If you are like most other people, you don’t start thinking about saving money on your taxes until you sit down sometime in April of the following year to comply with the CRA regulation of filing your personal income taxes by the last day of the month. As you learn each year, you should have sat down with or without your advisor towards the end of the tax year – November/December and looked for tax saving opportunities. Here are a few items to consider:-
- Tax loss selling – If you have large capital gains for the year perhaps you should consider to finally dumping those ‘dogs’ and apply the capital losses.
- Charitable donations – Making a donation before December 31 of this year will help reduce current taxes.
- Employer bonus – Deferrring is always a good choice, so if you are entitled to a bonus in 2012 take the money after January 1, 2013. This is the simple answer, but your tax rate in each year may tell a different story. Looking at the issue now could lead to saving money!
- RRSP conversion – If you are turning 71 in 2012 make sure to make your contribution before December 31 – don’t wait until late February 2013. The deduction will not be allowed!
- Fees – Pay all deductable fees – tuition, mamagement, safe deposit box, accounting, childcare, etc. before the end of the year.
Remember each taxpayer is different and the above tips and comments are but a short ‘idea’ reminder. Should you need more information please post your question or give me a call. Next week – 5 more tax saving tips that will look good on your bank account.
