Canadian Personal Finance Blog

Archive for the ‘CCPA’ Category

During a week where the federal government disclosed just how enormous the federal budget deficit will be, there were other topics written about by the Financial Blogging world, but this topic alone is a pretty hot topic. 

What could that kind of “money printing” cause in the economy? Jon Chevreau points out in the U.S. it could mean Hyperinflation on the Zimbabwean scale (at least in Dr. Doom’s estimation at least). 

Random Thoughts: Pensions?

• Michael James points out that not only is Nortel not paying severance and cutting their pension pay outs, they are reneging on work already done in Nortel Pensions and Paying in Advance.
• The Canadian Capitalist writes about the Major Changes in the Canada Pension Plan, which in some ways may be good, but are they?
• Preet at Where Does All My Money Go, points out there are hidden fees everywhere in Hard to Borrow Fees. 
• Canadian Financial DIY writes about our aging population and points out that 80 is the new 65 , yikes!
• The Four Pillars celebrated their 2nd blog Birthday, good for them, keep up the good work.
• Larry MacDonald asks about Falling House Prices and Banks, another interesting topic.
• Riscario Insider points out even Billionaires Need Government support.
• Gail Vaz Oxlade points out that spending Cash may cut spending in Cash versus Credit . 

Have a great weekend folks, hopefully the rain will stop, but maybe my grass needs it?

April 30th (Canadian Income Tax deadline (CRA)) is starting to loom on the event horizon and for me that means paying a hefty 5 figure Income Tax bill (due to my severance payment not being taxed at the correct level). This will (hopefully) be the largest tax over-payment I need to make in my life (but who knows).  

Since I owe the government money I have filed my tax return, but I am waiting to make my payment until the end of the month (no point in giving the government any extra funds), which I will do using my Bank’s Direct Bill Payment capability.

Due to this very large bill, I have managed to find and work as many deduction and tax credit areas as I can legally think of (aside from claiming my cats as dependants, which is in the illegal side of the equation).

Some of the more important areas that I was able to take advantage of:

1. Soaking up all remaining RRSP room that I had to lower my tax payment (along with the allowance given to me for having worked for the same company between ‘85 and ‘94).
2. Ensuring I transfer over my daughter’s tuition fee deduction (she did not need it).
3. Mass transit tax credit, using the bus passes I buy my daughters to lower my taxes
4. Active Children tax credit, for two of my daughters
5. Safety Deposit box rental as a carrying charge
6. Making sure I have all of my Charitable Donations in place
7. Filling in my tax forms correctly, thanks to Quicktax (I am sure UFile would have done the same)

These and other important tax deductions and credits have helped soften a large blow to someone with no income for now either.

However, as all of these stories go, there are people worse off than I am:

1. Former co-workers who got no severance, so I am not complaining about paying a lot of tax, because it means I did get some money.
2. Other folks due to circumstance who are going to owe much more than me (see Michael James post on Phantom Income Strikes). 

Remember when you pay that big tax bill there are others worse off, so calm down and get it done, April 30th is not that far away!

Where has all the money gone?

So this topic comes from a comment from my friend Michael James on commenting on my “self pitying” posting of getting older yesterday. The quip is actually quite topical, I have earned well over a million dollars in my 20+ years of working. Where did all that money go?

If you think about it, where it always goes:

• Taxes
  • Federal Taxes which had to have eaten 10-20% of it over the years
  • Provincial Taxes which ate about the same if not a little less
  • GST and PST can’t even fathom how much I have paid for those little consumption taxes.
  • Municipal Property Taxes, which keep going up as well. How much? 4-8% of my income is a good guess.
  • Employment Insurance payments, and I have never claimed against this system (touch wood). That is money completely lost.
  • Canada Pension Plan Payments (and a little QPP as well), hopefully I’ll get some of that back one day.

  That’s about 25-45% of the money right there, and I haven’t spent a cent yet!

• Living, which might include rent and mortgage payments and such, which has to be about 10-20% of that money.

So I have about 40% of my income left and I haven’t fed anyone, bought a single coffee or gone on a wild spending binge?

It’s interesting just to look back and if I told myself when I started working that I’d have earned over a million dollars by now, but not be living in a villa on the Riviera, I don’t think my younger self would have believed it.

Tax Preparation Coming

It is that time of the year to start looking at tax software and start monkeying around with my taxes. Our friend the Canadian Capitalist is looking at Ufile instead of Quicktax this year. Quicktax seems to be cutting the number of possible returns to be done down to TWO (2) but I need to research this more to figure out whether I can use this or not, given my oldest daughter now is old enough and has income. Stay tuned, I am sure I will rant more about this topic very soon.

Move Complete

My Blogspot account is now permanently aimed at this site. The move over is complete, I hope.

Our friends over at the Fraser Institute helps you figure out when you stop working for the government, and start earning money for you (figuratively speaking of course, since you’ve either died or been evicted if you’ve only been giving your money to the government).

What will you do with this new Freedom?

Go, sons (and daughters) of Canada, and Calculate Your Tax Freedom Day!!!!!!! and what will you do with that Freedom? Maybe go and buy a copy of Braveheart? Or Borrow it from the Library?

I forgot to remind you yesterday, “Sorry ’bout that chief!” (to quote Maxwell Smart), but if you owed money (in Canada) you needed to have your tax return in the mail by midnight last night. In Ottawa we have the luxury of having a tax office here, so I think they have someone picking up ’til midnight, so for all you procrastinators, you could have got it in last night! Now remember that deadline is if you OWE money to the government, if you don’t the tax folks don’t really care (especially if they owe you money), but if the government owes you money, why wouldn’t you want it?I always thought a shoe phone might be a great invention to try to sell as a novelty, but I suspect that there is a patent on it already.

Given we tried to limit our eating in restaurants this past weekend, Stats Canada has just published is topical: Sales in Restaurants and that ilk of business is up 2.4% over last year at this time. Good for the Food Services industry! Always glad to see a business continue to flourish, however, folks, that’s your money. Eating out is one of the biggest “luxury” expenses all families have (including my own) and one of the areas where you should control your spending. Growing up I remember going out for dinner or ordering in being something “special”, it just doesn’t seem to be any more, for our generation (yes I am very old too).