Taxes are a fact of life. They affect every Canadian in most aspects of their lives.
Whether it’s earning an income, making a purchase, owning real property, investing, running a business, or transferring your estate, life is full of taxable consequences that, if left unchecked, could consume an ever increasing amount of one’s livelihood.
While the Income Tax Act was created specifically to ensure that everyone pays their fair share it also affords all taxpayers the right to organize their financial affairs in such a way so as to minimize their taxes whenever and however possible within the legal confines of the Act. And that is the objective of tax planning.
The biggest mistake many people make is to wait until April to concern themselves with their taxes.
Throughout the year there are many financial decisions that can be made that could significantly impact the amount of taxes owed. The Act is full of income exclusion rules, key tax credits, retirement plan contribution options, and investment rules that are easy to miss or miscalculate without the organization and foresight that tax planning provides.
And, if there is any certainty beyond taxes, it is that the tax rules will change as they seem to do nearly every year. Because these changes usually affect such important things as exclusion amounts, credit eligibility, retirement plan contribution limits, and the tax rates themselves, they will almost certainly affect spending, saving, investment and borrowing decisions made throughout the year.
While the process is essentially the same for any taxpayer, it may entail different types of tax strategies depending on your particular financial situation. Strategies for deferring or splitting income, deferring or maximizing retirement contributions, capital gains or losses, property ownership, charitable giving are applied differently in each situation, so they must be developed specific to your needs.
Tax planning and tax strategies involve the application of the rules and provisions of the Income Tax Act, which is voluminous and in a constant state of change.
It is strongly recommended that you seek the guidance of a financial professional with experience in income and investment planning strategies for minimizing personal income taxes.
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We serve individuals, families and businesses in the Abbotsford area. Our primary goal is to help each client meet their unique financial goals. We are never satisfied until you are.
