helpful overview of programs, services and regulations in a related area. This blended product of both federal and provincial information is developed to answer a growing demand for strategic information by business people. Municipal and other non-government information could be included, depending on the content and region. Further information on these programs, services and regulations can be obtained through any of the following:

• calling the telephone numbers listed under the program descriptions;
• visiting the Web sites listed under the program descriptions;
• calling the CBSC and speaking with one of the Information Agents; or
• visiting the CBSC  Web site at http://www.cbsc.org/pe 

TABLE OF CONTENTS

• Financial Assistance
  • Scientific Research and Experimental Development (SR&ED) Program
• Information Services
  • Finance and Taxation Information for Enterprises
  • Forms and Publications -- Internet Ordering Service
  • Guide for Canadian Small Businesses
  • Tables on Diskette - TOD -- Payroll Deductions
  • Income Tax Returns: T1 General
  • Income Tax Returns: the T2 Corporation Income Tax Return and the T2 Short Return
  • Prince Edward Island Revenue Sales Tax
  • Corporation Internet Filing
• Management Services
  • Business Window
  • New Employer Visits
  • Social Insurance Number (SIN)
• Regulations
  • Business Number (BN)
  • Excise Taxes and Excise Duties
  • Goods and Services Tax - GST
  • Objections and Appeals
  • Trust Accounts Division
• Canada / Prince Edward Island Business Service Centre

1. Financial Assistance

1.1   Scientific Research and Experimental Development (SR&ED) Program - Canada Revenue Agency

The federal government provides income tax incentives to Canadian taxpayers that conduct scientific research and experimental development (SR&ED) in Canada. The program encourages industry, including small business and start-up firms, to develop technologically advanced products and processes in Canada.

Claimants can apply for SR&ED investment tax credits for expenditures such as wages, materials, machinery, equipment, some overhead, and SR&ED contracts.

For further information, please call (613) 952-3881, see document  Scientific Research and Experimental Development (SR&ED;) Program or visit the Web site at http://www.cra-arc.gc.ca/newsroom/factsheets/2001/may/sred-e.html

2. Information Services

2.1   Finance and Taxation Information for Enterprises - Statistics Canada
Statistics Canada maintains financial and taxation information on incorporated enterprises operating in Canada.

For further information, please call 1-800-263-1136, see document  Finance and Taxation Information for Enterprises or visit the Web site at http://www.statcan.ca/start.html

2.2   Forms and Publications -- Internet Ordering Service - Canada Revenue Agency
If you would like to order a paper copy of one of Canada Revenue Agency's forms or publications, please complete their on-line Order form.

For further information, please call 1-800-959-2221 see document Canada Border Services Agency Forms and Publications -- Internet Ordering Service   or visit the Web site at http://www.cra-arc.gc.ca/formspubs/menu-e.html

2.3   Guide for Canadian Small Businesses - Canada Revenue Agency
This guide fosters the growth of small businesses and helps them comply with tax and customs legislation. The guide is targeted primarily at new and prospective small businesses. It provides a comprehensive overview of tax- and customs related information that established small businesses may also find useful.

For further information, please call (613) 957-8109, see document Guide for Canadian Small Businesses or visit the Web site at http://www.cra-arc.gc.ca/E/pub/tg/rc4070/rc4070eq-12.html

2.4   Tables on Diskette - TOD -- Payroll Deductions - Canada Revenue Agency
Tables on Diskette (TOD) is an electronic version of the payroll deductions tables. TOD calculates the income tax, CPP and EI contributions that Canada Revenue Agency requires an employer to withhold from an employee's income.

For further information, please call (613) 957-2778, see document Tables on Diskette - Payroll Deductions or visit the Web site at http://www.cra-arc.gc.ca/tax/business/tod/2004/wtod07-e.html

2.5   Income Tax Returns: T1 General - Canada Revenue Agency
All individuals use the T1 General return to report income and determine their income tax obligations under the laws of Canada and of all provinces and territories, except Quebec. (Quebec residents must use a separate provincial return for their provincial income taxes.)

Non-incorporated self-employed individuals can also use the T1, along with supplementary guides, to determine their personal income tax obligations.

For further information, please call 1-800-332-6022, see document Income Tax Returns - T1 General Income Tax and Benefit Return or visit the Web site at http://www.cra-arc.gc.ca/menu/EmenuLBA.html

2.6   Income Tax Returns: the T2 Corporation Income Tax Return and the T2 Short Return - Canada Revenue Agency
The T2 Corporation Income Tax Return is an eight-page return that serves as a federal and provincial/ territorial corporation income tax return.

The T2 Short is a two-page return designed for small, non-taxable corporations with a gross annual income of $500 000 or less.

For further information, please call 1-800-332-6022, see document Income Tax Returns - the T2 Corporate Income Tax Return and the T2 Short Return or visit the Web site at http://www.cra-arc.gc.ca/tax/business/topics/corporations/menu-e.html

2.7   Prince Edward Island Revenue Sales Tax
The Taxation and Property Records Division provides booklets, tax guides and business notices which assist in explaining the proper application of revenue (sales) tax, as well as responsibilities and obligations of each business in collecting and remitting the tax.  

The Taxation and Property Records Division of the Department of the Provincial Treasury is responsible for the collection of all consumption taxes levied by the province.

New businesses starting retail operations in Prince Edward Island are required to apply for a Vendor Registration Certificate.  Once the application is approved, the business is issued with a Vendor Registration Certificate which allows the business to purchase goods for resale exempt of provincial revenue (sales) tax.  The registration of the business also requires the business to collect and remit tax on sales of taxable goods.

To assist the general public and new businesses in understanding the proper application of the provincial revenue (sales) tax, a number of aids have been produced.  These include revenue tax guides and notices, which provide the necessary information on taxing goods, as well as a series of booklets dealing with revenue (sales) tax applications for specific groups.  
For more information. see:

• Contractors:  see the document Revenue Tax - Contractors
• Farmers:  see the document Revenue Tax - Farmers
• Fishermen:  see the document Revenue Tax - Fishermen
• Medical Equipment and Supplies:   see the document Revenue Tax - Medical Equipment Suppliers
• Service Stations and Garages:   see the document  Revenue Tax - Service Stations and Garages
• Vendors:   see the document Revenue Tax - Vendors

The Division also provides, upon request,  written interpretations on specific tax situations.

For further information, please call (902) 368-4070, or visit the Provincial Treasury at 95 Rochford Street, 1st Floor, Charlottetown Prince Edward Island or their Internet site at: http://www.gov.pe.ca/pt/tapr-info/index.php3

2.8  Corporation Internet Filing - Canada Revenue Agency
Corporation Internet Filing is the newest electronic tax-filing option:  it streamlines the tax-filing process, provides the filer with an immediate confirmation of receipt and results in faster refunds.

For more information, please call 1-800-959-2803, see the document Corporation Internet Filing or visit the CRA Website at http://www.cra-arc.gc.ca/eservices/tax/business/corpnet/about-e.html

3.  Management Services

3.1   Business Window - Canada Revenue Agency
Businesses can get one-stop service at Business Windows in most Canada Revenue Agency offices. Service is offered at the counter, or by telephone or fax for the four Business Number (BN) accounts (i.e. corporate income tax, import/export, payroll deductions and GST). Business Window staff can also put business clients in touch with the right contact for other Canada Revenue Agency business programs.

For further information, please call 1-800-959-5525, see document Business Window or visit the Web site at http://www.cra-arc.gc.ca/E/pub/tg/rc4070/rc4070eq-11.html

3.2   New Employer Visits - Canada Revenue Agency
Personalized visits to new employers help them to understand withholding procedures and to solve any source deduction problems they may have.

For further information, see document New Employer Visits or please call 1-800-959-5525. The program is also detailed in the Employer's Guide - Payroll Deductions available on the CRA website at http://www.cra-arc.gc.ca/E/pub/tg/t4001/README.html

3.3   Social Insurance Number (SIN) - Human Resources and Skills Development Canada
The Social Insurance Registration Program was developed to register people for two federal government programs, namely, Employment Insurance (EI) and Canada Pension Plan (CPP).

For further information, please contact your local Human Resources and Skills Devleopment Canada listed in the blue pages of your telephone directory, under Government of Canada, or see the document Social Insurance Number - SIN.

4. Regulations

4.1   Business Number (BN) - Canada Revenue Agency
The Business Number (BN) replaces the many numbers businesses need to deal with government, thus helping reduce costs and increase competitiveness. The BN increases government efficiency and helps it deliver one-stop service at Business Windows. This program contains information about which accounts a business may need and how to complete a request for a Business Number.

For further information, please call 1-800-959-5525, see document Business Number - BN or visit the Web site at http://www.cra-arc.gc.ca/formspubs/topics/bn-e.html

4.2   Excise Taxes and Excise Duties - Canada Revenue Agency
When goods are manufactured in Canada, excise tax is payable at the time the goods are delivered to the purchaser. When goods are imported, excise tax is payable by the importer, at the time the goods are imported.

Excise duties are charged on spirits, beer, and tobacco products manufactured in Canada. The Excise Act sets out the rates of duty for these goods.  

For further information, please call (902) 426-5748, see document   Excise Taxes and Excise Duties or visit the Web site at http://www.cra-arc.gc.ca/formspubs/topics/excise_tax-e.html

4.3   Goods and Services Tax - GST - Canada Revenue Agency
The goods and services tax (GST) is a multi-stage tax that applies to most transactions throughout the production and marketing process.

For further information, please call 1-800-959-5525, see document Goods and Services Tax and Harmonized Sales Tax - GST/HST or visit the Web site at http://www.cra-arc.gc.ca/menu/GTGD-e.html

4.4   Objections and Appeals - Canada Revenue Agency
The Income Tax Act and the Excise Tax Act allow taxpayers to formally dispute a tax assessment. Canada Revenue Agency aappeals officers then impartially review the assessment.

For further information, please call 1-800-561-9362 see document Objections and Appeals - Income Tax Act/Excise Tax Act or visit the Web site at http://www.cra-arc.gc.ca/E/pub/gm/31-0/README.html.

4.5   Trust Accounts Division - Canada Revenue Agency
The Trust Accounts Division works to ensure that employers and workers meet the withholding, remitting and reporting requirements of theIncome Tax Act, the Canada Pension Plan, the  Employment Insurance Act., and the Excise Tax Act.

It also ensures they meet the requirements for provincial tax withheld at source, for all provinces except Quebec.

For further information, please call 1-800-959-5525, see document Trust Accounts Division or visit the Web site at http://www.cra-arc.gc.ca/tax/business/topics/payroll/menu-e.html

5.  Canada / Prince Edward Island Business Service Centre

The Canada / Prince Edward Island Business Service Centre is an innovative partnership of federal and provincial government departments.  Both levels of government work with key private-sector organizations to support business start-ups, modernization and growth in Prince Edward Island.

The Canada / Prince Edward Island Business Service Centre is accessible province-wide and free of charge.  You may reach us through our toll-free number or visit us with your questions.  Our office is open from 8:30 a.m. to 4:30 p.m., Monday to Friday.  We also provide a 24-hour business information service, seven days a week, through our Internet site.

Canada / Prince Edward Island Business Service Centre
75 Fitzroy Street, Charlottetown, PEI.   C1A 7K2
Telephone:  (902) 368-0771 or 1- 800-668-1010
Fax:  (902) 566-7377
Internet site:  http://www.cbsc.org/pe
E-mail: pei@cbsc.ic.gc.ca

DISCLAIMER
Information contained in this document is of a general nature only and is not intended to constitute advice for any specific fact situation. Users concerned about the reliability of the information should consult directly with the source, or seek legal counsel.

Links Policy
Some of the hypertext links lead to non-federal government sites which are not subject to the Official Languages Act and the material is available in one language only.