Tax Cuts at your Fingertips - Reach Out and Claim Yours
Beat the tax with these year-end tax tips for tax year 2009Tax-planning should be a year round activity but even if you’ve been otherwise occupied this,year, you still have time to save money on your 2009 taxes by using strategies like these.
Be deadline savvy: File your tax return and make tax payments on time to avoid penalties and interest. Payments that qualify for tax credits and deductions should be made by December 31.
Deduct to save: Take full advantage of all tax deductions including the most important – your Registered Retirement Savings Plan (RRSP) deduction. Be sure to fill up all your RRSP
contribution room.
Give yourself all the credit: Make full use of tax credits to reduce your tax bill by:
• Pooling medical expenses on the tax return of the lower earning spouse.
• Pooling charitable donations or carrying them forward for up to five years to surpass the
$200 threshold that increases your credit.
• Using the spousal credit for the higher-earning spouse.
• Transferring the age, disability, tuition and/or education credits to a spouse or supporting
relative when not used by a dependent.
• Don’t forget the first time homebuyer, home renovations and moving expenses credits.
Split to save: Income-split by sharing pension income with a spouse, through a spousal RRSP or by paying a salary to (eligible) family members.
Be RRSP savvy: If you’re turning 71 this year, you must wind up your RRSP and need to
decide whether to take the cash (poor choice) or transfer the funds to investments held within a Registered Retirement Income Fund (RRIF) or annuity (much better choices). If you have earned income, you can continue making contributions to a spousal plan until your spouse reaches age 71.
Save tax-free: Make up to a $5,000 contribution to a Tax-Free Savings Account (TFSA). The contribution isn’t tax deductible but money and interest inside your TFSA is tax-free and so are withdrawals that you can make at any time for any purpose. Amounts withdrawn are added to your TFSA contribution room for the following year.
Make down investments pay off: Plan to sell money-losing investments by the December 31 settlement date, which creates capital losses than can offset capital gains.
Buy now to save: If you’re self-employed and claiming the capital cost allowance (CCA) on
depreciable assets, buy them before year end to speed up tax write-offs.
Move to save: If you’re moving to a province with a lower tax rate, do it before December 31 and you’ll pay the lower rate for the full year. If you’re moving to a province with a higher tax rate, try to delay until 2010.
And here’s the best tax-saving tip of all: Talk to your financial advisor/tax advisor to be certain you make the most of these and other tax-reduction strategies that are available to you.
For more information on how to reach these tax cuts visit: canada.gc.ca/taxinfo
Canada's Economic Action Plan : actionplan.gc.ca
This article is presented for general information only, and not a solicitation to buy or sell any financial products. Consult your financial advisor for advice regarding your financial or tax situation.
Informational Video from Canada Revenue Agency
Informational Video from Canada Revenue Agency
Labels: HRTC, investment planning, RRSP, tax cuts, tax deductions, tax planning, tax strategies, TFSA, transit pass credit
posted by laramaryann @ 10:48 PM
0 Comments
