T1198 (Assorted Topics)

Your reading the very basic , very basic paragraph. The notional interest on tax payable using the form 1198 is very clear and precise, just google it, it's in very very plain site. Some of us don't want to believe and I can understand that totally

You are welcome Sapper. This is the thing that I think will hurt us the most. Those of us who received a large sum of interest from our retro, we will get nailed hard with this T5, they did not take any taxes from our interest portion of our retro. So all I can say is be prepared to take a big hit on that.

Navrat, the person who told you that is full of shit, or that person does not know how to read, maybe both, read it yourself it is straight forward. Next time you call the hotline ask to speak to and agent who specializes in Lump sum payments / T1198.

Anyway everyone will file soon and hopefully it works out in everyone's favor. When the withholding tax on our retro was 30 percent and some of us got over a couple hundred thousand of course there will be amounts owing. I am lucky I live in a province where the tax rate is on the lower end, Quebec and the eastern provinces have a much higher rate

Oh Crap...sphincter doing push-ups now...Sept 07 1989...Oct 08 2013...hopefully I didn't owe much tax as my income was for a one hook sapper...but sheesh. Brutal if true.
Sap

The charge is a percentage of the tax on the retro you get charged, say the tax is 5000 you owe because of the retro in year one going back, the interest is 10 percent, so for that year you owe 5000 plus the 500 interest . So 5500 hundred for that one year, call and ask if you use the form 1198 is there any extra interest on the tax owing for those years and they should give you an answer

Ive talked to the CRA hotline and they confirm it, they don't call it that, it's an interest charge because the government never got the money in those prior years, I don't know what else to say?

Thanks for the challenge question Trooper. I can't see how we would be penalized as we don't get re-assessed on taxes, simply pay the taxes we should have in the year we should have received the income. So for those of us with little to no taxable income in those years...we should be ok. Personally, I have no taxable military pension, only cpp d, so I should be fine. Living on very little ( way under the poverty line) for those two decades should make it ok for me. Thanks for the post.
Sap

We will not reassess your returns for prior years to include this income. However, you can ask us to tax the parts for the
prior years as if you received them in those years. You have to include the whole payment on the appropriate line of your return for the year.

This is directly from the T1198 form ( no reassessment ) In order to impose any type of penalty and or deemed taxes on and individual, you must do a reassessment of the individuals taxes.

This is why I would challenge anyone to show me in writing where it states that you will be penalized for submitting the T1198.

Navrat, you stated that if you submit the T1198 they would take $11000 off, therefore how can that be if you also stated that they will charge you DEEMED TAX on submitting the T1198 form ? What have I missed here ? Where does it state that by submitting the T1198 form you will be charged DEEMED TAXES ?

Yep, I'm throwing the iPad aside, with my Ufile program tax information on it and heading down to the watering hole? At least there's fish dinner on tonight, lol

The T1198 will be filled out by Manulife, we should start to receive them towards the end of this Month.
The T4's and T5's should be sent out around the same time.
Take note that no taxes were withheld for the interest part of our retro's, that is why we are going to receive the T5.

Of course Navrat. You are tax-scrambling your brain man. Walk away from the tax program and get to your stool at the Hammer Legion for a beer! LOL

Will we get another T4A for the monthly ltd?

Manulife tax forms
Feb 6, 2014

We would like to pass along the following information from Manulife regarding tax forms for class members.

Class members will receive two tax forms from Manulife’s Waterloo office. The two forms are the T4A and T5. The T4A is being issued for the gross offset and tax gross up portion of the refund. The T5 is being issued for the interest portion of the refund. These forms will most likely arrive in separate envelopes.

Some members will also receive a T1198 form (Statement of Qualifying Retroactive Lump-Sum Payment) from Manulife’s Halifax office. If a member’s refund is over $3,000, a T1198 form will be sent to the member. For Quebec class members, a TP766.2 form will be sent if the refund is over $300.

If you have not received your tax forms by mid-March, or if you have any questions regarding these tax forms, please contact Manulife directly at 1-855-370-0025.

SISIP Class Action Team

My accountant actually worked for Rev Cda for 32 years and his MOTTO is one I like:
For 32 years my job was to f you on behalf of the govt, now my job is to f the govt on behalf of you!
And he knows some pretty sweet in's and outs.
Unfortunately he is sitting on a beach getting high and drinking rum right now. I say unfortunately because I am not there