INTRODUCTION

OVERVIEW

Have you ever complained about paying tax? You may not love it, but paying tax really is worth the pain.

We may grumble about paying taxes but, for the most part, we accept it as a necessary evil. Put to proper use, taxes pay for those services we want, use and need to function in our day-to-day lives. Without taxes, governments wouldn’t have the money to build roads, educate our children, provide health care, pay firefighters and keep us safe.

However, there’s no reason to pay more tax than absolutely necessary. Even the courts agree that you are allowed to arrange your affairs to keep taxes as low as possible. Use this section of the ProsperiGuide website, Tax, to explore the basics and discover ways to reduce your annual tax burden. We’ll show you strategies and legitimate opportunities to reduce your tax bill, today and in the future.

In Tax, we will discuss:

Tax basics: tax planning, rates, deductions and credits.
Registered savings vehicles: RRSPs, Pensions, TFSAs, RESPs and more.
Tax for families: tax deductions, credits and income splitting opportunities for couples and parents.
Investing and the taxman: investment income and tax-efficient portfolios.
Tax in retirement: tax credits, income splitting opportunities and tax tips.
Tax and life events: strategies and resources.

The progressive tax system we have in Canada works on the principal that the more we earn, the more we pay. Every province and territory layers its set of tax rates on top of the federal rates. Check out the information on marginal tax rates and review the combined federal-provincial/territorial tax rates to find how much tax you (and your spouse/partner) will pay.

There’s more. The taxes we pay, or the credits we get back, are dependent on many factors such as our:

Age
Job type
Marital status
Whether we have children (minors or adults)
Lifestyle and life events, from buying a house to donating to charity
Investment portfolio: both the types of accounts and the securities we own

There are winners and losers in the tax arena. Some households have many ways to reduce tax while others don’t. No matter, develop a good grasp of tax facts, learn to recognize tax triggers and check out the tax implications of significant life events. Don’t miss out on tax breaks or pay more tax than is necessary.

Tax Basics

Do you know your marginal tax rate? Are you taking advantage of every deduction and credit to which you’re entitled?

Registered Savings Vehicles

Living costs money. We want to buy things, go places, educate our children and be financially independent one day (not having to work to fund our lifestyles).

Tax for Families

Families come in many shapes and sizes. They also may enjoy opportunities to save tax or get free money from the government.

Investing & the Taxman

While less important than your investment time horizon, risk tolerance and risk capacity, tax is an important consideration to keep in mind.

Tax In Retirement

Retirement is a time of change. The only good thing about your new, and likely lower level of income, is the lower marginal tax rate (MTR) that goes along with it.

Tax & Life Events

Tax planning is a key plank of our financial plan. However, life events have a way of disrupting our plan. When a major life event is upon you, don’t forget the tax implications.

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Tax