Navigating Tax Law Changes in Canada and the U.S.

2025 brings with it several pivotal tax changes in both Canada and the United States—each with wide-ranging implications for individuals and businesses.

In Canada, the federal government has introduced a higher capital gains inclusion rate for corporations and high-net-worth individuals, sparking debate and calls for clarification on transitional rules.

Meanwhile, the U.S. Congress passed a bipartisan tax reform package focused on middle-class relief and green energy incentives. However, corporate tax deductions for interest payments have been scaled back.

Cross-border businesses are particularly affected. Tax treaties, reporting obligations, and the implementation of the OECD’s global minimum tax are causing CFOs to re-evaluate tax strategy.

For individuals, both countries are tightening rules on tax shelters and foreign income declarations, meaning more scrutiny and potential penalties.

Tax professionals recommend proactive compliance planning, updated estate strategies, and keeping close tabs on provincial or state-level nuances.