What a gift!
Several years ago, the federal government introduced a tax planning strategy called pension income splitting for retired Canadians. After just completing a few hundred income tax returns this year, I have been reminded of just how powerful this tax strategy can be.
One case I worked on this season had a client family who saved a combined $7,100 of income taxes in 2014 by taking advantage of this income splitting strategy. Of course, not all families qualify for this amount of tax savings. However, I seldom come across a family who saves less than $100 each year; most families save between $300 and $3,000.
This is just one of many tax planning strategies we work on for the benefit of our investment clients. We recommend that all Canadians take advantage of all available income tax strategies to minimize the amount of taxes they pay each year.
If you have any questions about income tax planning strategies and how they apply to your situation, I recommend that you speak to a Certified Financial Planner or Tax Specialist to get more information.
