PART II: Tax Tips you need to know now, before the year ends!

Part 2 in our series of articles geared towards an early start to planning for your 2010 taxes.

These articles are targeted to presenting what you need to know in advance to make the best use of available opportunities.  In this article we cover subjects such as charitable donations, tax-free savings account contributions, RRSP contributions, RRIF’s mutual funds and investment expenses.  To see the full article.  Please use this link http://www.liwanpo.com/taxes_personal.php

2010 Tax Tips you need to know before year end!

Start planning for your 2010 taxes  early.  Don’t wait until it’s too late to minimize your 2010 tax bill.  Use the link here to find out what you need to know in advance to make the best use of available opportunities. http://www.liwanpo.com/taxes_personal.php

If you haven't already, then start planning for your 2010 taxes now:

Investors may be able to leverage tax-loss selling to reduce or recover taxes.  Consider making use of  capital gains or investment transfer opportunities to reduce or delay taxes payable for the 2010 tax year.

Retirement Pro: CPP Reforms 2011-2014

Retirement Pro: CPP Reforms 2011-2014: "Canada Pension Plan Reforms On May 25, 2009, the Ministry of Finance announced changes to the Canada Pension Plan (CPP). These changes were ..."

How to avoid RRSP Over Contributions

It is a sometimes confusing and not well understood fact, but over contributions to your RRSP may be subject to  penalties.  This penalty tax is exorbitant! To help avoid this additional tax burden, read the following tips on RRSP Planning and advance strategies.

If you inadvertently contribute more than your contribution limit, you will be subject to a 1% penalty tax per month to the extent that the over contribution amount exceeds $2,000.  This penalty tax is exorbitant so it is not worthwhile to make over contributions above the limit. Canada Revenue Agency has stepped up its monitoring of RRSP over contributions lately, so here are some tips to help avoid paying this additional tax burden.

 

http://www.liwanpo.com/taxes_personal.php

Managing Severance Packages

Severance Pay, Retiring Allowances, Tax Deferral, RRSP Transfers.  If you need to know more about these subjects, then the following article may be of value to you. 

With the downturn of the economy, some who have lost their jobs, may have received large sums in severance and the uncertainty of what to do with it.

Although receiving a large or modest severance package can help soften the blow of losing your employment, the sudden influx of cash can have serious tax consequences if not managed properly. In some cases, it might even be beneficial to negotiate with your employer and arrange to receive severance payments after January 1.

If severance is a one-time payment or a fixed amount payable over a short period with respect to loss of employment, or after retirement in recognition of long service (without continuation of employment benefits), it’s considered a retiring allowance. Retiring allowances are fully taxable in the year received. However, a portion may be eligible for transfer to the recipient’s RRSP, resulting in a deferral of tax on the amount transferred.

Your life and health insurance benefits also need to be addressed rather quickly — often your group insurance can be converted into an individual policy without the need to provide medical evidence, but there might be only a short period of time to do so. Unless you are in excellent health, this could be your only chance to obtain sufficient insurance coverage at a standard rate.

If you would like more details on this subject please see the complete article, at http://www.liwanpo.com/taxes_personal.php 

Planning to transfer your IRA or 401K Plan to Canada?

On occasion I have been approached by Canadian clients for advise on the transfer of IRA or 401K plans to Canada.  It can be a daunting process if you are not familiar with it.  But, if you have worked in the US for some time and are returning to Canada, you may be planning to transfer your IRA or 401K plan.

Under the right conditions, this can simplify retirement planning and reduce or eliminate the need for duplicate tax reporting.

Depending on age, the rules for the US plan and certain other criteria, a Canadian 
resident taxpayer is able to transfer lump sum superannuation or pension benefits 
such as a 401(k) plan or a foreign pension plan such as an IRA under 
subparagraphs 60(j)(i) and 60(j)(ii) of the Canadian Income Tax Act and defer
Canadian taxation on these amounts.

If you would like more information or assistance with this, please visit our website or use this link to view the full article. http://www.liwanpo.com/taxes_personal.php




 

Welcome to my Blog

Hello!  This is the beginning of my Blog.  I have created this Blog in order to bring the most relevant Tax information to my clients and friends in the most convenient place I could find, a Blog.  My intention is to post new Canada Revenue Agency or other tax related news, along with my comments about what relevance it has in simple terms.