NEWSLETTER

Greetings!

This monthly Newsletter provides  business,  financial  planning and tax information  to clients and friends of our firm.  Any of the general information  contained in this Newsletter should not be acted upon without first determining  its application  to your specific situation.  Contact our office if you have any questions or concerns.

Pay your next personal income tax installment on time - March 15 is the due date. If you expect lower income in 2012, you can reduce the amount requested by the Canada Revenue Agency (CRA). If CRA has not notified you, consider deferring your payment until you receive notification (and then only if the amount is less than the expected income tax for the year - otherwise consider reducing this one too).

Start gathering information for your personal tax return. Working on it now, rather than at the last minute, reduces the risk of error and missed opportunity.

If you have a child in a foreign university, obtain the correct form to allow you to claim the tuition fees paid. One of the following tax forms must be completed and certified by a qualified foreign educational institution to support any claim for the Canadian tuition, education, and textbook amounts:

Form TL11A Tuition, Education, and Textbook Amounts Certificate - University Outside Canada

Form TL11C Tuition, Education, and Textbook Amounts Certificate - Commuter to the United States

Form TL11D Tuition Fees Certificate - Educational Institutions Outside Canada for a Deemed Resident of Canada

Review your family income situation for income splitting opportunities.  Reasonable wages paid to children are still allowed.

Review your investment mix with your advisor.  Declining interest rates mean less income earned.  More favourable tax rates on capital gains, and possibly an economy getting ready to grow again, suggests looking at equities.

Cut all unnecessary expenses.  This may not save you tax, but it will save some money.  It is surprising how many small (and unnecessary) expenditures there are.  Plan to cut one per month for the balance of the year.

Review your plans for medical expenses for the balance of the year.  Many medical expenses previously thought non-deductible are now being accepted by the courts.  The general rule is the treatment must be prescribed by a medical practitioner.  Passing this test usually makes the expense eligible for a tax credit.

Start a Registered Education Savings Plan (RESP) for your child.  The government kicks in a tax-free grant that is hard to pass up.  Start as soon as your child is born.  

Credit agencies track how you handle your financial obligations.  Most of the reporting is done by large institutions like banks, major retailers and car companies.  Some key things they track are:

• Whether payments are made on time - including the date and how many days late you were paying;
• Debts not paid;
• Credit limits or loan amounts;
• Names of people who searched your credit history;
• Name, address, date of birth, employer name, occupation, previous addresses, previous employers and other names used (even if the supplier of the information entered your name incorrectly).   

Once our office has completed your year end file we can send you the QuickBooks import file.  To import  accountant's changes in QuickBooks, please follow these instructions:  

1. Open your company QuickBooks data file;
2. Select File; Accountant's Copy/Review; Import Accountant's Changes (Note:  Only the user with the rights to log in as ADMIN will be able to import the changes and later set the closing date to protect these changes from future modification.)
3. Select the accountant's change file sent to you by us.  Click on OK.   
4. As a precaution, QuickBooks will prompt you to make a backup of the data prior to performing the import.  

February 29

RRSP contribution deadline