Each week I pull together the accounting, tax, and AI news that matters most to small business owners and individuals in Canada and the US, in plain English, with links to the original sources. Here is what happened in the week of October 12, 2026.
Canada
1. CRA clarifies who must file under the bare trust rules
On October 5, the CRA expanded its FAQ on the enhanced trust and bare trust reporting rules, adding examples of common situations that are not treated as trusts, such as a joint bank account held by family members, a parent added to a home title so a child can get a mortgage, and a family home where only one spouse is on title. The CRA also confirmed that its earlier administrative filing exemptions for bare trusts no longer apply for tax years ending on or after December 31, 2026. If you hold property on behalf of someone else, now is the time to check whether a T3 filing will be due in 2027.
Source: Tax Interpretations: CRA expands its FAQ webpage on bare trust reporting
2. Updated SR&ED tax credit policy reflects bigger limits
The CRA updated its SR&ED investment tax credit policy on October 7 to reflect recent legislative changes. Highlights include capital expenditures once again qualifying for SR&ED, and an expenditure limit of $6 million for Canadian-controlled private corporations (for tax years beginning after December 15, 2024), with the phase-out now starting at $15 million of taxable capital. If your company develops new products or processes, the enhanced 35% refundable credit may now cover more of your spending.
Source: Tax Interpretations: CRA updates its SR&ED ITC policy
3. Taxpayers' Ombudsperson raises concerns about automatic "deemed filing"
On October 5, the Taxpayers' Ombudsperson asked the House of Commons Finance Committee to take a closer look at Bill C-31, which would let the CRA file returns for certain low-income individuals without their involvement. The Ombudsperson warned that the proposal sets no firm notification dates and could interrupt benefits, and recommended prioritizing pre-filled returns in CRA My Account, expected to launch in March 2027. If you help family members who rarely file, keep an eye on how this develops.
Source: Office of the Taxpayers' Ombudsperson via Cision
4. Ottawa keeps promoting the proposed Productivity Mega Deduction
Federal ministers spent early October promoting the proposed Productivity Mega Deduction, which would allow businesses to immediately write off the full cost of most depreciable property acquired on or after September 15, 2026, on a permanent basis. The government says this expands the share of assets eligible for immediate expensing from about 15% to more than 65%, including computer equipment, software, and many vehicles (buildings and goodwill are excluded). The measure is still draft legislation, so talk to your accountant before timing a big purchase around it.
Sources: Government of Canada via Cision (October 2, 2026); Department of Finance Canada backgrounder
United States
5. IRS: make cybersecurity part of your routine
For Cybersecurity Awareness Month, the IRS is urging taxpayers, tax professionals, and businesses to adopt simple security habits to protect personal and tax data from identity thieves and scammers. Practical steps include strong unique passwords, multi-factor authentication, and caution with unexpected emails and texts. Tax-related scams spike ahead of filing season, so this is a good moment to review how your business stores and shares financial information.
Source: IRS, IR-2026-119
6. FASB opens comments on the 2027 GAAP reporting taxonomy
The FASB staff released proposed technical improvements to the 2027 GAAP Financial Reporting Taxonomy, the coding system public companies use to tag their financial statements for the SEC. The SEC flagged the proposal on October 9, and comments are due by October 30, 2026. This mainly affects public filers and their software providers, but it is a reminder that US reporting standards keep evolving.
Source: SEC.gov
AI in Accounting and Finance
7. CPA Canada study: AI use is up eightfold, but policies lag behind
A CPA Canada study of 5,000 Canadian CPAs, released October 7, found that organizational AI use jumped from 5% in 2023 to 43% in 2026, and 74% of respondents now use AI at least weekly. However, only 45% said their organization has a formal AI policy. If your team already uses AI tools, a short written policy on what data can and cannot be shared is a smart, low-cost step.
Source: CPA Canada via GlobeNewswire
8. AICPA releases guidance on AI in financial statement audits
On October 13, the AICPA issued a practice aid explaining how auditors should respond when a company uses AI in its financial reporting, and how audit firms should manage their own AI tools. It highlights risks such as poor data quality, hallucinations, and lack of explainability. If AI touches your bookkeeping or reporting, expect your auditor or reviewer to ask how it is controlled.
Source: AICPA & CIMA
9. Accounting firms are buying AI expertise
Top 20 US firm Citrin Cooperman announced it acquired Rosetree Solutions, a Dallas consultancy that builds AI systems and agents inside client businesses. Its CEO said the goal is to give smaller regional companies access to an AI plan sized to their business. Deals like this show AI advisory quickly becoming a standard accounting service, not just a tech-industry one.
Source: CPA Practice Advisor
What this means for you
- Holding property for someone else? Review joint accounts, homes, and other assets now, so you know whether a bare trust T3 return will be due for 2026.
- Planning equipment or software purchases? The proposed Productivity Mega Deduction could let you write off the full cost in year one, but it is not law yet. Plan with your accountant.
- Doing R&D? Higher SR&ED limits and the return of capital expenditures may increase your refundable credits.
- Using AI in your business? Put a simple AI use policy in place and keep sensitive client and tax data out of public tools.
- Protect your data. Turn on multi-factor authentication for your CRA, IRS, banking, and accounting software accounts before filing season.
Questions about how these changes affect you?
Milinchuk CPA helps small businesses, corporations, and individuals in Toronto and across Ontario with bookkeeping, corporate and personal tax, and advisory. I serve clients in English and Russian.
Disclaimer: This post is general information, not professional advice. Tax rules and proposals change, and your situation may differ. Please consult a qualified professional before acting on anything in this article.