Editor's Note: from http://www.taxescanada.ca/
Line 101 Employment income
Don't miss out on the following tax saving ideas:
Office in the home
Automobile expenses
Salaries paid to an assistant (your partner or child perhaps)
Supplies used to earn employment income
Automobile expenses
Salaries paid to an assistant (your partner or child perhaps)
Supplies used to earn employment income
If you already are claiming the above expenses, don't forget to see if you qualify to claim the GST rebate for the GST you paid on deductible expenses.
If you are a waiter don't forget to report your tips!
If you work on the railroad, don't forget to claim your away from home expenses.
If you paid legal fees to collect salaries or wages you may be entitled to a deduction.
Line 104 Other employment income
If you received a taxable disability payment this year, you may be able to deduct all the premiums you paid into the plan since you started contributing to the plan. You may also elect to pay CPP premiums on other employment income not otherwise pensionable.
Line 113 Old Age Security
Don't miss out on the following tax saving ideas:
Claim the Age personal tax credit if you are over 65.
Check your T4AOAS slip to see if any tax has already been withheld.
Claim the Age personal tax credit if you are over 65.
Check your T4AOAS slip to see if any tax has already been withheld.
Line 114 Canada and Quebec Pension Plan
Don't miss out on the following tax saving ideas:
Averaging the tax on lump sum CPP benefits received.
Reporting a death benefit on a separate trust return and pay less tax than on your personal return.
Averaging the tax on lump sum CPP benefits received.
Reporting a death benefit on a separate trust return and pay less tax than on your personal return.
Line 119 Employment insurance benefits
Deduct any amounts repaid to EI during the year!
Line 121 Interest and other investment income
Income splitting with your partner and children.
Investing the child tax benefit payments in your children's names.
Deducting interest expense on money borrowed to purchase investments or invest in a family business.
Deducting the interest paid to purchase Canada Savings Bonds on the payroll plan at work.
Deducting your safe deposit box fees.
Deducting accounting fees paid to calculate the investment income reported on your tax return.
Deducting the interest paid on your margin account.
Review in detail the charges on your brokerage accounts for any possible interest or other fees paid that may be deductible. Look for accrued interest charges on bonds and similar investments purchased.
Investing the child tax benefit payments in your children's names.
Deducting interest expense on money borrowed to purchase investments or invest in a family business.
Deducting the interest paid to purchase Canada Savings Bonds on the payroll plan at work.
Deducting your safe deposit box fees.
Deducting accounting fees paid to calculate the investment income reported on your tax return.
Deducting the interest paid on your margin account.
Review in detail the charges on your brokerage accounts for any possible interest or other fees paid that may be deductible. Look for accrued interest charges on bonds and similar investments purchased.
Line 126 Rental income
Claim all expenses incurred to earn rental income such as taxes, insurance, minor repairs and maintenance, interest expense and accounting fees paid to have the rental statement on your tax return prepared. Do not expense the cost of major repairs or additions to your property. Claim capital cost allowance to reduce your rental profit to zero.
Rental income is based on the accrual method and therefor any expenses incurred but not paid such as property taxes may non the less be claimed in the year to which they apply.
Consider purchasing rental property that will generate a profit in the name of the family member with the lowest net income, or consider income splitting with another family member.
Rental income is based on the accrual method and therefor any expenses incurred but not paid such as property taxes may non the less be claimed in the year to which they apply.
Consider purchasing rental property that will generate a profit in the name of the family member with the lowest net income, or consider income splitting with another family member.
Line 127 Taxable capital gains
Reduce any capital gains by any capital losses incurred in the year.
If you still have a capital gain at this point, claim any capital losses from previous years not otherwise deducted.
If you have an overall capital loss for the year, consider deducting these losses from any capital gains reported on your prior 3 year's income tax return or carry them forward until used..
If you still have a capital gain at this point, claim any capital losses from previous years not otherwise deducted.
If you have an overall capital loss for the year, consider deducting these losses from any capital gains reported on your prior 3 year's income tax return or carry them forward until used..
Line 128 Support payments received
Some child support payments are not taxable!!!
There are joint elections that can be filed to make certain support payments not taxable.
Deduct any legal fees paid to enforce the payment of taxable support payments.
If you are single or unmarried you may be entitled to claim the equivalent to married exemption for on of your children.
There are joint elections that can be filed to make certain support payments not taxable.
Deduct any legal fees paid to enforce the payment of taxable support payments.
If you are single or unmarried you may be entitled to claim the equivalent to married exemption for on of your children.
Line 129 Registered retirement savings plans
Cash in RRSP's in amounts less that $5,000 at any one time to reduce the withholding tax to 10%. Of course the balance of the tax has to be paid when the tax return for the year is filed. Spousal RRSP's are a means of shifting the tax burden from one spouse to the other.
Line 130 Other income
The first $3,000 of certain scholarships and bursaries are not taxable.
You may be able to deduct expenses against a research grant you received this year.
You may be able to deduct expenses against a research grant you received this year.
Line 135 to 143 Self employed income
Self employed individuals are entitled to claim a host of expenses as long as they are reasonable and incurred to earn income. The most common are goods purchased for resale, office supplies, consulting fees, salaries and benefits, travel, insurance, equipment rental, bank charges and repairs and maintenance.
Often missed are the entertainment expense incurred to earn income such as meals, coffee, drinks in the bar and gifts.
If you home is your main place of employment you may also be entitled to claim a portion of your occupancy expenses such as rent, mortgage interest, property taxes, insurance, utilities, telephone and minor repairs and maintenance. The portion you claim varies based upon the amount of space and time the space is used for business.
If you use your car, you my be entitled to claim a reasonable portion of gas, repairs, lease, insurance, driver's license, interest on car loans, motor league, parking, washes and 30% per year on the cost of the vehicle used.
If you partner or other family members participate in the business a reasonable salary paid may be deducted.
This may be a great tax savings strategy depending upon your circumstances. You might also consider making another family member the owner or partner in the business in order to split income.
Its also important to know when its time to incorporate and what family members to include as shareholders. There are many tax saving strategies associated with incorporating a family business and its important to get proper professional advice.
Sometimes its possible to combine a family vacation with a business trip and expense a portion of the expenses.
Often missed are the entertainment expense incurred to earn income such as meals, coffee, drinks in the bar and gifts.
If you home is your main place of employment you may also be entitled to claim a portion of your occupancy expenses such as rent, mortgage interest, property taxes, insurance, utilities, telephone and minor repairs and maintenance. The portion you claim varies based upon the amount of space and time the space is used for business.
If you use your car, you my be entitled to claim a reasonable portion of gas, repairs, lease, insurance, driver's license, interest on car loans, motor league, parking, washes and 30% per year on the cost of the vehicle used.
If you partner or other family members participate in the business a reasonable salary paid may be deducted.
This may be a great tax savings strategy depending upon your circumstances. You might also consider making another family member the owner or partner in the business in order to split income.
Its also important to know when its time to incorporate and what family members to include as shareholders. There are many tax saving strategies associated with incorporating a family business and its important to get proper professional advice.
Sometimes its possible to combine a family vacation with a business trip and expense a portion of the expenses.
Line 208 Registered retirement savings plan
Consider making your RRSP contributions now, but save claiming the deduction for when you are in a higher tax bracket.
Consider making spousal RRSP contributions.
Make an excess contribution of $2,000, but remember you may never have more than a $2,000 excess contribution at any time.
Make your RRSP contribution early in the year to take advantage of the tax free accumulation of earnings.
File income tax returns no matter how low your earned income is or how young you are to start accumulating contribution room.
If you are short on cash, consider transferring certain existing asset to your RRSP in order to obtain an RRSP deduction.
If your income will be nil or significantly less next year, buy an RRSP before March 1st., and cash it in one day later.
The contribution will be deductible this year at your marginal tax rate and taxable next year at your new marginal tax rate
Consider making spousal RRSP contributions.
Make an excess contribution of $2,000, but remember you may never have more than a $2,000 excess contribution at any time.
Make your RRSP contribution early in the year to take advantage of the tax free accumulation of earnings.
File income tax returns no matter how low your earned income is or how young you are to start accumulating contribution room.
If you are short on cash, consider transferring certain existing asset to your RRSP in order to obtain an RRSP deduction.
If your income will be nil or significantly less next year, buy an RRSP before March 1st., and cash it in one day later.
The contribution will be deductible this year at your marginal tax rate and taxable next year at your new marginal tax rate
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