- Do you have a business? Consider how your employment, business or professional income is tallied, and what taxation options need to be addressed early
- Do you have investment income, such as interest, dividends and capital gains? Figure out what the best portfolio practices are so that you can decrease your tax load
- Are you gaining from deductions in the right way? How do your expenses figure into your taxes, and can you maximize RRSP contributions and other investments to offset gains? What deductible interest expenses can you bring to the table?
- Do you have an estate plan? You will need to look at how to protect your assets and provide tax-efficient income for yourself and your beneficiaries
- Do you donate money to charity? Figure out what your best options are for donations, especially if you contribute a significant amount to your chosen interests
Registered education savings plan (RESP) contributions can be provided for your child or grandchild. What’s the scoop?
- Every year you can contribute $2500 per child under age 18 to this fund
- The federal government will contribute of $500 annually to your fund when you put in the maximum, and as much as $1000 when you double up two years’ contribution in one calendar year
- The federal government will contribute a maximum $7200 per child in their lifetime
A tax-free savings account (TFSA) is an investment savings account, in which you will not be taxed on your earned interest. You can use it to invest in mutual funds and other direct investments. There are no available tax deductions for contributing, but in 2017 you can put aside up to $5500 in your TFSA account without incurring taxes on capital gains.
A registered retirement savings plan (RRSP) is an investment account for which you receive a tax credit for what you put aside for the future. You will be charged tax on the savings when you withdraw your funds. Try to contribute to your RRSP as early as possible; investments made before March 1 of this year can be counted towards this year’s taxes.
What can you claim as personal or professional expenses for your taxes at the end of each calendar year?
- Interest for certain activities (crediting interest for loans personal purposes is not permitted)
- Child-care costs
- Charitable donations
- Political contributions
- Medical expenses
- Tuition fees
- Transit pass costs
- Eligible school supplies for certified teachers and educators
This refers to the practice of decreasing the reported income of the greater earner in a family in order to decrease the overall tax load. You can consider this as an option if:
- You have your own business, and you employ your spouse, children, or partner for a reasonable salary instead of claiming it as personal income
- You contribute to your spouse’s, children’s, or partner’s retirement income through RRSPs
- You loan money to your spouse, children, or partner at 1% interest
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