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Latest News
What you need to know about the first-time homebuyers savings account + MORE Apr 3rd
How to go about securing the best savings strategy in Canada.
What you need to know about the first-time homebuyers savings account - thestar.comContinue Reading On thestar.com »
What are money scripts? What’s yours? - moneysense.caMoney scripts impact our thoughts, feelings and bel.... More »
4 Things You Should Do Now So You Can Save on Taxes in the New Year Dec 14th
With all the hustle and bustle that’s synonymous with this time of year, it’s important to also take a closer look at your personal finances before heading into 2019 – and we’re not talking about holiday budgets. Yes, most Canadians are busy with Christmas shopping and festivities, but .... More »
Creating a will is the “adulting” milestone you need to hit this year + MORE Jul 19th
When it comes to self-improvement, most of us have a hard time with follow-through—and whether you stuck to your Keto diet or not, there are likely items on your financial to-do list that just never get crossed off. One of the easy actions to delay is creating a will. After all, no one wants to th.... More »
In Your Corner: My house is my retirement plan. Am I doomed? + MORE Aug 29th
Owning a home is a great investment but we all should have other investments socked away for retirement — ideally inside a Registered Retirement Savings Plan (RRSP), says this week’s expert..... More »
Summer energy savings: How to stay cool without cranking the AC Jul 23rd
When the mercury begins to rise, Jeffrey Siegel sinks into a routine. Windows facing the east are covered in the morning before those in the west are shrouded in the afternoon, his fan gets switched on, more of his cooking moves to the barbecue, and a clothesline is brought out whenever there is la.... More »
How to pay off debt and save for the future
– moneysense.ca
(Illustration by Amedeo De Palma)Phil and Candace Ranjan are smart people. In fact, the two chiropractors have four university degrees between them. And for a young married couple still in their 20s, they also have a healthy combined income of $110,000. But the pair, who live in London, Ont., also has three huge liabilities: $47,000 in student loans, $94,000 on a line of credit and a $400,000 mortgage on a home they purchased last year for $431,000. In total, they are starting married life deep in the red, with net liabilities of $96,800. “We have huge expenses and absolutely no spending money,” says Phil, 29. “We’re professionals but we’re not earning to our fullest potential. We know we need to pay down our debt but aren’t sure which way is best. And we’d love to start investing but we just can’t seem to save any money. It’s frustrating.”
The Ranjans (whose names we’ve changed to protect privacy) married last fall. They spent two years saving up for the cost of their wedding and $31,000 for a down payment on the 1950s-style red brick bungalow they now own…
The tax shock that comes with a first real job can be a great chance to help your kids take control of their financial affairs.Moving investments to a new country
– moneysense.ca
Q: If you are moving out of the country, how much of your investments can legally go with you?
—Mark Scanlon, Brighton, Ont.
A: Legally, you can take whatever investments you’d like. But there are a few tax issues to consider. Toronto chartered accountant John Mott says, “If you liquidate investments before you leave, you will of course be taxed on any capital gains that you trigger. If you leave while still holding investments with accrued capital gains, then you are treated for tax purposes as if you had sold the investments, making the gains taxable.”
This is called a “deemed disposition” but doesn’t apply to RRSPs. So you could leave the money inside your RRSP, and pay income tax on it down the line when you withdraw it. If you’re a non-resident when that happens the withdrawal will be subject to a flat 25% non-resident withholding tax, unless reduced by a tax treaty. If you decide to remove the RRSP investments before you become a non-resident, Mott says, then the withdrawal will be taxable on your final tax return before your date of departure…
—Mark Scanlon, Brighton, Ont.
A: Legally, you can take whatever investments you’d like. But there are a few tax issues to consider. Toronto chartered accountant John Mott says, “If you liquidate investments before you leave, you will of course be taxed on any capital gains that you trigger. If you leave while still holding investments with accrued capital gains, then you are treated for tax purposes as if you had sold the investments, making the gains taxable.”
This is called a “deemed disposition” but doesn’t apply to RRSPs. So you could leave the money inside your RRSP, and pay income tax on it down the line when you withdraw it. If you’re a non-resident when that happens the withdrawal will be subject to a flat 25% non-resident withholding tax, unless reduced by a tax treaty. If you decide to remove the RRSP investments before you become a non-resident, Mott says, then the withdrawal will be taxable on your final tax return before your date of departure…
Do landlords need to incorporate?
– moneysense.ca
Aaron Vasas, Fenwick, Ont. (Jennifer Roberts for MoneySense magazine)Q: I have three rental properties with a total of four tenants. Should I consider starting a holding company or limited corporation for my income properties? What are the benefits?
—Aaron Vasas, Fenwick, Ont.
A: Run a dental practice—start a corporation. Run a rental property business—don’t bother. Different types of businesses are treated differently by the CRA and the tax system isn’t set up to encourage landlords to incorporate, says Hank Bulmash, a CPA at Bulmash Accounting. “Essentially they are saying, ‘We are going to tax your corporation as if you owned the properties personally.’” The corporate income tax rate for rental income is the same as the highest marginal tax rate—so there are no tax savings. The exception is if your business has at least five full-time employees. That makes it an “active business” and it qualifies for the small-business tax rate, in the 15% range. But it doesn’t sound like you have that many people on payroll…
The Smartest Way To File Taxes: 4 Tips
– ratesupermarket.ca
RRSP season has come and gone – and now it’s time to focus on filing your income tax return. If you were a last minute RRSP contributor (or missed it altogether), filing your tax refund early can be a way to redeem yourself. The deadline to file may seem a long way away, but it’s never too early to start planning.
Here are our top tips for getting the most out of your taxes this year.
Tip 1: Understand the Canadian Tax System
Doing your income tax can seem like a chore, but it doesn’t have to be. In Canada we have a progressive tax system – the more income you earn, the higher your tax rate. Those in higher tax brackets will gain the most from tax deductions.
The onus is on individuals to claim the tax deductions and credits they are entitled to. There are dozens of these deductions and credits available to individuals and families, all of which can add up to hundreds in tax savings. In fact, in 2012 the average family of four could have saved more than $3,200 annually in taxes, according to Canada Revenue Agency (CRA)…
