How to minimize the tax payable by your estate – Vacation property strategies
Here are two ways to reduce an estate’s tax liability related to your cottage, cabin or chalet. Transferring a vacation property during your lifetime Say you own a vacation property that you intend to hand down to your children. You could cover the capital gains tax liability today, but you worry about your estate facing […]
How to minimize the tax payable by your estate
Canada is the only G7 nation without an estate or inheritance tax, but the government still collects tax on Canadians’ estate assets, often at the top marginal rate. For example, assets in a Registered Retirement Savings Plan (RRSP) or Registered Retirement Income Fund (RRIF) are taxed as income on the final tax return. Also, 50% […]
Saving tax all year
Tax season is approaching, which means looking for credits and deductions to pay less tax wherever possible. However, other opportunities are available to save tax that may be implemented at any time during the year. Here are various tax-saving strategies—some familiar and others specialized. Perhaps one or more might benefit you, now or in the […]
Why tax deferral works
Whenever you have a chance to defer paying tax, a common thought is, “Why pay tax now when I can pay it later?” However, there’s more to the story than simply postponing the tax bill. Tax deferral offers three potential benefits. First, paying taxes in the future gives you more funds to meet your current […]
Will your parents need your help?
The day may come when your parents find it more difficult to take care of their financial matters. Your help can make a difference, whether it’s in the form of your time, advice or financial assistance. Not all parents are comfortable sharing their financial life with their children, but your efforts in getting them to […]
Transferring the family vacation property: now or later?
Across the country, a vacation property may be known as a cottage, cabin, chalet or camp. One thing they all share is a looming tax liability. When a vacation property is sold or transferred, the owner must pay tax on the capital gain. If an individual purchased a vacation property for $300,000 and sold it […]
Help your child purchase a home with an FHSA
Today’s housing market remains challenging, leaving many first-time home buyers hard-pressed to come up with a down payment. So, quite often, parents or grandparents want to help out. As of April 1, 2023, a new avenue has opened to help fund a down payment: the First-Home Savings Account (FHSA). Although you can’t contribute directly to […]
Split your income to save tax
As an individual, you can save tax by using credits, deductions, exemptions and registered investment accounts. As part of a couple or family, you have opportunities to save tax by transferring money to your spouse or a child who’s in a lower tax bracket. [Section A] Here are some of the more common methods of […]
Managing a windfall, large or small
It’s a challenge no one minds facing: determining what to do if a lump sum comes your way. With a smaller windfall, the decision often focuses exclusively on how to use the money. A larger windfall brings larger issues into play. Bonuses, tax refunds and more Some of the smaller windfalls may seem like found […]
Time for a vacation property chat?
If you plan on passing down your cottage, cabin or chalet to your children, make sure they actually want to own the property. Finding out where everyone stands will prevent family conflicts down the road and help you with tax and estate planning. Gauge your children’s interest When you ask your child or children about […]