Canada Needs a Financial Plan

According to a July 23 publication by the Fraser Institute, we are getting poorer here in Canada and the prospects for economic growth are looking grim.  This should be of concern to every Canadian concerned about their “real income” – that’s their purchasing power – and by extension - their ability to fund consumption now and for important family milestones in the future:  retirements, education and homeownership.  It’s grim, but there are practical suggestions for a turn around plan. Here’s a synopsis of the report.   

Knowledge Bureau and Evelyn Jacks are proud to release the 2019 edition of Essential Tax Facts: How to Make the Right Tax Moves and Be Audit-Proof, Too on May 24, 2019. Featuring invaluable Audit-Buster Checklists and the latest from the March 2019 Federal Budget, Essential Tax Facts will help you position yourself for greater success with up-to-date information in an ever-changing tax environment.

To incorporate, or not to incorporate? It’s a timely question, considering recent corporate tax reforms. However, it’s also a question that existing business owners and aspiring business builders should think about post tax season as they discuss business growth planning with their tax specialists. It’s an important strategy that can save thousands of dollars that helps build family wealth over the long run.

The federal government announced last week that the Canada Child Benefit (CCB) will be increasing for the second consecutive year as of this July. Unfortunately,  many families are subject to a clawback of the generous benefit when their family net income rises. Worse, many Canadians don’t realize how critical an RRSP contribution can be in generating more of this lucrative tax-free benefit. Tax and financial advisors can add high value by helping to connecting those dots.

If you pay interest on money borrowed to earn investment income, you can claim a deduction for the interest paid as a carrying charge. That’s quite lucrative as the deduction offsets all other income of the year and can help to reduce net income, the figure upon which certain government benefits, like the Canada Child Benefit, are based.  But, the claim is not as straight-forward as you might think.

June 17 is an important date for the self-employed. Not only is it the tax filing deadline (as June 15 falls on a weekend), it’s also an opportunity to decide whether or not to start contributing to the Employment Insurance (EI) program. There are trade-offs that small business owners need to take into consideration, and advisors play an important role in this decision-making process.

Financial planning for critical long-term care and disability has been a complex process for advisors in Canada. But a recent Supreme Court of Canada (SCC) decision regarding whether the absolute discretionary trust (Henson trust), which is designed to protect a disabled person’s assets, brings national clarity to the issue of whether or not this estate-planning tool can impact a disabled person’s eligibility for other benefits and credits.