The Citizen, 1999-02-10, Page 23THE CITIZEN, WEDNESDAY, FEBRUARY 10, 1999. PAGE 23.
Gov’t makes health benefits sweet deal
(NC)—Intended as a sweet deal
to put money back into our pockets,
the current federal budget is
making the benefits of
supplementary health insurance
impossible to ignore.
Since February, 1998, self-
employed, unincorporated
Canadians have been deducting the
cost of supplementary health and
dental coverage from their business
income. For those who are an
employee of their own business, the
plan is designed to be a non-taxable
benefit for you individually, and, a
tax-deductible expense for your
business. For others, the premiums
qualify as a fnedical expense which
may create a tax credit.
This bold, new federal budget
measure has succeeded in leveling
Four tips to saving success
the playing field for all self-
employed Canadians. Better still,
with the financial burden of
national health care shifted toward
the private sector, the tax
deduction, they point out, is a win
win situation because premiums
paid toward individual health care
can now be deducted from business
income, while at the same time
offering peace of mind.
To qualify as a tax-deductible
expense, the following conditions
must be met:
• The individual must be actively
engaged alone or as a partner in his
or her business.
• Self-employment must be the
individual's primary source of
income (50 per cent or more each
year) or income from other sources
cannot exceed $10,000.
• Equivalent coverage must be
extended to all full-time, arms-
length employees of the individual.
• Premiums will be deductible to
a maximum of $1,500 each, for the
individual and spouse and $750 per
child.
• Limitations can be reduced to
nil depending on number of
employees receiving coverage.
• Premiums are only deductible if
the plan is purchased from a third
party in the business of selling
insurance or if the plan is operated
by a trustee that is in the business
of operating such plans.
• Where the deduction is claimed,
the amount does not also qualify
for the medical tax credit.
“It’s quite conceivable,” says
Domenic Servideo, Business
Manager for Liberty Health, “that
subscribers under these new
guidelines, could get complete,
extended health coverage each year
at virtually no cost at all. Our plan,
for example, could flush-out
something like this:”
• A typical Liberty Health
premium $ 800.00
• Tax saving at 40 percent
level - 320.00
• Then, typical claims per year
might be:
• Prescription drugs - 80.00
•Dental -150.00
• Vision claims - 150.00
• Chiropractor/Registered
Massage Therapist - 100.00
$ 00.00
For clarification or more
information on how to get started
with health care coverage, call 1-
800-COVER ME® (1-800-268-
3763), or access the Liberty Health
website at WWW.COVER-
ME.COM
- News Canada
Eliminate Your
Headaches!
Call now to have us do
your Personal or
Business Taxes!
C.A.M.C.
Bookkeeping & Income
Tax Service Inc.
329 Edward St.,
Wingham
357-3687
(NC)—We can fool ourselves
most of the year, but when it comes
to income tax time the truth is all
too uncomfortably right in front of
us: another year has come and gone
and we still haven’t put aside
enough savings to prepare for our
retirement.
However, by wisely investing
what we have been able to save, we
can go a long way towards reaching
our retirement goals. And by
following a few simple steps
throughout the next year, we can
achieve higher returns.
1. Review your personal
investment goals
Your personal investment goals
are yours alone. You have your
own timelines in mind, your own
risk tolerance, your own reasons for
investing. You know your specific
financial resources, and your level
of understanding when it comes to
investment products.
Perhaps most important of all,
you should know your ultimate
financial needs - what you are
saving for. You should have a good
idea about all these areas before
you begin to invest.
Once you have invested, you
should regularly review your goals
to see if anything substantial has
changed. Like life insurance plans,
life savings plans need adjustments
as your circumstances change. And
like a good insurance agent, a good
financial advisor can help you
determine which investments most
closely meet your objectives, for
the present and into the future.
2. Keep your investments simple
Match your investment selections
to your investment needs. For
example, if you can invest for a
longer period of time, consider
growth and balanced mutual funds
for enhanced returns. If you have
short-term goals, consider
guaranteed return vehicles such as
GICs (Guaranteed Investment
Certificates) and Canada Savings
Bonds. Don’t rely on short-term
investments to support long-term
needs.
3. Don’t wait for RSP time to
invest - do it now, and do it often
There is no “perfect time” to
invest. Once your financial goals
are clear, invest as soon as you
possibly can. The power of
compound interest works for you
from the moment you make your
investment, and continues to grow
the longer your capital is invested.
And while it’s easy to leave your
major investment decisions until
the annual RSP deadline rolls
around, it’s not the wisest way to
help your savings grow. By
contributing only a small amount to
your mutual fund on a regular
basis, for example, you can benefit
from “dollar-cost averaging”.
Through dollar-cost averaging,
when you invest regularly, the fund
units your investments buy will
tend to be purchased at differing
prices over a longer term. This
means that your average unit price,
over time, should be well below the
current market level. Why? That’s
because your fund should have
been able to purchase more units
when prices were lower, and fewer
when prices were higher.
By using as simple a method as a
pre-authorized chequing plan, you
can make regular contributions, and
get dollar-cost averaging working
for your savings.
4. Review your investments with
a financial advisor
Everyone’s investment portfolios
and financial goals require regular
checkups. A financial advisor can
review your investments, discuss
fund options, and help ensure that
your investment strategy continues
to meet your needs.
If you do not have a financial
advisor, you can be referred to an
independent investment profes
sional in your community by
calling, tollfree: Fidelity Invest
ments at 1-800-263-4077.
- News Canada
JACQUIE GOWING ACCOUNTING SERVICE
Computerized 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
LAURENTIAN BANK
OF CANADA
For All Your
RRSPs
&
Mutual Funds Needs
See us at
The Laurentian Bank of Canada
237 Josephine St., Wingham 357-2022
like to contribute
to your RRSP.™
Introducing Canada’s first family of 5-Year Protected Mutual Funds.
PRINCIPAL GUARANTEED WITH UNLIMITED
POTENTIAL FOR GROWTH.
You can trust us for better advice, more options, on your terms.
Call and make your appointment today.
CIBC - BLYTH 523-4247
BRUSSELS 887-6521
SEEING BEYOND™
(ClBC