Archive for February 7th, 2012

2012
07
Feb

How to save on taxes

Posted in Tax Accountant

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Tax Accountant Mississauga – How to Save Taxes

Are you paying too much tax? As a tax accountant, I can reduce the tax you pay or get your higher refund. There are several tax strategies available to reduce the taxes payable by individuals, business owners and investors. The following are some of the strategies to reduce the personal tax.

1) Professional Fees

Fees paid to a professional association is deductible to reduce your income. For example fees paid to Institution of Engineers of Ontario, Ontario Nursers Association, Royal College of Physicians and Surgeons Of Canada and many other association fees are deductible.

2) RRSP contribution

Contributing to your RRSP in most cases is recommended, not just to reduce the taxes you pay, but for retirement planning purpose. However, this is not or everyone. You are encouraged to talk to your Tax Accountant to find out if this investment vehicle is suitable for you.

3) Making your interest payments tax deductible

Interest on money borrowed for investment purpose is deductible against your income. Do you have investments in a non registered account (ie. outside your RRSP)? It may be possible to restructure the investments so that the interest expense is tax deductible. It is also possible to convert your mortgage into a tax deductible strategy commonly known as Smith Maneuver. You should consult with your Tax Accountant to determine if you can restructure your investments so that the interest can be deductible.

4) Donate to your favorite Charity

If you do not pay taxes, this strategy will not be helpful as this will not reduce your income, but you will get tax credit for your donation. Generally you will get about 40% of the amount you donate to a Charity. The Charity must have been registered with Canada Revenue Agency and the receipt should indicate the Charity registration number. There are also a host of foreign charities that you can donate. Remember to check with your Tax Accountant to determine if your favorite foreign charity is eligible for donation tax credit.

5) Tuition Payments

If you incur tuition fees paid to a post secondary college or University, you can claim a tax credit for the tuition fees. In addition you can get tax credit for additional $400 per each month you were studying as well as $20 per month for text book.

If you pay examination fees paid to take an occupational, trade or professional examination that is required to obtain a professional status is deductible from the 2011 year onwards.

Further the minimum duration of courses taken at a university outside Canada has been reduced to three consecutive weeks from 13 weeks.

About the Author – Tax Accountant Mississauga

The author is a Tax Accountant in Mississauga, Ontario, Canada.  He enjoys working with individuals, small business owners  and investors.

While his expertise is in the area of taxation, his accounting firm, Tax One Centre offers many services, including wealth planning, retirement planning, corporate tax return, government grants and tax credit applications, personal tax return and tax advice.

If you want to find out how you can reduce your corporate or personal taxes that you pay, call us at 905-564-6277 for a Free Initial Consultation.


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