Musquie

Fishing income not recognized on T2121 & CPP Exempt issue

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2 issues:

1- Receiving warning "The amount kin box 78 of the T4 slip must also be reported as business income".  I added this to T2121 form box entitled "Fisher's Gross income (income from T4 Box 78)..." however, I am still getting the same warning when I review the return.

2- Also, I checked CPP exempt on 2 T4's but the software  is still calculating CPP contribution amount and an amount owed for CPP.

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Hello Musquie,

T4 slip - Box 78 - Fishers - Gross income

Fishermen are subject to different tax rules, and are considered self-employed. However, they can request that the tax be withheld on the sale of their catch as they can contribute to Employment Insurance.

We suggest that you refer to the following links from the CRA's website:


https://www.canada.ca/en/revenue-agency/services/forms-publications/publications/t4005-fishers-employment-insurance.html


You have received a T4 slip with an amount displayed in Box 78 for gross income earned as a fisherman.

To report this amount, you must follow these steps:


1. In the "Left-side menu under the Interview tab", click on "T4 and employment income".


2. On the right-hand side of the screen, select "T4 income (earned in any province except Quebec)", or "T4 and RL-1 (Relevé 1) income earned in Quebec" enter the information shown on your T4 in the appropriate boxes, namely boxes 16 and 24, as well as boxes 55 and 56 for Quebec residents.


3. Go to the bottom of the "T4 slip income" page, and in the last section titled "Other information (click on the triangle to see the list of choices)", choose "Memo Box 78 Fishers gross earnings" from the drop-down menu and enter the amount in the field.

Once you have followed the steps above, you must also enter the amount in box 78 of the T4 as business income. In order to do so, please follow these steps:

1. Return to the "Left-side menu under the Interview tab" and select "Interview setup". On the right-hand side of the screen, go to the "Self-employment" group, and check "Self-employed business income". Also, if you have paid installments, go to the "Tax paid by instalments" group, check "Tax paid by instalments, tax transfer for resident of Quebec" and click "Next" at the bottom of this page.


2. Return once again to the "Left-side menu under the Interview tab", select the line "Self-employment income" and on the right side of the screen chooses "T2125 - Business income".


3. On the "Fishing business identification" page, enter your full name on the line "Name of the fishing business" and enter the other mandatory information in the sections marked with a red asterisk.


4. For the line "6-digit code from the North American industry classification system", enter the code that best describes your industry. If you do not know the code, click on the help button (?) located on the right side of the box to access a list of the codes.


5. In "Income, expenses", enter the amount in Box 78 on the line for "Fishers - Gross income (Income from T4 Box 78) (Enter the total if you have more than one amount)" located under the section "Sharesmen (boat and captain)". If you have any expenses related to this income, fill out the boxes according to each description.

The amount will be carried over to line 143 of the federal return and, if applicable, to line 164 of the Quebec return, as well as line 24 of Quebec Schedule L. The program will also generate federal form T2121 as well as T2121 (Q) for residents of Quebec.

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Antoine7 -can you correct/clarify #2 in part 2 above when you say "T2125" ...shouldn't this be "T2121" ??  ....there are no options for fishing income on T2125 (I checked in case your software works in ways other's don't...but maybe i missed something odd here?)

I followed your steps above precisely and the program will NOT allow you to NETFILE.  After spending more than 2 hours doing every single possible combination between the T4 -box 78 footnote and the 2 boxes on T2121 for "Sharesperson income" and Box 78 Fisher's Gross Income, the ONLY way netfile ability comes up as acceptable is if I put the income in BOTH rows/fields on T2121, BUT it doubles up the income which is incorrect obviously.  The T2121 is filled out properly and tax and CPP on this self employment income is calculated accurately (ie: in 'Review' and 'Tax Return' statuses) when I put the amount in JUST the "Sharesperson income" row (and leave the box 78 row blank), so why is your program coming up with a NETFILE error when nothing is wrong?? Super frustrating! 

The error showing is "The amount in box 78 of the T4 slip must be entered within a T4 footnote and as a T2121 fishing business income."   IT IS!!!!!!!!!!!!!!!!!!!        yes, after another 1.5hrs re-playing scenarios, deleting and re-inputting, trying the T2121 first, then putting in a new T4, etc etc etc, still no luck, i'm beyond frustrated at something so simple. 

..and yes, i have the latest software update (as of April 2, 2018).  PLEASE HELP ASAP

 

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