The Importance of Provincial Budgets: Elbows Up and No Bracket Creep!

Some of the right things are happening in Nova Scotia, from the perspective of improving standards of living in that province.  And that’s important news because according to the Fraser Institute, Canadians have suffered the worst five-year decline in their standard of living over the 2020-to-2024 period since the Great Depression.  It notes, our Gross Domestic Product (GDP) per person decreased by 2.0% (0.4% annually) ; this despite aggregate GDP growth of 1.5% over the period.  Further, all ten provinces are experiencing stagnation, which is unique in our history.  So what’s the good news in Nova Scotia, at this critical juncture?

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.

Together with our partner, The Investment Industry Association of Canada (IIAC), Knowledge Bureau is very pleased to report that our inaugural Vantage Series Event, held on May 9th at the National Club in Toronto, was a resounding success. Read on to find out why, and mark your calendars for the next Vantage event on October 31.