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QRLSP is not Rumors, you will most likely be offered 2 ways to file your taxes. 1. all in the year received or 2. Ask CRA to use QRLSP calculations. CRA will not call, the Deemed tax portion, of your past tax years as (Penalties or Interest) But the Deemed tax, is most likely calculated similar, if not in line, with CRAs penalty and Interest calculations. This is not a Rumor lol.

There will be no tax penalty. The only way you can be hit with a tax penalty is next year if you don't file this year.

Think about it for a second people...how can they penalize us if we were not going to get it until this year?

If you are going to spread rumors at least spread good ones like Navrat. Then again no one, and I mean no one, can spread a good rumor like Nav. Especially when he has a VAC employee in his corner because we all know VAC employees know everything

Hi. With regards to the Tax information Bigrex has researched, I can comment a bit on this, as I have had retro payments from 2002 back to 1990, and went thru the tax hell. QRLSP Legislation allows for your (Qualifying Retroactive Lump-Sum Payments), to be spread out over past years. I went to the tax court of Canada over how unfair i was treated on these calculations as CRA adds Deemed Taxes, and did not allow me to use RRSP or other tax shelter room in those past years. With regards to the form RC4288 I have a feeling that that may be Fairness provisions which i tried back then to apply for but CRA turned me down as they said it was just in place to waive (Interest and Penalties) Catch 22 in my case was CRA viewed the Deemed taxes to be Notional Taxes. (Not Interest or Penalties). I highly advise that you reseach the QRLSP Legislation, and any past court cases to see where you stand in regards to QRLSP payments. Bigrex Bud. CRA is not your friend, and when the smoke clears 1 or 2 years from now, and you have filed your returns, get ready for a big punch in the gut as I did, unless our great lawyer team has been prepared for us well, in the up comming tax issues.

. I don't think this is the tax situation that applies in this situation... you filed your taxes on time and with the correct information as it stood at the time. There is a section for "qualifying retroactive lump-sum payments" that applies... I don't know that much about it except there are extra "deemed taxes" added that are significant... Someone else had a example in an earlier post, but I can't remember which one. I think that the extra tax added (which probably represent interest and penalties) are what is covered by the notional top-up they are talking about. I think it is part of what is sent to Revenue Canada by SISIP and we won't see it as cash.

This is just my understanding of the tax situation... Whoever had the example earlier.. please correct me if I am wrong in any way.

What is national top up?

Say you were getting back 2 year which say its 25.000.00 so you get 35,000.00

And what about someone that getting back 10 years say its 125.000.00 so you get 135,000.00 ????????????

I just read the CRA website about penalties, and here is what it says

"Late-filing penalty

If you owe tax for 2011 and do not file your return for 2011 on time, we will charge you a late-filing penalty. The penalty is 5% of your 2011 balance owing, plus 1% of your balance owing for each full month that your return is late, to a maximum of 12 months.

If we charged a late-filing penalty on your return for 2008, 2009, or 2010 your late-filing penalty for 2011 may be 10% of your 2011 balance owing, plus 2% of your 2011 balance owing for each full month that your return is late, to a maximum of 20 months.

We may waive or cancel this penalty as well as any interest that may apply if you file your return late because of circumstances beyond your control. If this happens, complete Form RC4288, Request for Taxpayer Relief, and mail it to the intake centre responsible for your province or territory of residence.

Only requests relating to tax years ending in any of the 10 calendar years before the year in which you make the request will be considered. For example, a request made in 2012 must relate to the 2002 or a later tax year to be considered. For more information, see Information Circular IC07-1, Taxpayer Relief Provisions.

Ya, that's the way is looking, this whole tax issue is a killer, I hope I am wrong with that rumour and there is some sort of damage because the way you worked it out, which is correct, feels like a kick in the gut

Well since only special or aggravated damages are exempt tax, by calling it a notional top up,v it will be taxed, and since it would be part of the settlement, it would be included in the calculation of the legal fees. So it would look like this:

Retro owed + interest + top up = settlement
Settlement - legal fees - 15% HST apparently (for NS residence) = actual award
Actual award - Federal and provincial taxes = Net award

So say if someones settlement is $350000 after interest and the top up, and live in NS. If they do only ask 10% legal, there goes $35000. minus 15% of that amount, so another $5250 for HST. That leaves $309750 to be taxed. Now the options are to divide that amount over the time period that it would have been earned and pay a whack of penalties, or tax it as a lump sum. The latter option would leave just under $177000, or 50%.

Punch in 30% for legal and the final settlement drops to $136475 net, or 39%

So either way, unless part of the settlement is exempt taxes, or the penalties are waived if we split it for past years, we are going to take a major hit.

now would the notional topup be subjected to legal fees? Would it be taxed? Or would our original amount be taxed at X - legal fees, or would it be X + notional topup - legal fees?

Lol, it's no better here, I expect a flood of new taxes to hit us, plus our doctor situation is crazy, your lucky to get a family doctor, all manufacturing gone, it kind of reminds me of England, thin layer of rich at the top and 80 percent scrambling to make ends meet

I am moving to Ontario

Jack sailor,you will come out ahead, there are over 200 zero sums that were at our three legions, and a hundred thousand rumours, and yes this is a rumour but and I say but, the guy would told me is not your typical rumour mill type, He actually works for VAC at the Hamilton district office, not my cm , but someone who would have to face a bunch of angry veterans if he was BS. They knew there was a big trouble brewing with the 30 percent figure circulating in the veteran community , so like Dennis also said, legal fees are very very reasonable, so 10 percent is a number I believe is close , actually hope is close. I hope this rumour has some truths , not the 2001 cut off date, but everything else is not bad. And for the record , I believe we should split the NS HST among all the veterans getting retro because you can't help what province you live in, and it's unfair in this case, to single out one group of class action clients

,

I actually didnt notice ! bigrex

My rumor -
They owe me $13000.00
minus 30%- Legal
minus 40% Taxes
minus15% Hst

Happy Meal at MacDonald for me and my gang!
Coffee refills are free! TY Ronald
Broke!

As far as the rumour itself, it isn't bad, except the retro only going back to 2001 (doesn't affect me, but it would leave far to many Veterans affected out in the cold). and the notional top up, if it is only to cover tax penalties.