Family Debt-to-Income Ratio Hits Record

Family Debt-to-Income Ratio Hits RecordThe average family debt-to-income ratio in Canada has now hit a record 150 per cent, the Vanier Institute of the Family said Thursday. That means for every $1,000 in after-tax income, Canadian families owe $1,500, the institute said, while releasing its 12th annual assessment of Canadian family finances. It found the average family borrowing — including mortgage debt — now totals $100,000. The Ottawa-based institute, which describes itself as a…

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Taxing the Rich

Taxing the RichA reader of this blog, Chris, posed the following thoughtful question: What do you think the implications would be if Canada were to implement more tax brackets? For example, if federal tax tiers were added at $200k and $300k with a federal rate of say 33% and 37% respectively? I’m not sure why the government hasn’t gone in this direction because the majority of voters are not anywhere near these…

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Should I Start the Smith Manoeuvre?

Should I Start the Smith Manoeuvre?As this blog has quite a bit of content regarding the Smith Manoeuvre, I often get reader questions regarding how to start the Smith Manoeuvre, and when is a good time to start.  I have answered the “how” in the past, but what about the “when”? What is the Smith Manoeuvre Before we get started, lets take a couple steps back and explain what the Smith Manoeuvre is to newer…

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HST Arrives in Ontario

HST Arrives in OntarioWell, actually it doesn’t start until July 1st, 2010 but knowing about this new tax is just as important as its announcement.  The HST tax, or Harmonized Sales Tax (combining the GST & PST together into one tax) is Ontario’s answer to the mess of the having these two separate taxes for so long. Complaints have already begun about how our costs will be going up. For some people it…

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Eldercare

EldercareReader submitted question: Q – Me, my sister and my uncle are sharing the cost of keeping my father housed in a care facility because his gov’t monies & pension do not cover the monthly fee. My understanding is that we cannot claim our contributions because my father is not a dependent who resides with any of us. Is this true? Thanks! Answer provided by Intuit’s Ask A Task Expert:…

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Adopted recently? This tax tips for you.

Adopted recently? This tax tips for you.If you’ve recently adopted, or know anyone who has, this Canadian tax advice is for you, courtesy of Intuit (think: QuickTax) Here was the original reader-submitted question: Q – Is there an adoption expenses tax credit? We adopted in 2009 and have paid various expenses to an adoption agency, are any of them tax deductible? Our adoption will be finalized in 2010. And the answer, supplied by Caroline on the…

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Dealing with the Canada Revenue Agency

Dealing with the Canada Revenue AgencyHere are two stories that show how important it is to know how much tax you owe and pay the right amount. If you don’t, the government can hit you with heavy penalties. In the first case, a woman sent a cheque for what she thought she owed. The Canada Revenue Agency didn’t cash her cheque and sent her a big refund in error. Many months later, it demanded repayment,…

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How To Fix Errors On Old Tax Return Plus Claim Your Kids Deduction

How To Fix Errors On Old Tax Return Plus Claim Your Kids DeductionThanks to commenter David on my recent QuickTax software review, I learned that you can claim your kids and I now need to refile my tax returns for the last two years.  It is on the federal TD1 form and is plain as day (now that I look at it). So much for saving money by doing my taxes myself!  Mr. Cheap has asked me a few times if I’ve…

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What Can I Deduct to Pay Less Tax? File Your Income Tax with QuickTax Review

What Can I Deduct to Pay Less Tax? File Your Income Tax with QuickTax ReviewNow that we have almost completed the RRSP season for the 2009 income tax year, it is now time to think about one of the most painful financial activities: file taxes! I’ve recently been contacted by Intuit (the famous producer of Quicken) to review their latest QuickTax 2009 income tax software. So they sent me a QuickTax 2009 standard edition so I can work with it for a while and…

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The sad fate of labour-sponsored funds

The sad fate of labour-sponsored fundsRemember when all you heard from investment salespeople during the RRSP season was about the 30 per cent tax credits available on a labour-sponsored fund? Sometimes, they added the RRSP deduction and showed how 75 to 80 per cent of your contribution was subsidized. Sounded like a great deal, right? But did they also mention the sky high management fees or the fact that a portfolio of emerging businesses might…

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