Save Taxes in Canada Using bLife Insurance/b | Montreal, CGA b.../b
Income taxes are among the biggest expenses you have to pay during your life. Canadian citizens may very well pay as much as almost half of their annual income back to the government every year. Luckily, there are many tools you can use for managing your finances in a way that you’ll end up with significant savings and cut your taxes dramatically.
A large part of tax savings strategies deal with spreading your earnings through your inner family network and thus getting the benefits of lower tax brackets. In this group of tools you’ll find some very interesting possibilities such as:
Family Loans & Accounts Structuring Own & Spousal RRSP Contributions Claiming Home Office & Deducting Home Expenses RESP Contributions Medical Contributions Employing family members Donations to CharityFrom 2009, there’s also a new tool in effect called Tax-Free Savings Account (TFSA). It is similar to an RRSP account, but with some significant differences. For example, withdrawals are non-taxable and they don’t affect other government benefits. On the other side, deposits are non-deductible either. There’s a maximum cap of $5000 for the savings every year, which translates to significant savings over the span of multiple years.
Life insurance products also offer significant advantages and can be useful tools for lowering your taxes and paving the way for maximizing wealth.
There are a number of benefits of using it over other forms of investments, for example traditional RRSP accounts and other assets such as stocks.
No risks involved: the minimum-guarantee percentage will keep the policy profitable under all circumstances. Life insurance therefore makes sense as one of your primary long-term investment tools. No probate fees: since it is a liquid asset, it’s one of the best ways to pass on wealth to the next generation in your family. In the event of your death, they don’t have to...