Alberta
Income Tax Refund for Individuals and Trusts Individuals and trusts file their Alberta personal income tax and credit returns (federal form AB428) and trust returns (federal form T3AB) with the Canada Revenue Agency (CRA). These taxpayers pay their Alberta income tax to CRA based on the federal resource tax rules. The Alberta program provides a refund of any income tax paid to CRA greater than the amount payable if the Alberta resource tax rules had been followed. For more information, see page 2 of Special Notice Vol. 5 No.18,
"Alberta Response to Federal Resource Tax Changes". Refunds will be added to claims made under the Royalty Credit for Individuals and Trusts (RCIT) program.
Completing the Application Form for the RCIT and Tax Refunds Complete the identification portion of the AT60 application form. Complete section A and page 2 of the AT60 form to apply for the RCIT. You may qualify for a Resource Allowance Tax Refund and/or a refund of the Alberta personal income tax you paid on the RCIT you received and included in your taxable income for the year. Section B of the AT60 form – Part 11 Alberta Tax Refunds, contains both tax refunds combined. To calculate each refund complete the attached Schedule for Calculating the Alberta Tax Refunds (AT245). NOTE: Complete form AT245 before completing Section B of the AT60 form. The AT245 form also requires information from your Alberta income tax return. Please complete your Alberta income tax return for submission to CRA before completing and filing your RCIT and income tax refund claim with Alberta Finance, Tax and Revenue Administration.
Area 1 - Resource Allowance Tax Refund The Government of Canada is phasing out the deductibility of resource allowance as follows: 90 per cent deductible in 2003, 75 per cent in 2004, 65 per cent in 2005, 35 per cent in 2006 and 0 per cent after 2006. Deductibility of crown charges for federal tax purposes is being phased in at 10 per cent in 2003, 25 per cent in 2004, 35 per cent in 2005, 65 per cent in 2006 and 100 per cent after 2006. During the transition period, the Alberta Government will continue to allow full deductibility of the resource allowance until December 31, 2006. Full deductibility of crown charges greater than the resource allowance will be maintained through the existing Alberta Royalty Tax Rebate program. (The amount is calculated on federal form T79 and deducted from either: • Alberta personal income tax using the amount on line 51 of the 2005 Alberta Tax and Credits return AB428, or • Alberta tax on trust, using the amount on line 20 of the 2005 T3AB trust return.) To complete this form, start with the resource allowance amount you deducted in calculating income on your personal income tax return (T1) or trust tax return (T3). (This is the amount you included in the Alberta taxable income on the Alberta Tax and Credit return [federal form AB428] or the Alberta trust return [federal form T3AB] filed with CRA for the year. AT245 Line 10 At line 10, enter the entire (100 per cent) of the resource allowance amount you deducted in calculating income on your personal income tax return (T1) or trust tax return (T3) filed with CRA, even if you claimed a lesser amount federally. (Calculation of the resource allowance is normally available from the federal Schedule 51, “Calculation of Adjusted Resource Profits, Resource Loss, and Resource Allowance”.) AT245 Line 11 On line 11, enter 100 per cent of crown charges, even though you may have included less than the full amount of the crown charges in your calculation of income on your personal (T1) or trust (T3) tax return filed with CRA. ( The crown charges can usually be calculated by adding boxes 090 and 091 from federal schedule 51.) AT245 Line 12 On line 12, enter the actual amount of crown charges you included in income on your personal income (T1) or trust (T3) tax return filed with CRA.
AT245 Line 16 Enter the actual resource allowance amount you deducted from income on your personal income tax return (T1) or trust tax return (T3) filed with CRA. AT245 Line 17 Calculate the difference between the additional resource allowance you may claim under the Alberta system minus the amount of the crown charges you did not include in your income as allowed under the Alberta system. Enter this amount on Line 17. AT245 Line 18 On line 18, enter 10 per cent of the amount on line 17. This is the maximum additional amount of Alberta income tax that you may have paid to CRA due to the federal phase-out of the resource allowance and the phase-in of the deductibility of crown charges. Area 2 - Refund of Alberta Income Tax on Royalty Credit for Individuals (including Trusts and Estates) The Government of Canada began to tax the RCIT on January 1, 2003, annually increasing the taxable percentages. The Alberta Government is maintaining its policy of not taxing the RCIT. AT245 Line 20 On line 20, enter the amount of the RCIT you received in the year and included in income on your personal income (T1) or trust (T3) tax return. (This is the amount you included in the Alberta taxable income on the Alberta Tax and Credit return [federal form AB428] or the Alberta trust return [federal form T3AB] filed with CRA for the year.)
AT245 Line 22 Enter on line 22, 10 per cent of the amount on line 20. (This is the maximum additional amount of Alberta income tax that you may have paid to CRA on RCIT benefits taxed federally.) AT245 Line 34 Add line 30 and line 32 to obtain the maximum Alberta income tax refund to which you may be entitled. AT 245 Line 38 Your tax refund is the lesser of the maximum amount available at line 34 or line 36 (Alberta personal tax payable at 2005 federal form AB428 line 51 or Alberta trust tax payable at 2005 federal form T3AB line 22.) Enter the amount from AT245 line 38 on AT60 line 18.
|
|
|
