Why Economic Growth is Job #1

It’s provincial budget season, with a federal election coming up soon. What should Finance Ministers in Canada be focusing on to try to meet the tariff winds head on and ensure the standards of living of Canadians going forward in a proactive way? The answer is to focus on economic growth. What is it, why is it important to consumers and voters and how do we measure that?

Should you buy or lease a new vehicle or computer before year end?  It’s a great question for financial advisors and their clients to discuss before year end. Canada’s tax system has some excellent incentives for people in the market for buying business assets before year end.  Here’s an overview of the provisions that were first introduced with the November 21, 2018 Fall Economic Statement:

Abe Toews, CFP, CLU, CH.F.C, CHS, Chair of the Board of Directors, Advocis will make a special guest appearance to discuss year end donations strategies as he shares the virtual stage with expert headliners at the November 18 Virtual CE Summit.  The theme is focused planning for investors and self-employed taxpayers.  Advisors who need to brush up on advanced planning, especially for corporate owner-managers, should mark their calendars and register no later than Monday, November 16.   

The deadline for filing Registered Charity Information returns was extended to December 31, 2020 for returns due between March 18, 2020 and December 31, 2020. However, the CRA’s Charities Directorate is also encouraging charities to file as soon as possible to avoid expected processing delays as a result of the high volume of returns that will be submitted around the deadline.

Yesterday, Canada’s Chief Public Health Officer Theresa Tam announced that Canadians should be wearing triple-ply non-medical masks when in shared indoor spaces with people from outside of their immediate household, and when in close contact with others in public. It begs the question, will Personal Protective Equipment (PPE) and other health related costs be deductible? The answer is, it depends.     

The Canada Pension Plan (CPP) maximum contributory earnings for 2021 and the new premium rate have both risen, adding another financial burden to both workers and employers as the new year approaches.  With required premiums of $6,332.90, eclipsing maximum TFSA contribution room of $6,000, there may be little left to save for a tax-free retirement. Further, there are several other reasons why this rising CPP obligation may bring the wrong after-tax results over the long run.

Making an RRSP contributions by March 1, 2021  is a smart move by eligible recipients of Canada Recovery Benefits (CRB) if total net income will exceed $38,000. The reason?  A very expensive clawback of the CRB.