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Home My WebLink AboutThe Citizen, 2013-02-14, Page 7THE CITIZEN, THURSDAY, FEBRUARY 14, 2013. PAGE 7. NC –Valuable tax preparation resources are available to communities across Ontario prepared by the Certified General Accountants of Ontario www.cga- ontario.org. Here is a snapshot of tips pertaining to offset education costs now and in the future: • There is a non-refundable federal “textbook tax credit” of 15 per cent of $65, or $10, to cover each month the student is eligible to receive the full-time education tax credit and 15 per cent of $20, or $3, for each month they are eligible for a part- time education tax credit. • Parents who spend at least 12 hours per month studying in an educational program lasting at least three consecutive weeks at a secondary school, college, university or other designated educational institution, are eligible to claim expenses incurred for child care expenses while they or their spouse/common-law partner attend certain schools. • Scholarship, fellowship or bursary income with respect to post- secondary education or occupational training is fully exempt from taxation, provided it applies to enrolment in a program that entitles the student to claim the education credit. (They must be eligible to claim that education credit during the current, preceding or following taxation year.) This exemption also covers elementary and secondary school education, such as in a private school setting. Scholarship, fellowship or bursary income that doesn't meet this requirement is subject to a $500 tax-exempt ceiling. • For every dollar a parent, grandparent or other person contributes toward the RESP of a child up to 18, the federal government will contribute at least an additional 20 cents, up to an annual limit of $500 for a $2,500 contribution through the Canada education-savings grant (CESG). Special rules apply to contributions made on behalf of 16- and 17 year- olds. • Families with net family income of up to $42,707 in 2012 are entitled to a higher annual CESG grant of 40 cents for every dollar on their first $500 of RESP contributions. Families with net family income between $42,707 and $85,414 are eligible for a higher grant of 30 cents per dollar each year on their first $500 of contributions. • RESPs allow adults to grow their education savings tax free too. You can name yourself or another adult as the sole beneficiary of an RESP, as there are no age limits for RESPs established for only one individual. Continued from page 6 rented out to another farmer/producer do not qualify for this deferral. • Alternative energy projects under Ontario’s MicroFIT program have been deemed by the CRA not to be incidental farm income. Revenue and expenses related to solar and wind energy production under this program must be reported on a separate business schedule using the accrual basis of accounting. Income tax regulations relating to these can be complex so it is advisable to consult with a CGA for more details. • Because the CRA considers crop advances to be loans, in a better than average year, consider storing all or part of the crop and then taking an advance against it. This advance, which must be applied for early in the year, serves as an effective planning technique for farmers using the cash basis of accounting. NC –Valuable tax preparation resources are available to communities across Ontario prepared by the Certified General Accountants of Ontario www.cga- ontario.org. Here is a snapshot of tips to maximize pension contributions and your Registered Retirement Savings Plans: • Individuals who are paying Canada pension plan (CPP) and/or employment insurance (EI) premiums may claim a 15 per cent federal tax credit and 5.05 per cent provincial tax credit on the amount paid. • Contribute to your RRSP early in the year. If, for example, you contribute $22,970 — the maximum possible annual contribution amount for 2012 — at the beginning of the year instead of at the end, over a 25- year period, assuming a five per cent rate of return, you would have an extra $54,800 in your RRSP. • If you are an employee who is making regular RRSP contributions, request that the amount of income tax withheld on your pay cheque be reduced in order to reflect the savings those contributions will bring. This is a more efficient way to manage your money. • You don’t have to deduct an RRSP contribution in the year it is made; instead, you can carry it forward for deduction in a future period when you have income placing you in a higher tax bracket. Be sure you have used all personal tax credits before deducting your RRSP contribution. • If you are at least 65, consider creating pension income by converting part of your RRSP to a life annuity or an RRIF if your financial circumstances warrant such a move. • Contributing to a spousal RRSP also creates potential pension income for your spouse or common- law partner. • Pension income splitting can be a good strategy to minimize overall family taxes if the spouse to whom the funds are being transferred has low, or no other sources of income. • If you qualify for Canada pension plan (CPP) disability benefits, remember to check to see whether you also qualify for the federal disability tax credit (DTC). Government provides tax breaks for students Planning to retire? Here are a few tips Tips for taxes in the workplace FINANCIAL 2013 86112 St. Helen’s Line, Lucknow DOUG MILLER Certified General Accountant Accounting and tax services for: • Individuals • Farmers • Businesses • Corporations 519-528-2518 INCOME TAX SERVICE $$ • farm, business, or personal • complete year-round service including tax audit representation • E-File available Over 20 years' experience Quality work at reasonable rates "FREE CONSULTATION" Stephen Thompson R.R. #2, Clinton Home # 519-482-3244 Cell # 519-524-0957 JACQUIE GOWING ACCOUNTING SERVICE Accounting & Income Tax Preparation Monthly Bookkeeping Tailored To “YOUR” Needs • Reconciliations • Personal, Farm • Government Remittances Business & Corporate • Payroll • Electronic Tax Filing All services available on site or at our office RR 2 Bluevale 519-887-9248 Fax 519-887-9454 NC –Valuable tax preparation resources are available to communities across Ontario prepared by the Certified General Accountants of Ontario www.cga- ontario.org. Here are some tips for the workplace. • If you need to finance your business, consider establishing a line of credit with your financial institution. The interest incurred on a line of credit used exclusively to finance business purchases is tax deductible. • Carrying charges for purchasing Canada Savings Bonds (CSB) through a payroll-deduction plan are eligible for the interest expense deduction. • Flexible employee benefit programs, which allow employees to custom design their own package of health and other benefits, are popular in the workplace. Take care when structuring such plans because taxable benefits can result. If, for example, an employee accumulates flex credits and those benefits are received in cash, that amount is generally considered taxable income. • If your employer provides you with an allowance to purchase an electronic device (e.g. a tablet computer) for use at work, this amount is generally considered a taxable benefit. To avoid this, consider transferring ownership of the device to the employer and ensuring that any personal use is incidental. • Specific costs incurred by employers to improve business premises’ access for people who are disabled may be deducted in the year they are incurred and need not be capitalized. • Don’t forget to include business- storage space in the basement and elsewhere, when determining the proportion of your home used for commercial purposes. • If you convert an asset originally acquired for personal use into a business asset that is used to produce income (such as a computer), it might be possible to claim CCA based on the asset’s value at the time of conversion. A certified general accountant can help you with any valuations and calculations required. RSP Deadline February 28, 2013 Seek A Second Opinion! ENIB provides a total wealth management service. 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