As the holiday season gets into full swing, it is easy to forget the few financial and tax planning details that have year-end deadlines. So this note is here to remind you of the following:
- RRSP - The RRSP deadline for 2009 contributions is March 1, 2010. The contribution maximum is 18% of 2008 taxable income to a maximum of $21,000. The deadline also applies to Home Buyers Plan repayments.
- RESPs - Maximize your contributions to RESPs by December 31 to maximize the benefit from the Canada Education Savings Grant (20% of annual contributions up to a maximum grant of $500 per beneficiary based on a $2500 contribution). Beneficiaries remain eligible for CESG grants up to the end of the year in which they turn 17.
- Parents -If you have children under the age of 16, then you are eligible for a non-refundable tax credit of up to $500 for each child registered in an eligible program of physical activity. Make sure to get a receipt from the eligible program in the event of an audit.
- HRTC -The new Home Renovation Tax Credit (HRTC) can be claimed on 2009 tax returns for eligible expenses for improvements to a house, condominium or cottage made between January 27, 2009, and February 1, 2010. The HRTC applies to expenses over $1,000 to a maximum of $10,000 and results in a maximum non-refundable tax credit of 15%. You don’t have to have the improvements completed prior to February 1st, they just have to be paid for.
- TFSA - Every Canadian adult gets another $5000 of TFSA contribution room in January. We will facilitate these contributions, and for those clients with non-registered accounts that we manage, we will arrange for a transfer of $5000 from that account into their TFSA. For those clients that have unused RRSP room, and/or an outstanding mortgage or other debt, we discourage a TFSA contribution until those other priorities are addressed.
- Holiday Spending - If you haven’t established a holiday season budget, it’s not too late. A spending plan will help prevent the January credit card hangover as well as buyers remorse after the shine of the holidays has worn off.
- New Years Resolutions – Make one that you can keep by including us in the resolution! Perhaps it is updating your Will, reducing the cost of your home and auto insurance, doing a cash flow review, increasing your savings or paying down more debt. If there is a financial aspect to your resolution and you tell us about it we will help make sure that you are successful.
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