Saturday, December 10, 2011

More Year End Tax Tips

Giving gives back!
Your donations to CRA registered charities generate a 15% – 29% tax saving. Make sure to ask for an official receipt as you will not be refunded without it.

Public Transit pays off!
If you use public transit to get around, you and any eligible dependents that you have may be entitled to a 15% non-refundable tax credit. Environmentally friendly AND financially rewarding, public transport is taking you places!

Keep your receipts
No need to send your receipts when you NETFILE your tax return, although the CRA may send you a request later for:
• Medical expenses
• Charitable donations
• Child care expenses
• Spouse or child support payments
• Moving expenses
Use a big envelope or shoe box as your "official tax slip holder" and keep all tax related information there.

Save for retirement and save on your taxes!
If you invested in your RRSPs in 2011, your contributions are exempt from taxation as long as they stay in the plan. Invest early in the year to gain tax free interest on your investment and make your money work for you.

Important tax dates for tax season 2011
• Feb 13, 2012 – NETFILE Services are open
• Feb 29, 2012 - RRSP Deadline
• April 30, 2012 – Tax Filing Deadline
• June 15, 2012 – Self Employed Tax Filing Deadline
• September 30, 2012 – NETFILE services close for tax season 2011

Sunday, December 4, 2011

Additional CPP Changes effective January 1, 2012

Several changes are taking effect on January 1, 2012 that may affect you. You will not be affected by these changes if you started receiving a CPP retirement pension before December 31, 2010, and you remain out of the work force.

If you are between 60 and 65, receiving CPP and still working, you and your employer now must contribute to CPP. The additional contributions will count towards a Post Retirement Benefit (PRB).

If you are between 65 and 70, receiving CPP and still working, you and your employer now have the option to contribute to CPP. The additional contributions will count towards a Post Retirement Benefit (PRB).

If you are between 60 and 70 and not yet collecting CPP, the adjustment factor that will be used will change. For those taking the benefit before December 31, 20110 the adjustment was 0.5% per month above or below age 65. This percentage will gradually increase to 0.7% per month for those taking late retirement and 0.6% for those taking early CPP . These changes will take full effect by 2016.

In addition, the number of years with zero earnings that are automatically dropped from the calculation of the CPP pension will increase.

Starting in 2012, contributors no longer have to stop working or significantly reduce earnings for two consecutive months to receive the CPP retirement pension before the age of 65. This will make it easier for Canadians to make a gradual transition to retirement.

For more information, you can check the Service Canada web site or give me a call.

Service Canada has a retirement calculator on their web site to assist you in calculating your benefit.