My spouse contributed about $30,000 to her RRSP account using her own contribution room. When claiming the tax credit, she only wanted to claim $25,000. Can she allow me to claim the remaining $5,000 to maximize the tax benefits for both of us?
I am confused about the taxes. As I am currently working for 2 employers and I am paying almost 25% out of my salary from both the employers.
I am unsure if I am paying more or less?
I am unsure if I still owe some money even after paying so much of taxes?
If I am earning 42000 as a net income, do I still need to pay taxes to the government at year end?
Are there any means to avoid/reduce paying Canadian withholding tax on RRIF withdrawals?
As I understand then Canadian tax residents ...
- Canadian tax residents are subject to personal income tax on RRIF withdrawals
- CRA permits C$2000 tax-free withdrawals per year per 65+ age Canadian tax resident
- CRA permits pension splitting
For non-residents ...
- CRA deducts withholding tax on RRIF withdrawals
- Rate of CRA withholding tax typically...
Can anybody help with this income tax question?
I am a Canadian. If I accept a transfer to US, working for the same company, what income taxes do I pay?
I will work for several months in Canada starting January 2024, then get transferred to Michigan, US.
In my mind, the taxes are:
1. Canada’s taxes for the months of residency in Canada.
2. Michigan income tax for the rest of 2024.
3. Michigan income tax for the years after 2024
A bit confused by what the cra website reports as available RRSP deduction limit.
It starts with the 2022 deduction limit of 25k.
It then adds how much I contributed *and* deducted in 2022 - 5k.
says I have 20k room for 2023.
However I actually contributed 6.5k in 2022. But I carried forward 1.5k.
Does it mean I have 20k room available or 18.5k in 2023?
The website says 20k but I'm not sure about the carried forward amount.
Welcome insight on non-Canada jurisdictions that offer Canada-like pension income splitting?
In Canada, per CRA, pension splitting rules allows a couple to reduce personal income tax. If a husband and wife had $10 and $90 of pension income then they could each report $50.
I am actively exploring tax residencies other than Canada for retirement - years in which I would have RRIF withdrawals.
Given unequal RRSP pots between husband and wife then...
Can I leave Canada for, lets say three years, and become deemed non-resident without filling up form NR73
I will not have any address abroad (so far USA and Mexico) acting as a perpetual traveller. (by RV)
My intention is to send CRA simple letter informing about my date of going abroad and asking to deduct monthly tax (25%) from my CPP/Old age pension. My annual income is about 10K. No need to report to CRA.
no house,...
Does UK HMRC tax authority legislation on one-time, tax-free withdrawals apply to Canadian RRIF pension?
HMRC, UK tax authority, permits a one-time tax-free pension withdrawal. Up to 25% of pension pot value may be withdrawn tax-free, up to a maximum level based on lifetime allowance.
I'm a Canadian tax resident with a RRSP (UK QROPS origin). Open-minded geography for retirement. Motivated to migrate portion of Canadian self-directed pension...
I would very much welcome guidance in regards withdrawal tactics from a Canadian RRSP whose origin was a QROPS transfer.
- In early 2015, I completed the transfer of an occupational UK pension into a Canadian RRSP (Scotia iTrade)
- All aspects were duly filed and CRA ok
- I understand that relevant UK legislation changed after my transfer date
- At some future date then I will seek to make withdrawals from the Canadian RRSP
- I am keen to avoid...
Subsidies to rich seniors make no sense Last year, the federal government spent $69.4-billion on elderly benefits. That will jump to $101.3-billion in fiscal 2029. Debt servicing costs are set to rise to $60.7-billion in fiscal 2029 from $35-billion in fiscal 2023. Together, those two line items will grow by $57.6-billion by the end of the decade...
Remove age from the equation for a moment, and answer this question: what conceivable reason is...
In this thread , Springbok describes a situation with a big capital gain that makes him (her?) reluctant to sell a position.
Let me describe a similar situation, much simplified because I am posting without a calculator at hand. I am going to use BC tax rates because they come to mind easily, top marginal rate because it's as unfavourable as possible.
Suppose you own some highly appreciated securities and the position is large enough that you...
I have a question related to a GIC I am a joint holder with my deceased mother. I am her adult son. The joint aspect was just for convenience and my mother would have claimed 100% of the interest on her 2024 tax return had she survived to the maturity date. The GIC in question matures in the summer of 2024. I have read several posts and I am not sure if I have 2 options here for tax purposes. I understand that under current rules, the...
If some US companies merge and you are a shareholder, they file a form 8937 which usually describes how the transaction is treated in terms of cost basis allocation, tax free status, etc.. for tax purposes in the US. Can this form be used to generally apply the same treatment in Canada for a stock & cash merger? If not, is there some other way to figure out which of the many possible ranges of basis between 100% realized gain and 0% realized...
Asking for a friend who will be out of country March 15 until early May. They don't want to file taxes from abroad.
Assuming T3's are not yet available on March 15. He files his taxes without the T3s in March and then submits a T1Adj in May 5th once back in the country. He reports the (say $5k) income before CRA notices and he has tax owing as a result. Would there be interest/arrears/penalties? He has no
unreported income in the past 3 years...
CRA admits it paid out $63M in 'sham' tax refund scheme An investigation by The Fifth Estate and Radio-Canada's Enquête into carousel schemes in Canada has revealed international networks of sophisticated criminals claiming hundreds of millions of dollars from Canadian government coffers while facing few to no consequences...
Well-known to authorities in the EU and U.K., a carousel scheme sees participants pass goods around in a circle of...
Given the lengthy waits for elective surgery like hip and knee replacements I'm hoping that someone with first-hand experience can offer some advice.
Ms. Bylo needs a hip replacement. She's been approved for a hip replacement. Her surgeon estimates this will happen in 1Q24 or 2Q24. Afterwards she will need several months to recover. Since September she can walk only with a pair of hiking poles as canes. She walks much slower than she could...
Say you have 6000 new space this year. But you withdraw 10000 this year also. Now you cannot deposit the 10,000 again until 2023 Jan 1. But can you still deposit up to 6000, the new space you had this year which you didn't use?
Looking for relevant information regarding CPP calculations: If an individual is 46 years old in 2023 and has contributed only for 2022 (C$2400) and 2023 (C$ 7600) but never contributes thereafter nor did one contributed anything in past, what would be their pension at age 65 in Ontario, Total contribution including employee and employer is about 10k. TIA
I've done some looking around and not found this addressed anywhere on here but if it is feel free to move this.
I understand CG can be spread over up to 5 tax years by deferring the payments (capital gains reserve) but this question is a bit different. What is the tax situation if I sell a non-registered asset (a house but not a principal residence) to someone with a contract for payment over 10 or 15 years, like a mortgage? I understand it is...
Hi all
Just wondering if the loyalty program management fee credit Empire Life gives counts as a contribution towards TFSA limit?
I haven’t contributed to the empire life tfsa account in a number of years but qualified for the loyalty program as the funds I have there are over 10 years now.
I noticed a small deposit on my June statement and also shows online. I max out the yearly tfsa contribution in early January.
So if this management fee...
It is the time of year where the financial columnists start writing or re-posting/re-hashing past advice on actions that a prudent investor might take before year-end that might provides some tax savings.
Specifically prompted by Tim Cestnick's article Investors should consider these ideas before year-end to save tax - The Globe and Mail , all of which have been covered in previous FWF topics and in our wiki. However this topic might be useful...
Hey everyone, thinking about moving to Spain in a few years and just trying to learn more about how my accounts, especially RRSP, will be treated after the move.
My primary question for today is whether the US withholding tax on dividends from US stocks (and potentially Canadian withholding on Canadian stocks?) will start to apply again after I am no longer tax resident in Canada, even if it is in an RRSP. Anyone have experience with RRSPs...
Is it a good idea to reduce over all tax paid in RRSP account
Should i sell stock from RRSP account at a loss at the same time buy the same in my TFSA account
Example sell BCE at a 10% loss in RRSP account
Buy the same amount in TSFA at the same time
For a CRA clearance certificate for a T1 Deceased and T3 Trust, the CRA is requesting:
• a detailed list of the assets that were owned by the deceased at the date of death, including all assets that were held jointly and all registered retirement savings plans and registered retirement income funds (including those with a named or designated beneficiary, their adjusted cost base (ACB) and fair market value (FMV) at the date of distribution by...
My oldest daughter has earned her first pay cheque but is still a minor. As best I can tell she's allowed to have an RRSP and the only difference in rules is that the $2,000 over contribution limit is not available to her till age 18. So that means she can't contribute to the RRSP until Jan 01, 2024.
But I wouldn't mind setting it up in advance of that and having it ready to go. I'd be doing this via BMOIL if possible. So has anyone gone thru...
I just noticed that TDDI has applied a 30% US withholding tax rate to this year's distributions instead of the normal 15%. Has anyone else encountered this, especially those at other brokers? IIRC, the 15% rate is under the Canada-US tax treaty and I've found no report of it being changed this year.
Like clockwork, UFile | Tax Software for Canadians 2022 version is available for purchase. They are indicating Save up to $8 until December 12, 2022 .
Unfortunately it looks like they've bumped the prices for 2022 a bit more than previous. UFile 2022 Screenshot 2022-11-23 071935.png The (*) indicates Operating system : Windows® 8.1, Windows® 10 or Windows® 11.
For context:
UFile 12 for Windows 2021 cost me $27.99
UFile 12 for Windows 2020...
Can anyone provide some wisdom regarding reporting my US-based (foreign) life insurance on Form T1135? The rules state that the life insurance is a reportable asset, and you have to report the cost.
Advisor's Edge discusses this nicely at ...and it is extremely complex. (although, for my term policy my cost should just be the sum of the annual premiums I've paid out (begs the question, those paid only since my PR? or all premiums?)
I have some half philosophical and half legal (Canadian law here) questions about the correct way to deal with securities transactions denominated in foreign currency. In Canadian tax law, and to use a sale of shares for an example, you dispose of the shares on settlement date, not trade date. See, e.g. this . Philosophically, that's wrong, because your economic exposure is fixed at the time the trade is made. If you sold shares for $60 on...
I have a main engineering full time job and a side hussle/business on side that I want to start up more seriously through a sole proprietorship (SP). I'm still in the product development stage so I won't be selling anything and wont have revenue at all for the next 1-2 years...just expenses. I'll be at a loss with expenses and I'll want to write off my expenses against my income from my full time job. My question relates to setting up the SP:...
It's been a good 9 years, but my wife and I have decided that it's time to pack and go back to Spain, at least for a while.
I'd like to prepare everything so that next year taxes are as straightforward as possible. This is what I have in mind:
Before leaving:
Updated below, as this line was misleading and confusing. Sell everything in TFSA / registered accounts, so that no departure tax is triggered. We don't have any other assets, and...
Wife and I are Canadian residents (she is Citizen, I am a PR) and are both retired and I am trying to understand tax strategies.
I have US income from Social Security (SS) and IRAs (retirement accounts) and we share a fair bit of Canadian income from banking interest and around $20K in a house that we rent to her family (that's gross; net might be 1/3 of that, it's owned outright but we pay for taxes and utilities, I assume there's some...
If Vanguard or iShares decides to close an AA ETF like VGRO or XBAL, my understanding is investors would receive the NAV and a taxable event would be created. If that's true, isn't this a considerable risk to holding these funds in non-registered accounts? Imagine being in retirement and finding out all your investments are getting liquidated and you'll owe a potentially massive tax bill. I'm wondering if these funds are best held only in...
Hypothetically speaking, if the fed’s were to increase the capital gains inclusion rate in the next budget, would it be effective from the end of March onwards, or would they backdate it to the beginning of January? Does anybody remember what they have done in the past?
If I hold US stocks (say, Telsa) at BMOIL (Canadian brokerage) with my spouse under joint with right of survivorship, will US estate rules apply when one of us pass? If so, I would guess the account will be frozen.
In reality, how long does it take to clear for the other spouse to take legal title of the assets (and able to buy/sell) within that account?
My understanding is everything in that account goes to the other spouse without the need...
My uncle (a Canadian) is a shareholder of a private company (Asian) in which it holds a bank account in USA ( the bank ). The company is only holding US stocks and cash at this bank account.
One of the shareholders passed, his heirs will have the legal inheritance/estate document ready in 2 months. Then the shareholder composition (ie. updated Certificate of Incorporation) will be updated with his heirs' names within 2 weeks after the legal...
So one of the assets in my TFSA, a put option went from being an eligible asset to a non-eligible asset. (The underlying stock got delisted)
I received note of the event from my broker and I transferred the options out of the TFSA.
However, subsequently the CRA penalized me with a $3K charge on my TFSA.
According to my broker I can get this money back by contacting CRA, but they had no info on how to go about doing it.
An interesting report from the Fraser Institute . You can get the full report pdf through the link.
The average Canadian family now spends more of its income on taxes (42.4%) than it does on basic necessities such as food, shelter, and clothing combined (37.6%). By comparison, 33.5% of the average family’s income went to pay taxes in 1961 while 56.5% went to basic necessities.
The list of taxes was interesting as well. The average Canadian...
If a US company in which you hold shares has some sort of merger where you receive either cash, stock, or a combination of cash & stock, how is this treated to a Canadian shareholder? Is the cash a return of capital and the stock received will be the difference between the cost and selling price or is the stock and/or cash received one or both an immediate foreign dividend in the year of the distribution? On the other hand, it would seem a...
I am newly self-employed, in BC, and trying to understand an aspect of using RRSPs.
Let's say you earn $50,000 in one year, and after expenses, deductions etc., it is determined that you owe $15,000 in tax.
If you then contribute $15,000 to you RRSPs, does that mean that you then don't owe any tax?
Say my wife is 85 and say I've died and her required minimal withdrawals from our RRIFs (now all in her name) are big enough to trigger the OAS clawback ($81761*inflation).
If she puts money into her RRSP now (she has about ~50k of room and she's under 71) and doesn't deduct it from her income now, can she deduct it from her RRIF withdrawals when she's 85 after I'm dead?
We are going start withdrawing from her RRSP soon, to take advantage of...
In my non-registered account, I hold some US-domiciled ETFs of international stocks. The US withholding tax on dividends paid to my brokerage is recoverable at tax time (call this Level 2 tax ). However, the withholding tax imposed by 3rd countries on dividends paid to the US ETF provider (call this Level 1 tax ) is generally talked about online as not recoverable, or probably not recoverable.
We have a family cottage that has appreciated in value, and some RRSP contribution room, and some non-registered savings. I don't want to pay 48% tax on half of the capital gain (the highest marginal tax rate in Alberta) when we sell it. If I could shelter some of the gain in an RRSP we could withdraw it over several years in a RRIF, and probably pay 30.5% marginal tax on those withdrawals, as long as we're both living.
Here is the situation. I’m trying to figure out how to best plan for the capital gains that will occur when mum passes one day so we can keep the family cottage. There is a mix of principal residency in there which I'm trying to figure out how to handle.
Details:
1999 – Parents purchased cottage for $10k (very cheap due to purchasing from a family member).
2017 – Tore down old boathouse and build a...
So I am doing my deceased mother's final T1 tax return. She was in a nursing home for the last 6 months of her life. She was suffering from Alzheimer's. The LTC facility supplied me with a receipt for her monthly care. About $9,500. It was signed by a doctor. So I declared it as a medical expense. This declaration was actually done on an amendment since I did not get the receipt until after I filed her T1 return. Anyway, I received a request for...
I'm witnessing a situation where a future student is enrolled in two separate RESP family plans. One subscribed by maternal grandparents and the other by paternal. So far, so good, since the child is a blood relation to each set of grandparents. Additionally each plan holds other grandchildren unique to each plan since they're only related to one set of subscriber grandparents. Also ok since each whatever plan a kid happens to be in, they're...
So I am doing the tax return for my step father. He is 87. Last year he renovated the bathroom in his house to remove a tub that was too difficult for him to get into and replace it with a shower that was also wheelchair accessible for his wife.
It appears that the expense, around $5,800 is eligible for both the medical expense tax credit AND the Federal Home Accessibility Tax credit as a Renovation and Construction Expense .
Curious to know if any members have withdrawn funds from their TD Ameritrade IRAs in recent years as Canadian residents and if so:
1) what % TD Ameritrade withheld (assuming a W-8BEN was filed)
2) whether you were able ACH to a US bank
3) whether anyone went the IRA -> RRSP route and what their experience was like
Regarding question 3 I've read a number of papers on the subject, including the SunLife one by Stuart Dollar. I assume there...
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