TORONTO, Feb. 3 /CNW/ - As Canadians go about preparing their tax
returns, author and tax expert Evelyn Jacks has provided nine tips that can
help relieve their stress - and save them money.
"Taxes - not volatile markets - are the biggest destroyer of Canadians'
wealth," says Jacks, founder and president of The Knowledge Bureau, a leading
Canadian financial services institute. To mark the official launch today of
her newest book, Master Your Taxes: How to Maximize your After-tax Returns,
Jacks has provided Canadians with her top nine tax tips for 2009 - and beyond.
1. Take control
Real wealth management is the accumulation, growth, preservation and
transition of personal net worth - after tax, costs and inflation. Mastering
your taxes, the largest destroyer of wealth, will help you become richer.
Decide now that you're going to get a handle on your taxes.
2. Shift your focus
If taxes are mystical to you, learn enough to ask deep, probing questions
about your after-tax results. Shift your focus from annual tax preparation to
a strategic plan for tax efficiency - all year long.
3. Stop the madness
The average tax refund in Canada has climbed to more than $1,400. That's
an interest free loan to the government. Change the game - pay only the right
amount of tax, but on time, not in advance. Minimize the taxes withheld at
source. Ask your employer for a copy of Form TD1 Tax Credit Return and its
sister, Form T1213 Request for Reduction of Taxes at Source.
4. Consider variety
A variety of income sources may bring better after-tax results. It's
important to keep on top of marginal tax rates - by income source - to average
down the taxes you pay. Find out how much you'll pay on the next dollar of
income you'll earn, by source. Interest income, for example, will be taxed at
a top marginal rate (around 45 per cent for upper earners) while income
resulting from capital gains attracts half that amount.
5. Take the team approach
Refuse to deal with professional advisors who work in silos - a team
approach is best. Make sure your financial and tax advisors are working
together to create and preserve your wealth.
6. Make it a family affair
Through income-splitting, families can pay the least amount of taxes
possible and build significantly more wealth than single people. The family
can be a powerful economic unit.
7. Consider self-employment
If you don't own a business, consider starting one, even a part-time
operation. There are decided tax advantages to self-employment, because your
business will likely pay much lower taxes than you do personally.
8. Focus on the outcome
What counts is what's left. What can you still do to reduce the taxes
you'll pay? Are you claiming all the deductions and credits you're entitled
to? Don't be reluctant to ask questions - of your advisor, of your tax
preparer, of the Canada Revenue Agency - to fully maximize your after-tax
9. Never miss filing a tax return
A tax return is required to build contribution room for the Tax Free
Savings Account (TFSA) and Registered Retirement Savings Account (RRSP), so
it's folly to miss filing a return, or to file late. Don't cut into your tax
exempt and tax deferred wealth accumulation potential by being tardy. Increase
your tax refund with an RRSP, and use the savings to fund the TFSA.
Master Your Taxes, Jacks' 42nd book, is the first in the new Master Your
Personal Finances books, published by The Knowledge Bureau.
The Knowledge Bureau is a national certified post-secondary educational
institute, which provides continuing professional development to practicing
professionals in tax and financial services leading to certification and
designation. For more information, please visit www.knowledgebureau.com.
Evelyn Jacks is available for interviews on February 4th and 5th.
For further information:
For further information: To arrange an interview or to receive further
information, please contact Kerry Breeze at (416) 829-1727,