TORONTO, Oct. 15 /CNW/ - It's said there are only two certainties in life - death and taxes. In a new twist on that old saying, being prepared for death may reduce your taxes.
The Ontario Government has announced that the new Harmonized Sales Tax (HST) to be implemented on July 1, 2010 will not apply to funeral and cemetery contracts signed and pre-paid prior to the implementation date. The HST will add 8% to funeral and cemetery services. However, this exemption allows consumers who sign and pre-pay for a funeral or cemetery service before July 1, 2010, to save 8% tax.
Today, funeral services are subject to the 5% GST. For example, consumers who spend $5,000 for funeral services currently pay $250 in taxes. When the HST comes into effect next year, it will add $400 to the cost of a $5,000 funeral, bringing the total taxes to $650.
"There are many sound financial, practical and emotional reasons for consumers to pre-plan their funerals," said Rene Berthiaume, Chairman, Guaranteed Funeral Deposits of Canada (Fraternal) (GFD). "Avoiding the HST on funeral expenses is a strong financial incentive. Pre-planning also provides peace of mind for consumers who know that their final wishes will be carried out with the least amount of stress for their loved ones."
Increasingly, Canadians are discovering the value of funeral and cemetery pre-planning. Last year in the province of Ontario(1):
- 87,855 people died
- 19,276 pre-paid contracts were provided
- 21.9% of funeral services were funded with pre-paid funeral contracts
- 30,024 new pre-paid funeral contracts were signed
- The average cost of funeral services was $4,475 (Includes the cost of
the funeral, visitation, body preparation and services to have the
body interred or cremated, etc. It does not include taxes or
disbursements such as death notices, flowers or cemetery charges.)
- The average cost of direct to cremation was $1,614 (Includes the
minimum services required to have the body interred or cremated.)
(1) Statistics obtained from "Ontario Funeral Sector, Quick Facts,
2008," published by the Board of Funeral Services.
"Today, many of us are planning our careers, planning for our children's education or weddings, and we are planning for our retirement," said Berthiaume. "It makes a lot of sense to pre-plan our funerals, too. With the added incentive of substantial tax savings for those who finalize funeral contracts before the HST comes into effect, pre-planning is more appealing than ever before."
Established in 1961, GFD is an independent, not-for-profit organization that administers, invests, and reports on pre-paid funeral service funds. GFD currently manages over $200 million in Trust and Insurance contracts for +350 Ontario funeral homes. GFD helps its members communicate the value of pre-planned funeral and cemetery services.
To learn more, contact Guaranteed Funeral Deposits at 1-800-268-2466, or visit www.gfd.org to find a member funeral professional in your community.
SOURCE GFD OF CANADA (FRATERNAL)
For further information: For further information: Harry Renaud, President & CAO, Guaranteed Funeral Deposits, T: 1-800-268-2466 x 225, E: firstname.lastname@example.org; Loretta Zita, Marketing and Communications Manager, Guaranteed Funeral Deposits, T: 1-800-268-2466 x 228, E: email@example.com