2010 Brings Additional TFSA Room

With the turning of the calendar to a new year, I want to remind you of a potentially significant tax savings opportunity.  You will recall from reading Year End Tax Planning #2 the new Tax Free Savings Accounts are cumulative, meaning that each new calendar years opens another $5,000 of contribution room.  For example, say you deposited $4,000 [...]

Home Renovation Tax Credit Almost Finished

You only have until February 1, 2010 to take advantage of this temporary Credit  You will recall from reading Year End Tax Planning #1 that eligible renovation expenditures made from January 28, 2009 through January 31, 2010 only, qualify for the credit.  Don’t miss out.  For further details, see my earlier post on the topic. Regarding the deadline, this [...]

Year End Tax Planning #7 – Personal Payments

There are a number of payments that must be made by December 31st in order to be included in your 2009 personal income tax return.  Don’t miss out!  The final tax instalment payment for 2009 was December 15th (if you missed it, make it immediately as  non-deductible interest on late or deficient instalments is currently 5%). Charitable donation payments [...]

Year End Tax Planning #6-RDSP Accounts

RDSP stands for the new Registered Disability Savings Plan.  In this article I will give you some basics of these new plans.  You will want to open and contribute to this new account prior to the end of each calendar year so as to maximize any Federal matching dollars available. Introduced in the 2009 Federal [...]

Year End Tax Planning #6 – Tune Up Your RRSP

The 2009 RRSP limit is lesser of 18% of 2008 earned income, or $21,000.  In order to maximize the return on your RRSP investment, you should consider the following: If you haven’t made your 2009 contribution yet, make it now.  The deadline is March 1, 2010, but why wait?  The faster you contribute, the faster [...]

Year End Tax Planning #5-Make Your Investment Portfolio Tax Efficient

Now is the time to sit with your financial advisor and review, among other things, the following three points: 1)  Make Sure You are Earning Low Tax Rate Investment Income. The current maximum tax rates for 2009 on $1 of investment income earned are as follows: 46.41%   Interest and other investment income 31.34%  Non-eligible dividends 23.20% [...]

Year End Tax Planning #4 – Don’t be a Lender to CRA

If every year when you file your personal tax return you receive a significant income tax refund, then you are effectively lending your money to CRA with no interest or other benefit.  That refund you receive is not found money, it is your earned money that could be in your pocket, or invested in your [...]

Year End Tax Planning #3-Spousal Loans

One of the main things I talk to clients about is income splitting among family members.  Our mandate is to ensure our clients are paying the least amount of tax possible, and by spreading that income over as many people as possible, we can achieve this objective. Spousal loans are one way to split investment [...]

Year End Tax Planning #2-TFSA’s

Some have described the new Tax Free Savings Account (TFSA) as the most important investment vehicle to come along since the introduction of the Registered Retirement Savings Plan (RRSP).   However, the TFSA is the mirror opposite of the RRSP, being that contributions are made with after tax money, and any withdrawals from the plan are [...]

Year End Tax Planning #1-Home Renovation Tax Credit

This is the first in a series of posts to help you minimize your personal income taxes as we approach the fall of 2009, and in the not so distant future, the end of the taxation year 2009. The Home Renovation Tax Credit (HRTC) is one of the most advertised and heavily touted tax credits [...]