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Stay On Track of Holiday Spending

With only 8 weeks left for holiday gift buying, shoppers everywhere are flooding the stores looking for that perfect gift. If you’re like me, you start each holiday season with the best intentions by making a list that you swear you’re going to stick to. Procrastination and busy schedules however keep us from sticking to our holiday shopping goals and we resort to last minute purchases that push our budgets over the edge.  If you’ve created a budget for yourself throughout the year and want to stay on track of your holiday spending you can do it with a little planning and these five helpful tips:

 

  1. SETTING LIMITS ON HOLIDAY SPENDING

 

Yes – we all want to buy our friends and family gifts they’ll really love but that doesn’t mean breaking the bank. Give your credit cards and bank balance a break by setting a limit to what you can spend. Create a mini holiday budget based on your household budget.  If you don’t have a budget in place,  apps like Mint and You Need A Budget are a great place to get started and help you determine what you can afford.

 

  1. MAKE A LIST AND CHECK IT TWICE

 

Yes – the mail carrier is a nice guy cause and the security guard at work always has a smile for you but that doesn’t mean they have to be on your gift buying list.  You’re not Santa Claus.  You have a finite budget and can only really afford to buy gifts for those individuals you’re really close to.  If you have more than 7 names on your list do some editing and cut it down to 5. You can still give to other people in your life but it doesn’t have to cost a lot of money. With a little imagination you can show people you care about them without breaking the bank.  The holidays are about spending time with friends and family not about spending.

 

  1. SPEND BASED ON WHAT YOU CAN AFFORD

 

We all have that wealthy aunt or sibling who outdoes everyone every year with their gift giving. But just because they are in a financial position to purchase expensive gifts doesn’t mean you are. Keep your shopping to items you can afford and that fit your own finances. After all, it isn’t the gift that matters but the thought. Keeping your cash flow positive at this time of the year will have it’s rewards in the new year when the credit card bills start to roll in.

 

  1. STARTING EARLY WILL ELIMINATE IMPULSE BUYS

 

Search the internet for sales and coupons on items you’re looking to buy.  Online shopping is a great way to avoid the last minute shopping craze in crowded malls and you can do it from anywhere and at anytime. Before you shop in local stores, comb through the coupons you received in your mailbox before hitting the mall. These tactics will not only help you stay on track but will make gift buying easier.

 

  1. GIFT OUTSIDE THE BOX

 

It’s not always about the size of the gift box or the price on the tag. Sometimes the best gift of all is your time. Think about all the people you’ve neglected over the year. Not because you want to but because you’re too busy or you don’t live close by. Spending time with friends and family in a meaningful way goes well beyond the holiday moment. A heartfelt gesture to your nana in the nursing home is a gift that will reward the gift giver and the recipient. Volunteering at a soup kitchen or homeless shelter are just a couple of ways you can make a difference without spending a cent.

 

SPENDING TIME – NOT MONEY

Lastly, remember that the holidays are a time to rejoice in the friends and family we have with us. You want to enjoy this time of the year not stress over how you’ll manage to pay your credit card bill when it arrives. Keep to your budget, give yourself time, get organized and you’ll be in a great financial position to start off the new year.

tax-preparation-services-canada

Make Note of these Important Tax Changes for 2017

Every year there are changes to the Canadian tax season. Do you know the 2017 updates? This year there are changes for families, interest, investments, and tax law so buckle up and we’ll review everything that you should be aware of for the 2017 tax season.

What’s New for Families?

If you’re responsible for your family’s taxes, you’ll want to know about the following benefits, deductions, and credits for the 2016 income tax year. What, more to think about? With kids and a million little things on the go, we’d like to remind you that, when you file your taxes with TAXplan, our TAXpros will take care of the details to ensure that your family doesn’t miss any applicable tax credits or deductions.

The Canada Child Benefit (CCB)

The Canada Child Tax Benefit (CCTB) came into effect on July 20th, 2016. It’s replaced the Universal child care benefit (UCCB) and National Child Benefit Supplement (NCBS), and is designed to help eligible families with the cost of raising kids under the age of 18.

The CCB is a tax-free monthly payment that’s calculated using the adjusted family net income from your previous year’s income tax return. You’re required to file annually to receive the benefit. If you haven’t filed your 2015 return, you may miss out on these payments if you’re eligible.

Children’s Fitness and Arts Tax Credits

Unfortunately, the children’s fitness tax credit has been reduced to $500 from $1,000, and the children’s arts tax credit has been reduced to $250 from $500. Sad but true, however the additional amount of $500 available to children eligible for the disability tax credit isn’t changing.

Important note: these amounts are refundable in 2016, however in 2017 and subsequent tax years, both credits have been removed. If this is confusing, don’t hesitate to connect with a TAXpro who will make sure that everything is optimized for your family.

Child Care Expenses

The maximum limit for child care expenses hasn’t changed for 2016. Here’s a brief overview of the deduction limits based on your child’s age at the end of the applicable tax year:

  • Children 6 years and under, you can deduct $8,000 annually;
  • Children between the ages of 7 and 15, you can deduct $5,000 annually; and
  • Children eligible for the disability tax credit have an annual limit of $11,000.

Family Tax Cut

The family tax cut, also known as the income splitting tax credit, has been eliminated for 2016 and subsequent tax years. This doesn’t apply to you if you receive a pension; you may still be able to reduce your taxes on eligible pension income by splitting with your spouse or common-law partner.

News for Interest and Investments

Take note of the following changes for investments and interest for your 2016 income tax year. Remember that when you file with TAXplan, our TAXpros will ensure that all of deductions and credits are accounted for and that your tax return is optimized for the best possible results.

Tax-Free Savings Account (TFSA)

It’s important to note that the annual TFSA dollar limit has been reduced in 2016 to $5,500.

Other Deductions

The minimum withdrawal amounts for the following funds and plans have not changed for 2016:

  • registered retirement income fund (RRIF)
  • registered pension plan (RPP)
  • pooled registered pension plan (PRPP)

For more information see Guide T4040, RRSPs and Other Registered Plans for Retirement.

Interest Paid on your Student Loans

Still paying off student loans? Here’s some good news. If you paid any interest on your student loan in 2016, you may be able to claim it. Follow this link to learn more or use the TAXplan app (free for students!*) and a TAXpro will take care of it for you.

Other News and Updates

Home Accessibility Tax Credit (HATC)

If you and your home qualify, you might be able to claim a non-refundable tax credit in 2016 for certain expenses paid to renovate your home. Review the home accessibility expenses information on the CRA website for all the details.

New Reporting Requirement on the Sale of your Principal Residence

In 2016 and going forward, you’ll need to report basic information regarding the sale of your principal residence. This information includes when you originally purchased the home, how much it was sold for, and the home address. You’re not required to pay capital gains on the sale of your principal residence if you didn’t use any part the home to earn money. Learn more about this important reporting requirement here.

Tax Credit for Educator School Supplies

Are you a teacher? If you’re an eligible educator, you may be able to receive a tax credit on qualifying teaching supplies bought throughout the tax year. It’s a step in the right direction. The 15% refundable tax credit is calculated on up to $1,000 in expenses. This tax credit is applicable to teachers and early childhood educators. Review the CRA publication to learn if you’re eligible.

Never Miss a Tax Credit

With so many changes to this year’s tax guidelines, we highly recommend that you entrust your 2016 online tax return to a professional. Consider TAXplan. We make your life easier by allowing you to submit your tax information in a convenient app for it to be processed, optimized, and filed by a professional. Click here to start now.

Mark your Calendar with these Important 2017 Tax Dates in Canada

Canadian tax season has arrived! Not feeling excited yet? Well maybe this post will start a little fire underneath you to get you ready to file your 2016 income tax return.

Before we get started, there have been cases of fraudulent phone calls and scam emails pretending to be from the Canadian Revenue Agency. They’re not. Be on guard. If you’re contacted by a source claiming to be the CRA, don’t reply before checking this information first.

2017 Income Taxes Deadline

The official due date for individuals to file is April 30th but because the 30th falls on a Sunday this year, you get an extra day. Your return and any amount owing are considered on time if postmarked by 11:59pm on May 1st, 2017. Not that we’re advising you to wait until the last minute. There are a lot of advantages to filing early!

April 30th, 2017 = May 1st, 2017

While the due date for the Canada Revenue Agency (CRA) isn’t until the first of May, you can file your tax return as soon as you have all of your tax slips and information available. It’s worth it to get a head start on the filing will avoid rushing at the last minute to submit your return.

Seriously, don’t delay filing! Late payment on taxes owing just means fees and penalties… And if you’re expecting money back this year, why not get your taxes in early and enjoy the extra cash back in your pocket? Exactly. Get started now.

Online filing is definitely the fastest and easiest ways to complete your return. You should check out our TAXplan App; it allows you to submit all of your information digitally and then a tax professional will optimize your information submit your taxes for you. Filing on time with TAXplan is an ideal way to minimize how much you have to pay, and maximize how much you’ll get back!

TAXplanning Tip: If you’re receiving cash back from your 2016 return, consider rolling that money right into an RRSP for 2017.

Self-Employed Deadline

If you or your spouse/common-law partner are self-employed, your tax timeline will be a bit different: June 15th, 2017. But keep in mind that any amount owing on your personal return is still due by 11:59 am on May 1st, 2017.

Also, depending on your annual income, you may have to make tax installments throughout the year.

Penalty Warning: Repeated Failure to Report Income

No funny stuff. Be sure all of your income is accurately accounted for. If fail to report on income and it amounts to $500 or more, you can be charged a penalty and the specific penalties have now changed. Interest and penalties are calculated on a daily basis and they can add up quickly!

Don’t get caught paying more than you need to: report all of your income thoroughly and carefully. The TAXplan app will help you report your income easily and accurately, and your file is always checked and optimized by a TAXpro. Get started now.

RRSP Deadline

Have you considered contributing to a Registered Retirement Savings Plan (RRSP)? It’s one of the of best ways to save money on your personal tax. The great thing about an RRSP is that you save on any taxes owing today while also putting money into a secure investment that will help you save money for your future.

Contribution Limits

  • 18% of your earned income in 2015; or
  • $25,370 – the 2016 tax year maximum contribution amount.

The timeline for RRSP contributions is 60 days after year end. That means that you still have time to make RRSP contributions to offset 2016 taxes, but time is running out! The RRSP deadline is March 1st, 2017.

Summary

So in summary, the important 2017 tax dates in Canada are:

  • March 1st, 2017 – RRSP deadline
  • May 1st, 2017 – Income Tax deadline
  • June 15th, 2017- Self-Employed Tax deadline

Just remember that the best way to file your taxes this year is to work with a tax professional. It’s also the best way to ensure that you’re optimizing your financial situation for the most strategic and beneficial tax outcome. The most convenient and cost-effective way to submit your taxes to a professional is by using the TAXplan app. It’s the only app in Canada that connects you with professionals–TAXpros–who know the ins and outs of the Canadian tax laws and regulations. Our TAXpros will ensure that you get the most money back and pay the least amount of taxes possible every time. Click here to get started now.