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TaxCycle 10.0.41387.0—T2 and AT1 (Revised)

In this TaxCycle release, T2 and AT1 are certified to support tax year ends up to May 31, 2021.

Get this version as an automatic update, full download from our website or a free trial. (To deploy auto-update files from your network, see the Auto-Update Files page.)

Release Highlights

Revisions

December 11, 2020—We released an update with the following changes since version 10.0.41290.0:

  • Per the Saskatchewan Bill 2 (first reading) issued on December 7, 2020, a temporary reduction to the Saskatchewan small business corporate income tax rate from 2% to 0%, effective October 1, 2020, until June 30, 2022. This updates the calculation for T2 Schedule 411.
  • Known Issue: T2 S100 Out-of-balance Review Message. The rounding of imported values will not automatically correct itself after installing this release. Please either re-import the GIFI data, or follow the workaround in the known issue.
  • Known Issue: Error Generating T1135 XML
  • Rate correction in Section 2 of T2 Schedule 502, from 3.5% to the correct rate of 1.5%.
  • A crash occurred when selecting a pay period other than monthly on the PD27, in TaxCycle T4

T2 and AT1 Filing Date Extension

TaxCycle supports the preparation and filing of federal T2 and Alberta AT1 corporate tax returns with tax year ends up until May 31, 2021.

New T2 Forms

  • Schedule 43 Calculation of Parts IV.1 and VI.1 Taxes
  • Schedule 45 Agreement Respecting Liability for Part VI.1 Tax
  • Schedule 58 Canadian Journalism Labour Tax Credit. The Canadian Journalism Labour Tax Credit is automatically reported on line 798 of the T2 return.
  • Schedule 349 Nova Scotia Innovation Equity Tax Credit. In the previous release, Schedule 349 was added as a worksheet. This release replaces the worksheet with the latest version of the official CRA form.
  • Schedule 350 Nova Scotia Venture Capital Tax Credit. In the previous release, Schedule 350 was added as a worksheet. This release replaces the worksheet with the latest version of the official CRA form.
  • Schedule 440 Yukon Manufacturing and Processing Profits Tax Credit. The Yukon manufacturing and processing profits tax credit is automatically reported on line 677 of the Schedule 5.
  • CO-17.CE (QC88) Internet business activities
    • The first 5 rows of website information must be filled out from federal Schedule 88.
    • The information about the additional websites (in excess of five websites) must be entered directly in CO-17.CE.
  • QC28 Election not to be associated through a third corporation. QC28 is automatically completed from data entered on federal Schedule 28.
  • Customer Request TP-1086.R.23.12 Costs incurred for work on an immovable.
  • CO-156.EN Agreement Concerning Regional Ceilings Respecting the Additional Deduction for Transportation Costs of Small and Medium-Sized Manufacturing Businesses.
  • CO-156.TR Additional Deduction for Transporting Costs of Small and Medium-Sized Manufacturing Businesses. The amounts for lines 10, 11, 13 and 14 in section 2 flow from Schedule 27 lines 150, 170, 140 and 160, respectively.

Updated T2 Forms

Minor revisions unless otherwise detailed below.

  • Engagement worksheet. Moved the GST/HST Access Code field from the Info worksheet to the “Other Engagements” section on the Engagement worksheet.
  • T183Corp. Removed the line "Part II surtax payable (line 708)" in Part 2.
  • Schedule 200 (T2 Jacket). Added new check box 272 for Schedule 58.
  • Schedule 2.
  • Schedule 5 (British Columbia). Added new line 883.
  • Schedule 5 (Manitoba).
    • Removed lines 324 (Manitoba data processing investment tax credit) and 325 (Manitoba nutrient management tax credit).
    • Removed line 603 for non-refundable Manitoba paid work experience tax credit (from Schedule 384).
  • Schedule 5 (New Brunswick). Removed lines 575 and 894 with respect to political contributions.
  • Schedule 5 (Ontario).
    • Removed line 464 related to Schedule 562 which was also removed.
    • Added new line 472 (Ontario regional opportunities investment tax credit).
  • Schedule 5 (Saskatchewan)
    • Removed line 630 (Saskatchewan manufacturing and processing investment tax credit), from Schedule 402).
    • The June 15, 2020 budget introduced a new Saskatchewan Chemical Fertilizer Incentive (non-refundable tax credit) that provides a 15% tax credit to encourage new investment to grow Saskatchewan’s value-added sector. A new unnumbered field below line 631 was added to the Saskatchewan section of Schedule 5. For further information, please refer to the Saskatchewan news items 2020-21 Budget Supports People, Jobs and Economic Recovery and Saskatchewan Chemical Fertilizer Incentive Launched.
  • Schedule 12.
  • Schedule 16.
  • Schedule 25.
  • Schedule 21. Removed the lines Additional deduction for credit unions (line 628) in Part 7 and Part 8.
  • Schedule 50. Added a new column to allow a Partnership Account Number if a partnership is a shareholder of the corporation.
  • Schedule 54.
  • Schedule 71.
  • Schedule 72.
  • Schedule 73.
  • Schedule 8.
    • Added a section 1 for contact information.
    • Added a column 262 to the Section B table.
    • Removed column 280 from the Section B table.
  • Schedule 341 (Nova Scotia).
  • Schedule 380 (Manitoba). Removed lines related to expenditures incurred before April 12, 2017.
  • Schedule 381 (Manitoba). Removed fields related to expenditures incurred prior to April 12, 2017.
  • Schedule 384 (Manitoba). Removed parts 9 and 10 related to non-refundable credits as they are no longer applicable; also removed the corresponding line 603 from Schedule 5.
  • Schedule 402 (Saskatchewan) Removed the section related to non-refundable tax credits as it is no longer applicable.
  • Schedule 422/T1196 (British Columbia).
  • Schedule 423/T1197 (British Columbia).
  • Schedule 428 (British Columbia).
  • Schedule 442 (Yukon).
  • Schedule 500 (Ontario).
  • Schedule 502 (Ontario). Added Part 5, “Adjusted crown royalties”; it was previously Part 3 of Schedule 504.
  • Schedule 504 (Ontario).
    • Form name changed to “Ontario Resource Tax Credit.”
    • Part 3 “Adjusted crown royalties” moved to Schedule 502 as new Part 5.
    • Removed line 125 of expired amount.
  • Schedule 558 (Ontario). Removed sections related to expenditures incurred before April 24, 2015.
  • Schedule 562 (Ontario). Form no longer applicable. Entire form removed along with corresponding line 464 on Schedule 5.
  • Schedule 570 (Ontario). Based on the latest draft Schedule 570, added this schedule as a worksheet to support Ontario regional opportunities investment tax credit and added the calculation of new line 472 to Schedule 5.
  • AT1 Jacket.
  • AT1 Schedule 1
  • AT1 Schedule 21. Changed the limited partnership table column 131 to an edit field where you must manually enter a partnership.

Updates to SR&ED Forms

  • T661
    • Removed lines related to capital expenditure (lines 350 and 355).
    • Added a new overhead amount column 758 to the table in Part 6.
  • Schedule 60
    • In Part 2, added a new column to calculate the overhead amount. The amount entered flows into column 758 in Part 6 of the T661.
    • For the purposes of Part 5 table column A, added 2021 maximum pensionable earnings of $61,600.
  • Schedule 61 (T1145). Removed lines 015 and 020.
  • Schedule 62 (T1146). Removed lines 015 and 020.

T1134

The CRA has introduced a new version of T1134 Summary and Supplements. This new version must be used if the taxpayer’s taxation year begins in 2021 or later and offers a new reporting option to file one set of T1134 for a group of related reporting entities.

  • For tax years that begin in 2020, form T1134 must be filed within 12 months of the end of the reporting taxpayer’s tax year. 
  • For tax years that begin after 2020, form T1134 must be filed within 10 months of the end of the reporting taxpayer’s tax year.
  • In all other cases, form T1134 must be filed within 15 months of the end of the reporting taxpayer’s tax year. The T2 client letter has been revised accordingly.

In this new version, reporting entities that are members of a related group have the option of filing one set of T1134 Summary and T1134 Supplements in respect of all foreign affiliates for which any one of its members would have otherwise been required to file T1134 returns. Please review the T1134 help topic for details.

The T2 Client Letter now displays the T1134 filing date based on the new filing requirements.

Customer Requests

PD27 Temporary Wage Subsidy Self-identification Form for Employers (in TaxCycle T4).

  • Changed to multi-copy form to allow for one copy for each payroll account.
  • Added an option to transfer from the worksheet if the payroll frequency is monthly.

Addition of keyboard shortcuts for review marks to ease in the transition from Taxprep.

  • Alt+1 First review mark
  • Alt+2 Second review mark
  • Alt+3 Correction
  • Alt+4 Question
  • Alt+0 Clear review marks

T4 2020—Updated the T4 slip and T4 Summary to the new versions released by the Canada Revenue Agency (CRA) on October 21st. The 2020 version of the T4 slip includes four new Other information codes, 57 to 60, for reporting employment income paid to employees during four specific periods in 2020 which the CRA will use to validate various COVID benefits paid in 2020.

Note: CRA’s slip internet filing system will not be updated until January 2021 to accept amounts for these four codes. If you intend to internet file the return, a message will appear in TaxCycle when amounts are entered for these codes to inform you of this situation. This does not affect T4 slips mailed to the CRA.

T3010—Added the MR-69, Authorization to Communicate Information or Power of Attorney, to TaxCycle T3010 module. It can either be mailed or filed electronically to Revenu Québec for processing.

Resolved Issues

  • T1—Resolved an issue where a review message about blank rows on the T657 displayed when not required (as reported on protaxcommunity.com).
  • Sage Accounting GIFI import (T2 and T5013)—Changed the import for certain GIFI codes to display as positive instead of negative. 
  • T5013—Changed rounding on GIFI values imported to round to the nearest cent instead of the nearest dollar.

T2 Schedule 8 class 14.1 CCA calculation in a pooled scenario

If the capital cost allowance (CCA) for a class 14.1 asset (eligible capital property before January 1, 2017) for the year is less than $500, ITA Regulation 1100(1)(c.1)(ii) allows you to bump up the CCA for the year to $500.

Prior to this release, if a pooled class 14.1 contained both pre-2017 and post-2016 UCC balances, TaxCycle T2 incorrectly applied $500 of the CCA to reduce only the pre-2017 balance. Under the ITA Regulation 1100(1)(c.1)(ii), $500 of CCA must be applied to reduce UCC balances in the following order:

  1. Pre-2017 UCC balance up to 7% CCA.
  2. Post-2016 UCC balance up to 5% CCA.
  3. Pre-2017 UCC balance up to remaining UCC.
  4. Post-2016 UCC balance up to remaining UCC.

TaxCycle T2 now applies pre-2017 and post-2016 UCC balances in the correct order.

Updated TaxCycle Software License

We recently updated the TaxCycle Software License agreement. These updates are effective immediately. Upon installation of this TaxCycle release, you will be agreeing to the new terms in the license agreements. Please take the time to review the full legal documents here: TaxCycle Software License