Fuel Excise Tax on Hold But Inflation is Not

The U.S.-Israel war on Iran has thrown global oil prices into turmoil and there is plenty of fallout for consumers. Travelling to Europe this summer? That’s in jeopardy, as jet fuel may run out.  Looking for relief at the pumps instead? The recently announced suspended federal excise tax on gasoline, unleaded aviation gasoline, diesel fuel and aviation fuel here in Canada will soften the blow, but only temporarily: it will be zero from April 20 to September 7, 2026. Here’s what you need to know:

Largely due to advances in preventing heart disease and with Baby Boomers leading healthier lifestyles, Canadians who reach age 65 are more likely than ever to live into their 90's.  This takes retirement income planning into a much longer period, in which a focus on continued accumulation and investing is as important as tax-efficient withdrawal of funds.  Capital must be preserved at the same time.

"You learn far more from negative leadership than from positive leadership. Because you learn how not to do it. And, therefore, you learn how to do it."  Norman Schwarzkopf

Year end is a great time to re-engage clients in conversation about financial decision-making, especially for clients with offshore assets who may need to report some of them on Form T1135 Foreign Income Verification.

For several years now, the prescribed interest rate applied to spousal loans has been set at 1%, but that could change if interest rates rise in 2017. Are you taking advantage of the opportunity to transfer capital to a spouse with a bona fide loan at the current low interest rate?

Knowledge Bureau Report’s monthly poll for October asked: “In your opinion is the new Canada Child Benefit (CCB) better than the combo of UCCB, Child Tax Benefit and Family Tax Cut?”  The results were almost evenly split: 52% voted yes and 48% voted no.

Short of cash or credit for your business? Year end is a great time to review financing options with business-owner clients, especially if there is a pressing need for a few new assets in the business. There may be value in a couple of options beyond bank financing.