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Learning, Sharing, and Teaching => Ask a Mustachian => Topic started by: totoro on September 27, 2013, 04:16:31 PM

Title: Top Tax Tips for Canadians?
Post by: totoro on September 27, 2013, 04:16:31 PM
I'm not an accountant but I have benefited from some tax rules. 

If you have some tax planning strategy or deductions that have been helpful in reducing your tax rate maybe you can post them? 

For us, a home office and a suite in our primary residence have been helpful because we can deduct mortgage interest based on the % of floor space used as a rental/office and all direct expenses.   We don't claim capital cost allowance on the property because we would like to maintain our capital gains tax exemption to the extent possible.  If your rental is furnished you can write off a depreciation amount each year.

In order to preserve the CCA on a principal residence:
•your rental or business use of the property is relatively small in relation to its use as your principal residence;
•you do not make any structural changes to the property to make it more suitable for rental or business purposes; and
•you do not deduct any CCA on the part you are using for rental or business purposes.

Here is a link to more info (see comments):
http://www.milliondollarjourney.com/rental-property-income-taxes-and-deductions.htm

And the CRA guide:
http://www.cra-arc.gc.ca/E/pub/tg/t4036/t4036-e.html
Title: Re: Top Tax Tips for Canadians?
Post by: Kazimieras on September 30, 2013, 01:38:28 PM
So here is some stuff I try to follow:
Title: Re: Top Tax Tips for Canadians?
Post by: totoro on September 30, 2013, 09:32:13 PM
You know what is awesome - you Kazimieras!  Those are great tips.  And difficult to grasp for someone just starting out.

I have read a couple of tax books and agree they help.

I think for me the other thing that has been extremely helpful is being self-employed and owning a corporation.  Dividends can be very good things.

Couple of other links:
http://www.canadianbusiness.com/investing/when-business-owners-should-and-shouldnt-make-rrsp-contributions-2/
http://www.ica.bc.ca/kb.php3?catid=1236&mobileSession=af3ffcfdad1454b19a1ae437ea7f8824