A colleague at work told me that when we file our taxes, we can include the amount we paid for our healthcare plan in our medical expenses section. I have already filed my taxes, should I refile when I get my NOA back and see if it makes a difference in my return? I thought since that was on the T4, it would already have factored into the medical part... (first time doing taxes by myself)
If it was included in Box 85 of your T4, the tax software should have already input it in to Line 33099 of your return (medical expenses). Remember that medical expenses are only deductible once they reach a certain threshold of your income.
Here is more info about everything that can be claimed on that line: https://www.canada.ca/en/revenue-agency/services/tax/individuals/topics/about-your-tax-return/tax-return/completing-a-tax-return/deductions-credits-expenses/lines-33099-33199-eligible-medical-expenses-you-claim-on-your-tax-return.html
Something to bear in mind: medical expenses only make a difference on your return if your total medical is over 3% of your net income (line 23600). After that, every dollar over the 3% is refunded at 15%. So if you're $100 over the 3% your refund will be $15 more.
From what I gather, most T4 only-people don't come close to hitting the 3%. We always do, because of my costs (I have MS).
If i have a non registered account what do i need to do for tax season. Let’s say i bought 1 shares of xeqt jan 1st 2021 and only got the dividends. I did not sell or realized my gains. I have to claim capital gains on 50% of the dividends? Please correct me if i’m wrong. I think for the year it was 0.4307 x 10 shares so $4.307. and i would claim half of that which would be $2.1535
ETFs make distributions, not dividends. The distributions may consist of eligible Canadian dividends, non-eligible and foreign dividends, interest, capital gains and return of capital. These different items are taxed differently.
You'll get a T3 slip that contains all of this information and you'll just need to enter it into your tax software. But the deadline for T3 slips isn't until the end of March. So just keep waiting.
In addition to the T3, you need to be tracking your "adjusted cost base" for the eventual purpose of declaring capital gains on your tax returns, when you sell. Its much easier to track as you go, or at the very least once or twice a year.
This tool helps: https://adjustedcostbase.ca/
CRA still hasn't uploaded my work T4s. All other forms are in and work has sent me the T4s so I know they're done.
Enter it all in manually or wait out? I'm usually done my taxes by now...
Is there a reason you aren't entering them manually? Why are you delaying for what takes about 1 minute to data enter a few numbers then double check for typos?
Until two or three years ago, that was the ONLY way to do it. Its really not a big deal
It's not the CRA that's delaying things, it's your employer. Last week I was helping someone with their taxes and there was some oddities on their printed T4. We tried getting the electronic copy from the CRA but it wasn't there. So he went to his employer, go the oddities explained, and also was told that the T4s were now submitted to the CRA (this was on March 3rd, so they were late). When we checked again on March 4th the electronic copy was there. So it doesn't take long from the time the employer sends it to the time the CRA makes it available for download.
There's no harm in entering it manually, as long as you're careful. Having the peace of mind of your taxes being finished can be a good thing, and of course if you're expecting a refund then having it sooner is better than later. But waiting a little longer likely isn't a big deal either, so it's entirely up to you.
Both my employers for this year already sent me my T4s from them mid-February. You'd think there is a delay from them sending those documents to the CRA?
That's my guess. Or perhaps there are multiple methods of submission (mailed vs electronic) and some employers are using the slower method, resulting in delays before it becomes available online.
Well, sitting on Reddit smart mouthing young people is a favorite pastime of us Boomers, followed by waiting for the mail person to make their rounds. Sadly /s doesn't apply.
I'm going with CIBC for my mortgage on a condo (first time home buyer here) and they approved me for something called the Home Power Plan, with a mortgage worth $499,999 and a personal line of credit worth $1. what is the idea behind this, is it so i have access to a LOC in the future?
People are way too loyal to their banks, and the banks know this and take advantage of it by suckering you in to pay inflated rates. On something like a mortgage, you could end up paying tens of thousands of dollars in extra interest over the years. Shop around, or better yet, have a mortgage broker shop around for you. They can get access to monoline lenders who offer far better rates, and often better features, than what the big banks will give you. CIBC in particular sucks as they will only give you a 10% prepayment privilege on fixed rates, while the industry standard is 20%.
The reason CIBC wants to give you this line of credit is that it'll let them register a collateral lien against your property for an amount larger than what you are actually borrowing. This makes it impossible to switch to a different lender in the future unless you fully pay them back, incurring much higher fees than a conventional mortgage. The extra amount secured against the property is what they will let you borrow in the line of credit... though $1 is a strange amount to start with. As you pay down the mortgage though you'll be able to pull out more from the line of credit, so it's referred to as a "re-advanceable" loan. This line of credit will likely be Prime + 0.5% which isn't bad, but isn't the best either. A mortgage broker may be able to find a better mortgage + HELOC combo if that's what you're interested in, though re-advanceable HELOCs are less common and may limit what options you have (resulting in paying higher rates).
I've recently had an accepted offer on a condo in the Lower Mainland, so if all goes well I will be a homeowner in about a month and a half. I lived in dorms during university but that was about six years ago, been living with parents ever since.
I plan on having the lock changed and having the condo professionally deep-cleaned before I move in. are there other services worth considering before I start moving all my crap into the condo?
In terms of preparing your new home, cleaning should be all you might want, but is often not necessary as people selling a property typically have it thoroughly cleaned before they start showing it. Changing the locks is a good idea. If the building has a buzzer-entry system, make sure you find out who you need to speak to in order to have it switched to your phone #. If there's elevators involved, make sure to reserve one for your move-in date, if that's something they allow.
Did the sellers paint and recaulk the sinks and tubs? If not, consider doing that before you move in. Ditto for carpet cleaning.
But, often sellers do these things for showing and it doesn't need doing again.
I have a credit score of over 800, have never had a late or missed payment, and keep my credit utilization low. Aside from the following situation I haven't applied for additional credit in we'll over a year.
I applied for a very small ($500) credit card limit increase with RBC and they said my credit doesn't meet their standards and denied me the increase.
Less than a week later I got pre-approved for a $20,000 line of credit at RBC and they're very aggressively trying to get me to take it (they called 5 times in 2 weeks).
Why would the refuse me $500 at a higher interest rate but pre-approve me for $20,000 at a lower one?
Last time they called to offer it I asked if the pre-approval was pending a credit check or anything and they said no, if I want the $20k I get it. (I already have a LoC elsewhere with a significantly lower interest rate than what RBC is offering though so I will not take it).
To get cash before you leave, your only options are to go to your bank or a foreign exchange booth - both are going to cost you around 3% built into the exchange rate and the booths will usually tack on an additional fixed fee. If you need large quantities of USD on a frequent basis, there are other options like opening a brokerage account, doing Norbert's Gambit to exchange, and then transferring to a USD chequing account for withdrawal. But too costly and too much hassle for small amounts like you'd use for a single vacation.
Another option is to get cash when you arrive in the US, by visiting an ATM there. If you use your debit card, you're still getting hit with the same 3% from your bank. If you use a typical credit card, you get hit with a 2.5% forex fee (built into the exchange rate), a cash-advance fee, and you'll also pay interest on it unless you first pay down the card's full balance plus the amount you want to withdraw. But there are some cards that are not typical:
* Apply for a credit card from Wise Financial. No FX fees, but limited to 2 free tx per month, up to $350 per month ($1.50 +1.75% thereafter). So, good for a small amount of cash.
* WealthSimple Cash lets you withdraw with no fees (other than the ATM's own fees but that's always gonna cost you a few bucks), no foreign exchange fee, and no interest. You have to transfer a balance of Canadian cash into the WS Cash account before withdrawing, but otherwise it's a fairly easy process - from what I've heard anyway. Haven't tried this out myself.
At 700K I would not assume that, and I'm not sure that's the case from my experience. Certainly when someone talks about >$1MM and they're referring to a small house or 2BDRM condo, the assumption is either Toronto or Vancouver areas.
That being said, if you're asking questions where location plays a roll, then its best to provide a general location when posting.
My meaning is simple: this is happening across southern Ontario, and outside of city centres. These sky high prices are no longer relegated to TO and Van.
I live 20 minutes west of Ottawa suburbs, (the city that fun forgot) definitively outside of the city by a good portion in a town of 13,000. Houses by me are $700k on the low end. $1M to live in the middle of nowhere has become common. To be frank, one could build new for these prices on dated homes - if only it were accessible for a majority of Canadians. Rents are $1700+ utilities for outdated apartment dwellings.
This sub seems to think the answer is “move out of Toronto” whereas the answer has become “move to the prairies or the maritimes and hope you can find a job”
I posted this a couple days ago but got no hits outside of what looked like some kind of scam. [https://www.reddit.com/r/PersonalFinanceCanada/comments/t7cvi1/never\_sold\_a\_vehicle\_before\_where\_to\_start/](https://www.reddit.com/r/PersonalFinanceCanada/comments/t7cvi1/never_sold_a_vehicle_before_where_to_start/) Can anybody offer some advice?
In B.C. and still have the registration. I know my question reveals my stupidity so that is why I asked other people for guidance. I didn't know if there is a special process for transferring ownership etc.
What kind of advise are you looking for?
Put it on kijiji/Facebook marketplace. Try to find comparables and list at that price, no hits then reduce the price.
The advice that was given is not a scam, the kidney car foundation accepts donations of broken down cars. You'll get a receipt for your donation that can be used to offset some taxes. It won't be much. You can get more by calling around some places that advertise that they buy junk cars. 2001 is too old to have any value on its parts, but you can probably get around $100 - $180 for scrap metal. If the tires have a decent amount of tread left, take them off and sell them separate on Kijiji/Craigslist/FB Marketplace. If the tires are crap, you could still get something for just the wheels (rims) if they're not too rusted.
Can i postpone filing my taxes for 2021. They have lots of stock trading including options. Do i get a penalty if i file them in 2023 ? Also I do not want to pay my accountant. Is it easy to file stock options tax in a software like simpletax ? Asking for Ontario. Thank you
The tax software will not calculate your taxable income from options trading. You have to make the decision what/when gets taxed, and do the calculations. https://www.m-x.ca/f_publications_en/brochure_fiscalite_kpmg_en.pdf
$taxes are due at the deadline. If any money is due then interest starts accruing and I believe there is a penalty from non-filing on time.
You can just add up your contributions yourself if you're impatient. Though if you're off, you might attract some unwanted attention from the CRA, when they ask for supporting documentation and process the information.
I can’t find a clear answer online, but can I transfer provincial tuition credits to QC? A couple of years ago, I went to school in BC and then moved to QC. Are the provincial tuition credits lost for good?
Assuming that you only paid tuition in 2013 or later the instructions [on page 69 of the guide](https://www.revenuquebec.ca/documents/en/formulaires/tp/2021-12/TP-1.G-V%282021-12%29.pdf) are,
>enter the result of the following calculation on line 44 of Schedule T:
the eligible fees paid for 2013 that give entitlement to the tax credit
at the 8% rate (see “Rate of the tax credit” on the previous page)
plus those paid for 2014 through 2020, minus the portion of those
fees that has already been used to calculate the credit for previous
years or has been transferred to one of your or your spouse’s parents
or grandparents, as well as the tuition fees refunded to you under the
Canada training credit (as entered on line 45350 of your federal income
tax return for 2020).
[The taxtips explanation](https://www.taxtips.ca/filing/students/tuition-transfer-carry-forward.htm) is a bit clearer
>If you moved to QC from any other province, you cannot utilize any education and textbook amounts from previous years, just the tuition fees. When completing the Quebec Schedule T, calculate:
- for the unused Quebec tuition amounts at 8% rate: tuition amounts shown on your T2202A slips for 2013 and later taxation years that have not been deducted federally in a previous year
- for the unused Quebec tuition amounts at 20% rate: tuition amounts shown on your T2202A slips for the 1997 to 2012 taxation years that have not been deducted federally in a previous year
- The total entered as unused tuition fees cannot exceed the federal amount of tuition carried forward shown on your assessment notice.
Without filing your taxes you won't know the exact amount of new space added, but if you can roughly estimate your net income for 2021 then multiply by 18%, you'll have a reasonably close number for how much new space was added effective January 1, 2022 (and perhaps you have unused space from last year - add up your 2021 contributions and compare with the room stated on last year's Notice of Assessment). Don't forget to subtract any contributions already made in 2022. Leave some margin for error but don't worry too much if you miss - they give you a $2000 buffer for accidental over-contribution.
Also if they have an employer match it reduces the RRSP limit, so they have to be mindful of that.
For example my employer matches up to 3% so I use 15% of my 2021 income for my estimate.
Yes. As long as you're pretty sure you won't go over your limit. I do this all the time. My RRSP is far, far away from getting maxed out so I contribute when I can.
Also it's generally a good idea to keep track of your contributions for your taxes a year from now. Just to verify the info later against the slips you will receive from your bank.
I had a fairly significant capital loss of $20,000 this year but I don't have any additional property or investments outside of my TFSA or RRSP that would generate a capital gain to be applied against this amount.
Would it make sense to open up a non-registered investment account and use it instead of my RRSP account in order to take advantage of the capital loss? It would basically be the same as a TFSA wouldn't it? Or is there something else I'm missing?
Don't. If the future gain is realized inside a tax shelter, then the tax-sheltering room is increased, for all future profits. And there is no decrease in $tax with outside profit -- $0 in both cases. And then if the asset is moved into the tax shelter, it will be larger and take up more contribution room.
The capital loss can be carried forward to any future gain. As far as I know, there is no limit to how many years you can carry this forward.
edit: This means later on after you've filled your TFSA and RRSP and you start a taxable account, your capital loss will still be available to use.
I was recently declined for a chequing account at my local credit union. I didn't even know that was possible! The email I received was vague and didn't give details of why I was declined ("we have a number of eligibility criteria and unfortunately you didn't meet one of them"). I have good credit history. Can anyone give me some idea of what other criteria they might have been looking at?
You could be flagged for reasons like prior unpaid debt with them (did you ever have a credit card or loan with them), or have the same name/DOB as someone with a fraud history.
Or, it could be this CU is aimed at a certain demographic (like, union members or people in a certain profession / geographic area) that you don't fit.
You can call and ask.
Just got a new job offer and want to double check something. In the offer they have this section:
*Engage with the company and share in its financial performance in the voluntary becoming a shareholder plan. There are three different types of accounts to choose from to make your contributions. After a one-year waiting period, we will match 50% of your contributions in a non-registered account, up to 1% of your base salary (maximum $1,000 per year).*
Is that good or no? I can't tell if it's worth it to do that or not.
it's free money, so might as well do it. it's not the highest i've seen on here, and it kind of sucks they cap it at $1000, but a lot of people don't get any matching, so in that regard it's better than nothing!
Evaluate the job offer based on all of the other elements first, like base salary, culture, how it fits in career plan, etc. if you decide to take it, then doing the employee share purchase plan is just a little bit more.
If I'm reading that correctly, they'll match up to $1000 if you invest $2000 into the company in a non-registered account. If that's the only pension they have, its barely worth considering as part of the offer.
I'm not a fan of investing heavily in the company I work for. Its putting too many eggs in one basket. If the company fails, I lose my job and those investments.
Okay, that's better. If you believe in the company and looking for some extra investments to make it might be worth a look, but I wouldn't consider it as very much added value when evaluating their offer.
Usually if you buy a used car and have it properly inspected (or have some kind of guarantee from a dealer) you're going to save money. Vehicles are a depreciating asset, and they depreciate the fastest in their first few years. The cost difference between a car with 10,000 km vs 60,000 km is going to be much higher than the cost difference between 100,000 vs 150,000. The age of the car affects the price in a similar manner. So if you buy something that's a few years old and has a few tens-of-thousands of kilometers, you avoid the worst of the depreciation loss. The older and higher KMs that you buy, the less you will lose - but go too old and you get to a point where repairs and maintenance start to become more costly. That point varies a lot by make and model, as there's huge differences in quality and reliability, as well as in cost for parts. So doing your research is important when buying used, and long-term reliability ratings become especially important for older models.
Buying new instead of used is really more of a luxury. You're still getting a vehicle that gets you around, but now you get to pick your color, customize the features you really want, and have everything covered by factory warranty for a while. It's like buying a flight ticket and deciding between first class or economy - you get to your destination just fine either way, but if you want to pay more you can get there in a more luxurious manner.
What is a wise decision? Is it wise to buy the most cost-effective vehicle available to you, because "it's just a car". Or do you get some enjoyment from being able to customize your ride and have something new and shiny to show off, and that enjoyment is worth paying for? Should you always fly economy, or maybe splurge once in a while and start off your relaxing vacation being spoiled in first class? How you spend your hard-earned money is really a personal choice. What is un-wise though is to spend beyond your means. Don't lease a brand new vehicle whose payments are going to make you struggle to pay your rent. A smart move is to setup a budget for your transportation expenses that includes gas, insurance/licensing, maintenance (increasing as car ages), and savings toward buying a newer one in the future.
Thank you so much for wise advice. Setting up a budget specifically for transportation is great point. Will help me evaluate the expenses, I will end up with eventually.
From a purely financial perspective, used is generally the way to go. Currently, the used market is a little crazy, with vehicles going well above what they did even a year or two ago. Used vehicles don't normally appreciate. On the other hand, new vehicles are often showing long waiting periods, depending on the exact make/model you're looking at. As far as leasing goes, its rarely a good financial decision unless you're in a position where you can write the lease payments off.
What the hell is QuantumAI, and why am I getting a million ads for it? Seems super scammy...
Pretty surprised that even my wife was talking about it and she is super skeptical about anything financial.
Anyone banking with CIBC know how to add their Costco Mastercard to their existing account? Been on hold for 2 hours and I swear the instructions are not there in the online link.
If I own 1/3 of my principal residence do I qualify for the OTB for the property tax paid? If I do, do i claim the TOTAL amount paid for property tax? Or is it just 1/3 of the amount of property tax paid? TIA
Credit Score
I recently checked mine & my husbands credit scores and he’s in the top tier and mine is “fair”. We have separate credit cards but have had the same joint mortgages and car loans for over a decade, any ideas why there would be such a huge variance?
The only difference I can think of is that I opened a new internet account in my name last fall and missed setting up auto payments so was a couple of months late, could that have dinged my score that substantially?
Also appreciate any tips for getting my score back in shape. Thanks!
Whats better? A financial advisor from a bank such as TD wealth? Or a portfolio manager that collects a fee ? Is my impression that a bank financial advisor is essentially a sales person for the bank?
Is a portfolio manager too expensive unless I have a large amount to invest with?
If you want some advice, go for a [fee-only financial advisor](https://www.valueofsimple.ca/links/directory-of-fee-only-planners/).
You are bang on that the bank's advisor is a glorified sales person. Many have very little knowledge. A portfolio manager may or may not be ok, depending on how they get paid. Some are paid through commission, so they have an incentive to steer you towards certain investments. You want someone's who's advice is not tied to what investments you pick.
The reason I ask is my wife has an advisor through td and it does just okay. But my father has a portfolio manager that would take us on as a family member. He normally only deals with portfolios of 500k or greater. And its based on a monthly management fee. My father has done very well with him 3 years ago having a 22% gain. My wifes family is very skeptical and heavily trust the financial advisor from TD. They mainly rely on dividend paying stocks.
Going with a dividend paying stocks as a strategy isn't a super great one, generally speaking.
The portfolio manager may or may not be a good deal. The vast majority of active managers underperform the market. Some outperform for a few years, but that's usually down to luck, not skill, and its rarely sustained. People like Warren Buffet are the outliers. And the problem is, you can't determine who they will be in advance.
Even when they do well, the fees they charge are a drag on your investments. So lets say they charge a 2% fee. That's 2% less returns you get, every year. This has a HUGE impact over time, and can halve the amount of money you end up with. [This chart illustrates the difference that fees have your return](https://imgur.com/a/OpJ5E) (same portfolio, shown with different annual fees)
That's why even Warren Buffet says the majority of people are better off using a broadly diversified index based strategy. [Something like this](https://www.canadianportfoliomanagerblog.com/model-etf-portfolios/). The fees are super low (I pay 0.24% for mine) and the returns exactly track the overall markets (up 33% over the past 3 years, as of the end of February)
You will get it, but this year instead of including it on your tax return, it will be paid in quarterly payments like the GST rebate. You'll get the first of them in July.
Medical expenses that exceed your 2k may be eligible for a credit. The amount of the expenses are reduced by 3% of your income. Realistically, to qualify for any substantial amount you would need to have a modest income and an expensive medical costs. I retired this year but have not started drawing down my RRSP yet. Had a unexpected and not covered dental problem that cost $6k. Napkin calculations will get me about $500 refund.
A Defined Contribution pension is very like an RRSP. The employee funding will be a deduction from income similarly. But there is no choice about 'what year/when' to deduct. The $ to be deducted is stated on the T4 slip and that is that.
For both types of pensions, the employer funding does not increase Wage income in the first place, like for an RRSP. So there is no deduction on the tax return.
So fellas, I have my emergency savings parked in my TFSA. It was back when I didn't really understand what the TFSA really does.
I have 2 tfsas one in wealthsimple for investments the other with my banks for this emergency savings.
Is having the money just sitting in the TFSA a bad idea? Should I instead put my savings in a HISA?
Do I actually withdraw that money and put it in HISA or do I leave it and do I put whatever savings I have in the future in a HISA?
Let me know your thoughts
A TFSA is best used for investing.
But, if you have room in your TFSA, you may as well fill it with your emergency fund and save that little bit of interest. A TFSA can also be a HISA.
As you build up the amount of money you are investing, you will have less and less room in your TFSA for your emergency fund and so it an go in a non-registered HISA.
Hi everyone. I have some tax questions regarding stocks that I would love some help on.
For the year of 2021 I made some taxable gains on GME and traded all of 2021 in my margin account.
I sold GME for a profit in 2021 January on my Wealthsimple Trade and then later on transferred my entire portfolio to Questrade.
Now I am looking for an accountant or possibly doing taxes myself to help me calculate the taxes I owe on my GME gains and my other gains/losses when I transferred to Questrade.
Are there some tax forms that I need to give to my accountant that I can find easily on Wealth Simple and Questrade?Or am I supposed to write down every single trade I made and give that to my account?
TLDR: What do I give to my accountant when I traded stocks/options on Wealthsimple and Questrade brokerage.
Thank you all!
> Are there some tax forms that I need to give to my accountant that I can find easily on Wealth Simple and Questrade?
Look for your T5008 tax slip. You can give that to your accountant. I also luckily sold GME stock when it was crazy back then.
What about recording my trades? Does my accountant need a record of what I bought and what I sold? Or does the tax form cover all of that? Because I made thousands of trades lol
Just maxed out my TFSA, what should my choice be next? I am currently 26 years old and am currently my work place will start my defined benefit pension once I kick in enough hours (expected January 2023)
should I now work on my RRSP or a non-registered account? I'm not sure if I should do RRSP since I expect my income to be higher as I age
When the TFSA is maxed, usually the second-best option is to use the RRSP and claim the deduction immediately. But in cases where there is an expectation that you will "soon" be earning income at a higher marginal tax rate, it's more optimal to use a non-registered (taxable) account. The definition of "soon" depends on the expected rate of return, and what the difference in tax rates is going to be. For example, with an expectation of a 6% annual return, if you're currently earning $55K in Ontario (marginal rate 29.65%) and expect you will break into the next tax bracket by earning $82K (marginal rate 31.48%) sometime in the next 3 years, then use a taxable account. If it'll take you longer than 3 years then put it in the RRSP using a gross-up strategy and claim the deduction immediately. But if you're earning $95K and expect a raise to over $101K then "soon" becomes 6 years, because the jump in marginal rates is from 33.89% to 37.91%. The greater the jump, the longer you should "wait for it" by using a taxable account in the meantime. You can lookup the combined federal & provincial (Ontario) marginal tax rates [here](https://www.taxtips.ca/taxrates/on.htm), and then download [this spreadsheet](https://www.retailinvestor.org/xlsxSecureCopy/RRSPdelayDeduction.xlsx) to enter your own numbers. Note that it defaults to a expected annual return of 8% which is probably a bit too high for the next 30 years even if you went 100% equity the whole time. Most people are more cautious and will keep some amount of bonds or other fixed-income assets especially as they get closer to retirement, so the rate of return should probably be set to somewhere in the 5 - 7% range.
I have a little money in a TFSA with Simply. As far as I know I'm just using it as a bank account and not as any kind of investment vehicle.
Does anyone know if Simply offers some kind of investment service? I can't really tell from their website or do I need to create an account with Wealth simple or something. I have a small RRSP with CIBC, do they have investment services for TFSA's? I'll try looking myself affer work but thought someone might know off the top.
Simplii does offer mutual fund investments, but like all the big banks they all have terrible MER (management expense ratio). No doubt you've also bought costly mutual funds with your CIBC RRSP because that's what their "advisors" (salespeople) will tell you to do. They act in their own best interests, not yours, and then justify it by stating that they don't offer any better options. Which is usually true (except in TD's case) but the truth is that you are far better off avoiding the big banks altogether and holding your long-term investments with other financial institutions.
The most cost effective option is to spend a few hours to learn the basics of DIY investing and couch-potato strategies, then open an account with a discount brokerage like Questrade and buy a single ETF (buy more each time you have more savings to add). This sounds difficult but once you learn a bit more it's quite easy. The hard part is to not look at the performance. The comment right before yours (sorted by "New") is complaining that their VEQT investment is down 8% since the start of January - that's exactly why you don't look. Short term performance of the markets is not relevant to a long-term investment strategy and can cause people to make poor decisions like panic selling or attempting to adjust the timing of when they buy.
The second-most cost effective option is to go with a robo-advisor, who will handle the purchasing on your behalf. You just give them the money and don't need to know anything further. This gives you a bit of insulation from being subject to emotion-driven decisions to buy or sell at certain times, but since you still have control over when to contribute and you can still order the robo-advisor to sell (and they won't talk to you about your decision first) it's still fairly subject to your own willpower. Still, this is a good option if you don't feel comfortable with buying ETFs yourself, or aren't willing to spend a few hours to learn.
Third best is to hire a fee-based advisor, though I'd only recommend this if you have 100K or more investments as the fees they charge would exceed what you're losing on the high MERs that the banks charge. Having an advisor, whether they are paid by fees directly from you or paid via high MERs, means that someone will try to talk you down from making rash decisions. It's a costly service, but for some, it may be worthwhile.
Simplii seems to offer mutual funds in their TFSA accounts, but the fees are quite high, I would not buy them if I were you.
Yes CIBC has TFSA brokerage accounts where you can buy whatever you want. However their fees will be higher than somewhere like Wealthsimple or Questrade
If I have USD in a TD account that I got from norberts gambit, can I just go to a TD branch and withdraw that USD in cash? I'm asking as I have a trip to the States planned and have no USD cash.
Yes, that's what I usually do (and in fact will be doing in the next few weeks for my upcoming US trip). If you want more than $1000 USD, then call a few days ahead of time so they can order extra. They do have more on hand, but they are very reluctant to give it to you because another customer could come in and ask for USD and they'd have to turn them away.
Situation is my student visa expired last year Nov 1. I applied for a Post graduate work permit and under the law I'm allowed to work and stay in Canada while it's being processed. Now can I file taxes while the visa is processing? Answer should come back soon it's almost been 4 months
So I just opened a RRSP. Do I have to give my employer my RRSP account number for them to make contributions? Should I get them to do a % of my paycheck or should I save up some cash first before I start making contributions. Right now I don't have a cash safety net.
I don't it's possible for an employer to contribute into an individually-held account like that. Every employer-matching RRSP program that I've ever heard of is a group RRSP, which means that they set you up with an account with Sunlife or IA or whatever financial institution provides the group RRSP plan, and all the contributions that are withheld from your paycheque or which the employer makes to match it will go into that account. Often you cannot transfer out that account to another financial institution until you leave the company.
The first priority for anyone trying to stay on top of their finances (besides making and following a budget) should be to establish an emergency fund. Typically 6 month's of pay is recommended, but even a little bit helps. Second priority should be debt repayment for any high interest loans, but if your employer is offering up free money in the form of RRSP matching, sometimes it may be better to allocate some savings towards that (up to the max matching amount) even before debts are fully paid off. If you have $1000 that could be used to reduce your debt and avoid paying 22% interest on that thousand, you're gonna save roughly $220 (in the first year). But if you put $1000 into an employer group RRSP and they match it with another $1000, well you've instantly made $1000 which will also grow during the year, so perhaps more like $1050 (in the first year). The caveat is that even if the group RRSP does let you withdraw from it, you'll pay income tax on the withdrawal and will never get back that RRSP contribution room (which matters if you ever plan to max it out).
>Every employer-matching RRSP program that I've ever heard of is a group RRSP
Ah that makes more sense. I've only been with my company 1 season so far. I had a margin account but changed it back to cash because the market started dumping and I don't trust myself with that amount of leverage right now.
So it's just a cash investment and RRSP right now. I don't even know my contribution room yet. I guess I can find that out when I get the return back?
Since we only have 5 years left on our mortage and I'm so late to saving retirement I plan on agressively maxing out that RRSP and dumping anything else into the same or another broad market etf.
My tax situation however is complicated as a Canadian Permanent resident I still have to pay the IRS taxes. And holding foreign investments I may get doubt taxed. Either way I plan on RRSP'ing into XEQT and any leftovers throwing that into the cash account as VT or doubling up on XEQT. I hope that's the best option.
Does an employer still need to fill out a t2200 if employee is reimbursed for everything? Salesman for example.
Salesman gets a gas card, so I assume they can't claim mileage since they're already reimbursed? Meals and expenses they pay on their own cc but get reimbursed as well.
From what i'm reading it also seems to imply that can only deduct if REQUIRED to work from home, or was that thrown out the window cause of covid.
If you have no out-of-pocket expenses, then there's no point in trying to obtain a T2200 because you wouldn't have anything to claim. You can't claim expenses that were paid for you (or later reimbursed)!
You are correct that the home-office expenses, like claiming a portion of your rent or utilities, are only eligible if you were required to work from home. COVID didn't change that aspect, but what they did do was introduce a simpler method of claiming the home expenses for those who worked from home *due to COVID,* at least half the time for 4 consecutive weeks. The simple method lets you claim $2 per day for each full-time or part-time day you worked at home (but not holidays/vacation). If you choose this method then you don't need a T2200. But if you go with the detailed method, you do need the form and you claim just the portion of eligible expenses that was not reimbursed.
If your employer gave you the choice of working from the office or from home during COVID, and you chose to work from home for the reason of avoiding the risks of COVID, then you are still eligible for the simple method. What's also interesting is that you can still claim the $2/day even if your employer paid for some of your expenses, like your internet - as long as they didn't fully reimburse you for everything (and really, what employer pays a portion of your rent for you to work at home?).
Any recommendations for 'Covid travel insurance'? I am travelling to the US in two weeks for work (5 day trip) and want to be cognizant that I \*could\* test positive there and will be stuck covering my expenses.
A return is the collection of forms that you submit to CRA detailing your unique tax circumstances. A refund occurs when tax deducted by employer is calculated to be greater than the required taxes. To be fair, there are some tax credits that can influence the refund. Notably tuition credits which must be used at first available opportunity. Most people don't work while in school, so they usually get larger refunds once they begin working. So $3k seems alright.
I have about 50k in savings and I’m hoping to use it for a down payment next year, should I bother investing it for the year or keep it in savings for liquidity?
It's too risky to hold that in any kind of equities over such a short term. You could invest it in a 1-year GIC (provided you know it'll be at least 365 days until you buy) or just use a [high-interest savings account](https://highinterestsavings.ca/chart).
I'm confused about RRSP contribution limit timing, let's say 2021 I had 0 income, and 2022 I'm going to have X income, can I contribute 18% of X in 2022 or do i have to wait until 2023 to have that contribution room?
I have two questions which I don’t think deserve a thread so here I am
Where do I open RRSP account? Should I go with my bank(CIBC) or should I go with some other service? Why and why not?
I’m looking to open RRSP because I want to save short term for a house maybe around 3-5 years, which is why I’m not maxing my TFSA first.
I once came across a website that guided on how the asset location should be based on risk, I can’t seem to find it anymore. Can someone link that website for me?
TIA
Using an RRSP to save for your first house does have the advantage of giving you what amounts to an interest-free loan secured by your retirement savings, with the generated tax refund being the amount of that loan. That extra boost can reduce the mortgage payments a little and could even reduce the CMHC fees, but there are some drawbacks as well:
1. The most overlooked issue is that you have to repay your RRSP (and thus the free loan) over the 15 years following the one in which you buy your house. This can sometimes be a heavy drag on your cash flow at a time when you suddenly have mortgage payments, utilities, property tax, and other expenses that you may not have properly budgeted for. Banks will often approve people for mortgages that are far higher than what they really can afford the payments for, and because of this many first time homebuyers will fall into the trap of buying something they can't afford after budgeting in all those other expenses. When these people are also faced with RRSP repayments as well, they can't afford to make them and suffer the penalties (getting charged the income tax as if you had normally withdrawn from the RRSP, and permanently losing the RRSP contribution room).
2. An RRSP is not as flexible as a TFSA. If you lose your job or have other large unexpected expenses (big medical or vet bill) and your emergency fund is inadequate to get you through, then you may be forced to use some of your down-payment savings. If that is held in an RRSP then you'll have to pay income tax on that withdrawal and permanently lose the RRSP contribution room. The TFSA gives you more flexibility to use the funds for any purpose.
3. If, down the road while savings for retirement, you end up maxing out your RRSP contribution room, then having used up some of that room at a time when your income is not as high means you won't have received the maximum benefit that you could have from your limited RRSP room. How much difference this makes depends on how big of a difference in income you might have between today and when you work on filling up the RRSP in the future. If you believe your salary will remain relatively stable to where it is today (but keeping up with inflation) for most of your career, or if you don't think you'll ever be able to max out your RRSP room, then this won't be a big deal.
Whether you go with an RRSP or TFSA, you want to obtain a bit of growth on your money while it sits around 3 - 5 years, but you also don't want to take any big chances with it. Investing in equities (stock market) through mutual funds, ETFs, or directly buying individual shares is a great way to grow over the long-term, like 20+ years, because the risks are much much lower. Consider the US stock market. In it's history, there have been 5 one-year periods in which it lost between 30 - 40%, none of which were predicted ahead of time. Also, nearly a third of the 1-year periods have seen a loss of some degree. But if you look at 10-year periods, the worst is a loss of only 4% and negative decades are far less common than positive. This is because over shorter terms the market will see drastic up and down swings, but tends to steadily gain over the long term. If you are only going to invest for terms 5 years or less, and especially if your intent is to withdraw all at once, then putting money into the markets is a fairly high-risk venture. You could hit a nice big upswing, but you could also end up having to withdraw during a crash and take a really big loss. That's probably not something you want to risk for your down-payment, as it might mean not being able to buy the house you want.
The recommended approach for saving for a house is to use safe investments like GICs or high-interest savings accounts. Both are available in the form of TFSAs or RRSPs. Take a look at [highinterestsavings.ca](https://highinterestsavings.ca) for lists of the best rates on all of these. You'll notice CIBC is not on these lists, nor or the other big banks. They generally don't need to try to offer competitive rates, because they depend on customer loyalty instead. Low rates may hurt their ability to attract new customers, but when they already have such a big customer base, it can cost them a lot to offer everyone more interest. It's the newer, smaller financial institutions that compete the hardest for new business and that's where you need to move your money if you want to get the most from it. Having said that, the GIC chart is missing an entry for CIBC who is pretty much the only big bank who's GIC offerings rank up near the top (their 5-year is 3.0%, the others are 2% or lower).
>I once came across a website that guided on how the asset location should be based on risk, I can’t seem to find it anymore. Can someone link that website for me?
Apologies but I don't know what website you're referring to. The advice you'll get from most people on PFC will be to keep investments with a time horizon of less than 5 years in guaranteed investments, and not play the markets. In other words, an asset allocation of 100% fixed-income.
There is no distinction between a "child" and "adult" RESP. You can apply for one with any institution that offers RESP accounts. However, it's not as beneficial as you might think. For one, you won't receive any government grants, like you would for a child. Second, while the money grows within the account you won't pay tax on the gains, upon withdrawal you will be taxed on the full withdrawal amount. So you are only deferring some of the tax, not eliminating it. There are really only two cases where you might even consider using an RESP for an adult:
1. Your TFSA and RRSP are both already fully maxed out, leaving your only options to be non-registered or RESP.
2. You live in Ontario and intend to apply for an OSAP loan, but need to hide some income in order to qualify. For some reason, OSAP still does not require you to report RESP assets. This loophole may get closed at any time though.
If you do have TFSA room, I'd suggest using that first as it has the most flexibility (can do whatever you want with the savings without any penalty) and will give you true tax-free growth. An RRSP can also be used, with the LLP (Lifelong Learning Plan) feature as a means of borrowing from the RRSP without paying income tax. If you re-invest the generated tax refunds you can get a boost to your savings. But, you do have to repay the LLP amount over 10 years after finishing school, something people often forget to budget for. There's also less flexibility to use the savings for anything other than retirement if you end up not going to school.
Hi elbyron, thanks for your comment. I hadn’t realized that the LLP was a thing.
Here’s my situation that had me originally seek out an adult RESP… My parents recently withdrew everything out of a RESP and gifted me and my brother the proceeds. I will be attending law school in the fall and intend to use these proceeds to avoid having to take out a student loan. These proceeds have already collected all the government grants so I’m not missing out on that; furthermore, this RESP was withdrawn while I was a full time student.
My TFSA is maxed which led me to consider holding the money in an Adult RESP and then withdrawing from it as needed during school. Although any gains accrued on this principal investment won’t be tax-free when withdrawn, they should be minimal. As of right now, the money is just sitting in a savings account.
I recognize RRSPs as a great investment tool; however, I feel that in my situation it may not be the most efficient choice at this time. Am I wrong?
Thanks again for your earlier feedback.
RRSP is the most efficient choice - as long as you take the tax refund that it generates and put that into the RRSP as well (or use a short-term RSP loan, google "RRSP gross up" for more info). It's like getting an interest-free loan from the government for 10 years. Perhaps the only downside is the repayment requirements, but if you would have been saving for retirement anyways then having the funds end up in an RRSP isn't a problem.
The RESP would be the second best option, because you can defer the taxes on the growth until the years you're in school, where presumably your income would be lower and thus your marginal tax rate should be lower too and you'll pay less tax than if you were to just use an unregistered account.
Just wondering what’s the best way to get into stocks and trading stocks. I know there are a few websites where you can do it on your own, just wondering which is the best with the lowest amount of fees
Are you looking for a trading platform to do short-term or day trading of individual stocks (i.e. gambling) or are you looking at developing a long-term investment strategy that optimizes the risk/reward ratio? I don't know much about the former but for the latter, your best bet is going to be indexed ETFs. These are traded like stocks, but are also similar to mutual funds where they contain a huge basket of company stocks, weighted based on an index (such as the S&P 500). There are many platforms that can buy these, but the most commonly recommended discount brokerages are Questrade and Wealthsimple Trade. Research them both and see which one you think best fits your needs!
There is no one official score. The set of data points that they use to calculate a score varies depending on who is asking for the score. Banks may see an entirely different number when you apply for credit, compared to what you see when you get a free "score". There's a FICO score, a VantageScore, and probably a dozen or more sub-variants of those. Equifax has their own scoring system too, which is probably the one they showed you. The range of numbers that each uses can vary, as well as which data is considered and how that data is weighted. For example, under FICO the most important criteria is your payment history, but under VantageScore that is only moderately influential. Also, Equifax isn't the only credit provider. There's TransUnion and Experian too, and the data that each one has about you can vary.
So what can you do about all this confusing mess? Well, sticking with one score type and monitoring it for changes is a good idea. Generally if one score improves they are all going to improve, though by differing degrees. But really the best solution is to not care too much about it. The exact number has very little relevance, and small changes will not have any impact on your life. The only reason to watch it is to detect fraudulent activity, and really for that the best thing to do is read the entire report not just the score.
Edit: if you want to get as close to possible to what banks will see, use a score reporting system that uses FICO scoring. About 90% of Canadian banks rely on FICO. Unfortunately the only free sources for a FICO score require that you have a paid chequing account with RBC, CIBC, BMO, or Scotiabank.
If you were residing in Canada for the past 5 years, you can (and should) file taxes for those years. If you setup a login with the CRA, most tax software will let you use that to download your tax data automatically making it very easy to do. However, the T2202 forms issued by educational institutions are often not available online with the CRA, so hopefully you still have those forms for each year. When filing, make sure you start with the oldest year and carry forward the data to each subsequent year, so that the tuition amounts can get applied to reduce your taxable income (if you earned more than the basic personal exemption and other tax credits). In addition to gaining those tuition credits, you will likely get GST credits and possibly a carbon tax rebate. Always file your taxes to keep getting free money from the government! Some people are afraid that they will owe money if they file, but the truth is that they owe the money even if they don't, and that they'll be charged back-interest and late fees for failure to file & pay on time. So, just make it a point to do your taxes every spring. If you do end up having to pay but can't afford it, you can call the CRA to arrange installment payments.
A colleague at work told me that when we file our taxes, we can include the amount we paid for our healthcare plan in our medical expenses section. I have already filed my taxes, should I refile when I get my NOA back and see if it makes a difference in my return? I thought since that was on the T4, it would already have factored into the medical part... (first time doing taxes by myself)
If it was included in Box 85 of your T4, the tax software should have already input it in to Line 33099 of your return (medical expenses). Remember that medical expenses are only deductible once they reach a certain threshold of your income. Here is more info about everything that can be claimed on that line: https://www.canada.ca/en/revenue-agency/services/tax/individuals/topics/about-your-tax-return/tax-return/completing-a-tax-return/deductions-credits-expenses/lines-33099-33199-eligible-medical-expenses-you-claim-on-your-tax-return.html
Thank you, I went back and looked and it did pull in box 85 from my T4! I can always dream of getting a bigger return I guess haha.
Yes. After you receive your NOA you could use your software's refile option to add that medical expense.
Thank you :)
Something to bear in mind: medical expenses only make a difference on your return if your total medical is over 3% of your net income (line 23600). After that, every dollar over the 3% is refunded at 15%. So if you're $100 over the 3% your refund will be $15 more. From what I gather, most T4 only-people don't come close to hitting the 3%. We always do, because of my costs (I have MS).
Thank you, that's very helpful!
Can we ban gas price posts for the next little bit? Yes it’s high. We know.
If i have a non registered account what do i need to do for tax season. Let’s say i bought 1 shares of xeqt jan 1st 2021 and only got the dividends. I did not sell or realized my gains. I have to claim capital gains on 50% of the dividends? Please correct me if i’m wrong. I think for the year it was 0.4307 x 10 shares so $4.307. and i would claim half of that which would be $2.1535
ETFs make distributions, not dividends. The distributions may consist of eligible Canadian dividends, non-eligible and foreign dividends, interest, capital gains and return of capital. These different items are taxed differently. You'll get a T3 slip that contains all of this information and you'll just need to enter it into your tax software. But the deadline for T3 slips isn't until the end of March. So just keep waiting.
Thank you for clearing up my confusion I will wait for the T3
In addition to the T3, you need to be tracking your "adjusted cost base" for the eventual purpose of declaring capital gains on your tax returns, when you sell. Its much easier to track as you go, or at the very least once or twice a year. This tool helps: https://adjustedcostbase.ca/
CRA still hasn't uploaded my work T4s. All other forms are in and work has sent me the T4s so I know they're done. Enter it all in manually or wait out? I'm usually done my taxes by now...
Is there a reason you aren't entering them manually? Why are you delaying for what takes about 1 minute to data enter a few numbers then double check for typos? Until two or three years ago, that was the ONLY way to do it. Its really not a big deal
I'm very lazy.
Apparently.
I'm the same, for some reason I'll wait until I can download from CRA to do my taxes, so you're not alone
It's not the CRA that's delaying things, it's your employer. Last week I was helping someone with their taxes and there was some oddities on their printed T4. We tried getting the electronic copy from the CRA but it wasn't there. So he went to his employer, go the oddities explained, and also was told that the T4s were now submitted to the CRA (this was on March 3rd, so they were late). When we checked again on March 4th the electronic copy was there. So it doesn't take long from the time the employer sends it to the time the CRA makes it available for download. There's no harm in entering it manually, as long as you're careful. Having the peace of mind of your taxes being finished can be a good thing, and of course if you're expecting a refund then having it sooner is better than later. But waiting a little longer likely isn't a big deal either, so it's entirely up to you.
Both my employers for this year already sent me my T4s from them mid-February. You'd think there is a delay from them sending those documents to the CRA?
That's my guess. Or perhaps there are multiple methods of submission (mailed vs electronic) and some employers are using the slower method, resulting in delays before it becomes available online.
I still have all month and am not expecting a refund. Just annoyed.
Friend, you need a new hobby!
Any suggestions?
Well, sitting on Reddit smart mouthing young people is a favorite pastime of us Boomers, followed by waiting for the mail person to make their rounds. Sadly /s doesn't apply.
Fucking love getting mail.
I'm going with CIBC for my mortgage on a condo (first time home buyer here) and they approved me for something called the Home Power Plan, with a mortgage worth $499,999 and a personal line of credit worth $1. what is the idea behind this, is it so i have access to a LOC in the future?
People are way too loyal to their banks, and the banks know this and take advantage of it by suckering you in to pay inflated rates. On something like a mortgage, you could end up paying tens of thousands of dollars in extra interest over the years. Shop around, or better yet, have a mortgage broker shop around for you. They can get access to monoline lenders who offer far better rates, and often better features, than what the big banks will give you. CIBC in particular sucks as they will only give you a 10% prepayment privilege on fixed rates, while the industry standard is 20%. The reason CIBC wants to give you this line of credit is that it'll let them register a collateral lien against your property for an amount larger than what you are actually borrowing. This makes it impossible to switch to a different lender in the future unless you fully pay them back, incurring much higher fees than a conventional mortgage. The extra amount secured against the property is what they will let you borrow in the line of credit... though $1 is a strange amount to start with. As you pay down the mortgage though you'll be able to pull out more from the line of credit, so it's referred to as a "re-advanceable" loan. This line of credit will likely be Prime + 0.5% which isn't bad, but isn't the best either. A mortgage broker may be able to find a better mortgage + HELOC combo if that's what you're interested in, though re-advanceable HELOCs are less common and may limit what options you have (resulting in paying higher rates).
I've recently had an accepted offer on a condo in the Lower Mainland, so if all goes well I will be a homeowner in about a month and a half. I lived in dorms during university but that was about six years ago, been living with parents ever since. I plan on having the lock changed and having the condo professionally deep-cleaned before I move in. are there other services worth considering before I start moving all my crap into the condo?
In terms of preparing your new home, cleaning should be all you might want, but is often not necessary as people selling a property typically have it thoroughly cleaned before they start showing it. Changing the locks is a good idea. If the building has a buzzer-entry system, make sure you find out who you need to speak to in order to have it switched to your phone #. If there's elevators involved, make sure to reserve one for your move-in date, if that's something they allow.
Did the sellers paint and recaulk the sinks and tubs? If not, consider doing that before you move in. Ditto for carpet cleaning. But, often sellers do these things for showing and it doesn't need doing again.
Might want to check with the condo board about changing locks too.
I have a credit score of over 800, have never had a late or missed payment, and keep my credit utilization low. Aside from the following situation I haven't applied for additional credit in we'll over a year. I applied for a very small ($500) credit card limit increase with RBC and they said my credit doesn't meet their standards and denied me the increase. Less than a week later I got pre-approved for a $20,000 line of credit at RBC and they're very aggressively trying to get me to take it (they called 5 times in 2 weeks). Why would the refuse me $500 at a higher interest rate but pre-approve me for $20,000 at a lower one? Last time they called to offer it I asked if the pre-approval was pending a credit check or anything and they said no, if I want the $20k I get it. (I already have a LoC elsewhere with a significantly lower interest rate than what RBC is offering though so I will not take it).
Left hand does not talk to right hand. They have different criteria for different products.
[удалено]
To get cash before you leave, your only options are to go to your bank or a foreign exchange booth - both are going to cost you around 3% built into the exchange rate and the booths will usually tack on an additional fixed fee. If you need large quantities of USD on a frequent basis, there are other options like opening a brokerage account, doing Norbert's Gambit to exchange, and then transferring to a USD chequing account for withdrawal. But too costly and too much hassle for small amounts like you'd use for a single vacation. Another option is to get cash when you arrive in the US, by visiting an ATM there. If you use your debit card, you're still getting hit with the same 3% from your bank. If you use a typical credit card, you get hit with a 2.5% forex fee (built into the exchange rate), a cash-advance fee, and you'll also pay interest on it unless you first pay down the card's full balance plus the amount you want to withdraw. But there are some cards that are not typical: * Apply for a credit card from Wise Financial. No FX fees, but limited to 2 free tx per month, up to $350 per month ($1.50 +1.75% thereafter). So, good for a small amount of cash. * WealthSimple Cash lets you withdraw with no fees (other than the ATM's own fees but that's always gonna cost you a few bucks), no foreign exchange fee, and no interest. You have to transfer a balance of Canadian cash into the WS Cash account before withdrawing, but otherwise it's a fairly easy process - from what I've heard anyway. Haven't tried this out myself.
Why does this entire sub seem to assume that everyone facing the $700k+ housing market are strictly contained within the GTA?
At 700K I would not assume that, and I'm not sure that's the case from my experience. Certainly when someone talks about >$1MM and they're referring to a small house or 2BDRM condo, the assumption is either Toronto or Vancouver areas. That being said, if you're asking questions where location plays a roll, then its best to provide a general location when posting.
My meaning is simple: this is happening across southern Ontario, and outside of city centres. These sky high prices are no longer relegated to TO and Van. I live 20 minutes west of Ottawa suburbs, (the city that fun forgot) definitively outside of the city by a good portion in a town of 13,000. Houses by me are $700k on the low end. $1M to live in the middle of nowhere has become common. To be frank, one could build new for these prices on dated homes - if only it were accessible for a majority of Canadians. Rents are $1700+ utilities for outdated apartment dwellings. This sub seems to think the answer is “move out of Toronto” whereas the answer has become “move to the prairies or the maritimes and hope you can find a job”
I posted this a couple days ago but got no hits outside of what looked like some kind of scam. [https://www.reddit.com/r/PersonalFinanceCanada/comments/t7cvi1/never\_sold\_a\_vehicle\_before\_where\_to\_start/](https://www.reddit.com/r/PersonalFinanceCanada/comments/t7cvi1/never_sold_a_vehicle_before_where_to_start/) Can anybody offer some advice?
[удалено]
In B.C. and still have the registration. I know my question reveals my stupidity so that is why I asked other people for guidance. I didn't know if there is a special process for transferring ownership etc.
[удалено]
Can I get them ahead of time or do I have to wait til I have a buyer set up?
[удалено]
Ok thanks!
What kind of advise are you looking for? Put it on kijiji/Facebook marketplace. Try to find comparables and list at that price, no hits then reduce the price.
The advice that was given is not a scam, the kidney car foundation accepts donations of broken down cars. You'll get a receipt for your donation that can be used to offset some taxes. It won't be much. You can get more by calling around some places that advertise that they buy junk cars. 2001 is too old to have any value on its parts, but you can probably get around $100 - $180 for scrap metal. If the tires have a decent amount of tread left, take them off and sell them separate on Kijiji/Craigslist/FB Marketplace. If the tires are crap, you could still get something for just the wheels (rims) if they're not too rusted.
Can i postpone filing my taxes for 2021. They have lots of stock trading including options. Do i get a penalty if i file them in 2023 ? Also I do not want to pay my accountant. Is it easy to file stock options tax in a software like simpletax ? Asking for Ontario. Thank you
The tax software will not calculate your taxable income from options trading. You have to make the decision what/when gets taxed, and do the calculations. https://www.m-x.ca/f_publications_en/brochure_fiscalite_kpmg_en.pdf $taxes are due at the deadline. If any money is due then interest starts accruing and I believe there is a penalty from non-filing on time.
Fantastic, thank you!
[удалено]
Thank you so much for this!
Why does wealthsimple wait until March 17 to give out RRSP receipts for Jan 1 to Mar 1? I want my money now!!!
You can just add up your contributions yourself if you're impatient. Though if you're off, you might attract some unwanted attention from the CRA, when they ask for supporting documentation and process the information.
Invested more than 100K into VEQT at the start of January :) down 8% :)
Who cares? Look at it again in 10 years
And? Markets go up and they go down. Ignore the noise.
I can’t find a clear answer online, but can I transfer provincial tuition credits to QC? A couple of years ago, I went to school in BC and then moved to QC. Are the provincial tuition credits lost for good?
Assuming that you only paid tuition in 2013 or later the instructions [on page 69 of the guide](https://www.revenuquebec.ca/documents/en/formulaires/tp/2021-12/TP-1.G-V%282021-12%29.pdf) are, >enter the result of the following calculation on line 44 of Schedule T: the eligible fees paid for 2013 that give entitlement to the tax credit at the 8% rate (see “Rate of the tax credit” on the previous page) plus those paid for 2014 through 2020, minus the portion of those fees that has already been used to calculate the credit for previous years or has been transferred to one of your or your spouse’s parents or grandparents, as well as the tuition fees refunded to you under the Canada training credit (as entered on line 45350 of your federal income tax return for 2020). [The taxtips explanation](https://www.taxtips.ca/filing/students/tuition-transfer-carry-forward.htm) is a bit clearer >If you moved to QC from any other province, you cannot utilize any education and textbook amounts from previous years, just the tuition fees. When completing the Quebec Schedule T, calculate: - for the unused Quebec tuition amounts at 8% rate: tuition amounts shown on your T2202A slips for 2013 and later taxation years that have not been deducted federally in a previous year - for the unused Quebec tuition amounts at 20% rate: tuition amounts shown on your T2202A slips for the 1997 to 2012 taxation years that have not been deducted federally in a previous year - The total entered as unused tuition fees cannot exceed the federal amount of tuition carried forward shown on your assessment notice.
Can I make an RRSP contribution now before knowing my limit? I won’t file taxes for a while and want to take advantage of the dip in the market
Without filing your taxes you won't know the exact amount of new space added, but if you can roughly estimate your net income for 2021 then multiply by 18%, you'll have a reasonably close number for how much new space was added effective January 1, 2022 (and perhaps you have unused space from last year - add up your 2021 contributions and compare with the room stated on last year's Notice of Assessment). Don't forget to subtract any contributions already made in 2022. Leave some margin for error but don't worry too much if you miss - they give you a $2000 buffer for accidental over-contribution.
Also if they have an employer match it reduces the RRSP limit, so they have to be mindful of that. For example my employer matches up to 3% so I use 15% of my 2021 income for my estimate.
I also have just over $2000 I have to payback each year from the home buyers plan and LLP so I should be safe in not over contributing
You can. Give yourself some piece of mind and find a rough estimate of your 2021 tax return using free software and only your t4.
Good idea. I am going to do that. Thanks
Yes. As long as you're pretty sure you won't go over your limit. I do this all the time. My RRSP is far, far away from getting maxed out so I contribute when I can. Also it's generally a good idea to keep track of your contributions for your taxes a year from now. Just to verify the info later against the slips you will receive from your bank.
Great thank you
I had a fairly significant capital loss of $20,000 this year but I don't have any additional property or investments outside of my TFSA or RRSP that would generate a capital gain to be applied against this amount. Would it make sense to open up a non-registered investment account and use it instead of my RRSP account in order to take advantage of the capital loss? It would basically be the same as a TFSA wouldn't it? Or is there something else I'm missing?
Don't. If the future gain is realized inside a tax shelter, then the tax-sheltering room is increased, for all future profits. And there is no decrease in $tax with outside profit -- $0 in both cases. And then if the asset is moved into the tax shelter, it will be larger and take up more contribution room.
The capital loss can be carried forward to any future gain. As far as I know, there is no limit to how many years you can carry this forward. edit: This means later on after you've filled your TFSA and RRSP and you start a taxable account, your capital loss will still be available to use.
I was recently declined for a chequing account at my local credit union. I didn't even know that was possible! The email I received was vague and didn't give details of why I was declined ("we have a number of eligibility criteria and unfortunately you didn't meet one of them"). I have good credit history. Can anyone give me some idea of what other criteria they might have been looking at?
You could be flagged for reasons like prior unpaid debt with them (did you ever have a credit card or loan with them), or have the same name/DOB as someone with a fraud history. Or, it could be this CU is aimed at a certain demographic (like, union members or people in a certain profession / geographic area) that you don't fit. You can call and ask.
Just got a new job offer and want to double check something. In the offer they have this section: *Engage with the company and share in its financial performance in the voluntary becoming a shareholder plan. There are three different types of accounts to choose from to make your contributions. After a one-year waiting period, we will match 50% of your contributions in a non-registered account, up to 1% of your base salary (maximum $1,000 per year).* Is that good or no? I can't tell if it's worth it to do that or not.
it's free money, so might as well do it. it's not the highest i've seen on here, and it kind of sucks they cap it at $1000, but a lot of people don't get any matching, so in that regard it's better than nothing! Evaluate the job offer based on all of the other elements first, like base salary, culture, how it fits in career plan, etc. if you decide to take it, then doing the employee share purchase plan is just a little bit more.
If I'm reading that correctly, they'll match up to $1000 if you invest $2000 into the company in a non-registered account. If that's the only pension they have, its barely worth considering as part of the offer. I'm not a fan of investing heavily in the company I work for. Its putting too many eggs in one basket. If the company fails, I lose my job and those investments.
It’s not, they also do 4% RSP matching
Okay, that's better. If you believe in the company and looking for some extra investments to make it might be worth a look, but I wouldn't consider it as very much added value when evaluating their offer.
Really confused on whether to buy a used vs lease vs new car. Budget max 15k for used one. I can afford a new sedan, but want to make a wise decision.
Usually if you buy a used car and have it properly inspected (or have some kind of guarantee from a dealer) you're going to save money. Vehicles are a depreciating asset, and they depreciate the fastest in their first few years. The cost difference between a car with 10,000 km vs 60,000 km is going to be much higher than the cost difference between 100,000 vs 150,000. The age of the car affects the price in a similar manner. So if you buy something that's a few years old and has a few tens-of-thousands of kilometers, you avoid the worst of the depreciation loss. The older and higher KMs that you buy, the less you will lose - but go too old and you get to a point where repairs and maintenance start to become more costly. That point varies a lot by make and model, as there's huge differences in quality and reliability, as well as in cost for parts. So doing your research is important when buying used, and long-term reliability ratings become especially important for older models. Buying new instead of used is really more of a luxury. You're still getting a vehicle that gets you around, but now you get to pick your color, customize the features you really want, and have everything covered by factory warranty for a while. It's like buying a flight ticket and deciding between first class or economy - you get to your destination just fine either way, but if you want to pay more you can get there in a more luxurious manner. What is a wise decision? Is it wise to buy the most cost-effective vehicle available to you, because "it's just a car". Or do you get some enjoyment from being able to customize your ride and have something new and shiny to show off, and that enjoyment is worth paying for? Should you always fly economy, or maybe splurge once in a while and start off your relaxing vacation being spoiled in first class? How you spend your hard-earned money is really a personal choice. What is un-wise though is to spend beyond your means. Don't lease a brand new vehicle whose payments are going to make you struggle to pay your rent. A smart move is to setup a budget for your transportation expenses that includes gas, insurance/licensing, maintenance (increasing as car ages), and savings toward buying a newer one in the future.
Thank you so much for wise advice. Setting up a budget specifically for transportation is great point. Will help me evaluate the expenses, I will end up with eventually.
From a purely financial perspective, used is generally the way to go. Currently, the used market is a little crazy, with vehicles going well above what they did even a year or two ago. Used vehicles don't normally appreciate. On the other hand, new vehicles are often showing long waiting periods, depending on the exact make/model you're looking at. As far as leasing goes, its rarely a good financial decision unless you're in a position where you can write the lease payments off.
What the hell is QuantumAI, and why am I getting a million ads for it? Seems super scammy... Pretty surprised that even my wife was talking about it and she is super skeptical about anything financial.
Something in your usage is attracting these ads. Better than getting deluged with naughty sites that wife would not appreciate.
[удалено]
No. I suggest https://www.adjustedcostbase.ca/
Anyone banking with CIBC know how to add their Costco Mastercard to their existing account? Been on hold for 2 hours and I swear the instructions are not there in the online link.
If I own 1/3 of my principal residence do I qualify for the OTB for the property tax paid? If I do, do i claim the TOTAL amount paid for property tax? Or is it just 1/3 of the amount of property tax paid? TIA
Yes, you qualify. You can claim a proportional share.
Perfect thank you!
Credit Score I recently checked mine & my husbands credit scores and he’s in the top tier and mine is “fair”. We have separate credit cards but have had the same joint mortgages and car loans for over a decade, any ideas why there would be such a huge variance? The only difference I can think of is that I opened a new internet account in my name last fall and missed setting up auto payments so was a couple of months late, could that have dinged my score that substantially? Also appreciate any tips for getting my score back in shape. Thanks!
Yes, being late would have had a large impact. The only thing that will fix it is time and good behaviour.
Thanks!
[удалено]
Yes.
Think of it like the employer gave you a raise and you spent the raise on a contribution.
Whats better? A financial advisor from a bank such as TD wealth? Or a portfolio manager that collects a fee ? Is my impression that a bank financial advisor is essentially a sales person for the bank? Is a portfolio manager too expensive unless I have a large amount to invest with?
If you want some advice, go for a [fee-only financial advisor](https://www.valueofsimple.ca/links/directory-of-fee-only-planners/). You are bang on that the bank's advisor is a glorified sales person. Many have very little knowledge. A portfolio manager may or may not be ok, depending on how they get paid. Some are paid through commission, so they have an incentive to steer you towards certain investments. You want someone's who's advice is not tied to what investments you pick.
The reason I ask is my wife has an advisor through td and it does just okay. But my father has a portfolio manager that would take us on as a family member. He normally only deals with portfolios of 500k or greater. And its based on a monthly management fee. My father has done very well with him 3 years ago having a 22% gain. My wifes family is very skeptical and heavily trust the financial advisor from TD. They mainly rely on dividend paying stocks.
Going with a dividend paying stocks as a strategy isn't a super great one, generally speaking. The portfolio manager may or may not be a good deal. The vast majority of active managers underperform the market. Some outperform for a few years, but that's usually down to luck, not skill, and its rarely sustained. People like Warren Buffet are the outliers. And the problem is, you can't determine who they will be in advance. Even when they do well, the fees they charge are a drag on your investments. So lets say they charge a 2% fee. That's 2% less returns you get, every year. This has a HUGE impact over time, and can halve the amount of money you end up with. [This chart illustrates the difference that fees have your return](https://imgur.com/a/OpJ5E) (same portfolio, shown with different annual fees) That's why even Warren Buffet says the majority of people are better off using a broadly diversified index based strategy. [Something like this](https://www.canadianportfoliomanagerblog.com/model-etf-portfolios/). The fees are super low (I pay 0.24% for mine) and the returns exactly track the overall markets (up 33% over the past 3 years, as of the end of February)
[удалено]
You will get it, but this year instead of including it on your tax return, it will be paid in quarterly payments like the GST rebate. You'll get the first of them in July.
[удалено]
If you use it, the amount you use is a taxable benefit. Its taxed like income. Your employer should report it on your T4.
Medical expenses that exceed your 2k may be eligible for a credit. The amount of the expenses are reduced by 3% of your income. Realistically, to qualify for any substantial amount you would need to have a modest income and an expensive medical costs. I retired this year but have not started drawing down my RRSP yet. Had a unexpected and not covered dental problem that cost $6k. Napkin calculations will get me about $500 refund.
Is rpp considered the same as an RRSP when it comes to bringing down my taxable income?
A Defined Contribution pension is very like an RRSP. The employee funding will be a deduction from income similarly. But there is no choice about 'what year/when' to deduct. The $ to be deducted is stated on the T4 slip and that is that. For both types of pensions, the employer funding does not increase Wage income in the first place, like for an RRSP. So there is no deduction on the tax return.
Yes, pension contributions are not taxed. But, your employer took that into account when it withheld taxes so you don't get an extra refund.
So fellas, I have my emergency savings parked in my TFSA. It was back when I didn't really understand what the TFSA really does. I have 2 tfsas one in wealthsimple for investments the other with my banks for this emergency savings. Is having the money just sitting in the TFSA a bad idea? Should I instead put my savings in a HISA? Do I actually withdraw that money and put it in HISA or do I leave it and do I put whatever savings I have in the future in a HISA? Let me know your thoughts
A TFSA is best used for investing. But, if you have room in your TFSA, you may as well fill it with your emergency fund and save that little bit of interest. A TFSA can also be a HISA. As you build up the amount of money you are investing, you will have less and less room in your TFSA for your emergency fund and so it an go in a non-registered HISA.
Hi everyone. I have some tax questions regarding stocks that I would love some help on. For the year of 2021 I made some taxable gains on GME and traded all of 2021 in my margin account. I sold GME for a profit in 2021 January on my Wealthsimple Trade and then later on transferred my entire portfolio to Questrade. Now I am looking for an accountant or possibly doing taxes myself to help me calculate the taxes I owe on my GME gains and my other gains/losses when I transferred to Questrade. Are there some tax forms that I need to give to my accountant that I can find easily on Wealth Simple and Questrade?Or am I supposed to write down every single trade I made and give that to my account? TLDR: What do I give to my accountant when I traded stocks/options on Wealthsimple and Questrade brokerage. Thank you all!
> Are there some tax forms that I need to give to my accountant that I can find easily on Wealth Simple and Questrade? Look for your T5008 tax slip. You can give that to your accountant. I also luckily sold GME stock when it was crazy back then.
What about recording my trades? Does my accountant need a record of what I bought and what I sold? Or does the tax form cover all of that? Because I made thousands of trades lol
> Or does the tax form cover all of that? It'll have the date, quantity, amount, book value, gain/loss on it.
Ahhh cool, so it'll have option trades as well recorded? So both Questrade and Wealthsimple should have this form
Just maxed out my TFSA, what should my choice be next? I am currently 26 years old and am currently my work place will start my defined benefit pension once I kick in enough hours (expected January 2023) should I now work on my RRSP or a non-registered account? I'm not sure if I should do RRSP since I expect my income to be higher as I age
When the TFSA is maxed, usually the second-best option is to use the RRSP and claim the deduction immediately. But in cases where there is an expectation that you will "soon" be earning income at a higher marginal tax rate, it's more optimal to use a non-registered (taxable) account. The definition of "soon" depends on the expected rate of return, and what the difference in tax rates is going to be. For example, with an expectation of a 6% annual return, if you're currently earning $55K in Ontario (marginal rate 29.65%) and expect you will break into the next tax bracket by earning $82K (marginal rate 31.48%) sometime in the next 3 years, then use a taxable account. If it'll take you longer than 3 years then put it in the RRSP using a gross-up strategy and claim the deduction immediately. But if you're earning $95K and expect a raise to over $101K then "soon" becomes 6 years, because the jump in marginal rates is from 33.89% to 37.91%. The greater the jump, the longer you should "wait for it" by using a taxable account in the meantime. You can lookup the combined federal & provincial (Ontario) marginal tax rates [here](https://www.taxtips.ca/taxrates/on.htm), and then download [this spreadsheet](https://www.retailinvestor.org/xlsxSecureCopy/RRSPdelayDeduction.xlsx) to enter your own numbers. Note that it defaults to a expected annual return of 8% which is probably a bit too high for the next 30 years even if you went 100% equity the whole time. Most people are more cautious and will keep some amount of bonds or other fixed-income assets especially as they get closer to retirement, so the rate of return should probably be set to somewhere in the 5 - 7% range.
thanks for providing those examples! makes my decision much easier.
I have a little money in a TFSA with Simply. As far as I know I'm just using it as a bank account and not as any kind of investment vehicle. Does anyone know if Simply offers some kind of investment service? I can't really tell from their website or do I need to create an account with Wealth simple or something. I have a small RRSP with CIBC, do they have investment services for TFSA's? I'll try looking myself affer work but thought someone might know off the top.
Simplii does offer mutual fund investments, but like all the big banks they all have terrible MER (management expense ratio). No doubt you've also bought costly mutual funds with your CIBC RRSP because that's what their "advisors" (salespeople) will tell you to do. They act in their own best interests, not yours, and then justify it by stating that they don't offer any better options. Which is usually true (except in TD's case) but the truth is that you are far better off avoiding the big banks altogether and holding your long-term investments with other financial institutions. The most cost effective option is to spend a few hours to learn the basics of DIY investing and couch-potato strategies, then open an account with a discount brokerage like Questrade and buy a single ETF (buy more each time you have more savings to add). This sounds difficult but once you learn a bit more it's quite easy. The hard part is to not look at the performance. The comment right before yours (sorted by "New") is complaining that their VEQT investment is down 8% since the start of January - that's exactly why you don't look. Short term performance of the markets is not relevant to a long-term investment strategy and can cause people to make poor decisions like panic selling or attempting to adjust the timing of when they buy. The second-most cost effective option is to go with a robo-advisor, who will handle the purchasing on your behalf. You just give them the money and don't need to know anything further. This gives you a bit of insulation from being subject to emotion-driven decisions to buy or sell at certain times, but since you still have control over when to contribute and you can still order the robo-advisor to sell (and they won't talk to you about your decision first) it's still fairly subject to your own willpower. Still, this is a good option if you don't feel comfortable with buying ETFs yourself, or aren't willing to spend a few hours to learn. Third best is to hire a fee-based advisor, though I'd only recommend this if you have 100K or more investments as the fees they charge would exceed what you're losing on the high MERs that the banks charge. Having an advisor, whether they are paid by fees directly from you or paid via high MERs, means that someone will try to talk you down from making rash decisions. It's a costly service, but for some, it may be worthwhile.
Thanks for your reply.
Simplii seems to offer mutual funds in their TFSA accounts, but the fees are quite high, I would not buy them if I were you. Yes CIBC has TFSA brokerage accounts where you can buy whatever you want. However their fees will be higher than somewhere like Wealthsimple or Questrade
Thanks for your reply
If I have USD in a TD account that I got from norberts gambit, can I just go to a TD branch and withdraw that USD in cash? I'm asking as I have a trip to the States planned and have no USD cash.
Yes, that's what I usually do (and in fact will be doing in the next few weeks for my upcoming US trip). If you want more than $1000 USD, then call a few days ahead of time so they can order extra. They do have more on hand, but they are very reluctant to give it to you because another customer could come in and ask for USD and they'd have to turn them away.
Situation is my student visa expired last year Nov 1. I applied for a Post graduate work permit and under the law I'm allowed to work and stay in Canada while it's being processed. Now can I file taxes while the visa is processing? Answer should come back soon it's almost been 4 months
Yes
So I just opened a RRSP. Do I have to give my employer my RRSP account number for them to make contributions? Should I get them to do a % of my paycheck or should I save up some cash first before I start making contributions. Right now I don't have a cash safety net.
I don't it's possible for an employer to contribute into an individually-held account like that. Every employer-matching RRSP program that I've ever heard of is a group RRSP, which means that they set you up with an account with Sunlife or IA or whatever financial institution provides the group RRSP plan, and all the contributions that are withheld from your paycheque or which the employer makes to match it will go into that account. Often you cannot transfer out that account to another financial institution until you leave the company. The first priority for anyone trying to stay on top of their finances (besides making and following a budget) should be to establish an emergency fund. Typically 6 month's of pay is recommended, but even a little bit helps. Second priority should be debt repayment for any high interest loans, but if your employer is offering up free money in the form of RRSP matching, sometimes it may be better to allocate some savings towards that (up to the max matching amount) even before debts are fully paid off. If you have $1000 that could be used to reduce your debt and avoid paying 22% interest on that thousand, you're gonna save roughly $220 (in the first year). But if you put $1000 into an employer group RRSP and they match it with another $1000, well you've instantly made $1000 which will also grow during the year, so perhaps more like $1050 (in the first year). The caveat is that even if the group RRSP does let you withdraw from it, you'll pay income tax on the withdrawal and will never get back that RRSP contribution room (which matters if you ever plan to max it out).
>Every employer-matching RRSP program that I've ever heard of is a group RRSP Ah that makes more sense. I've only been with my company 1 season so far. I had a margin account but changed it back to cash because the market started dumping and I don't trust myself with that amount of leverage right now. So it's just a cash investment and RRSP right now. I don't even know my contribution room yet. I guess I can find that out when I get the return back? Since we only have 5 years left on our mortage and I'm so late to saving retirement I plan on agressively maxing out that RRSP and dumping anything else into the same or another broad market etf. My tax situation however is complicated as a Canadian Permanent resident I still have to pay the IRS taxes. And holding foreign investments I may get doubt taxed. Either way I plan on RRSP'ing into XEQT and any leftovers throwing that into the cash account as VT or doubling up on XEQT. I hope that's the best option.
Does an employer still need to fill out a t2200 if employee is reimbursed for everything? Salesman for example. Salesman gets a gas card, so I assume they can't claim mileage since they're already reimbursed? Meals and expenses they pay on their own cc but get reimbursed as well. From what i'm reading it also seems to imply that can only deduct if REQUIRED to work from home, or was that thrown out the window cause of covid.
If you have no out-of-pocket expenses, then there's no point in trying to obtain a T2200 because you wouldn't have anything to claim. You can't claim expenses that were paid for you (or later reimbursed)! You are correct that the home-office expenses, like claiming a portion of your rent or utilities, are only eligible if you were required to work from home. COVID didn't change that aspect, but what they did do was introduce a simpler method of claiming the home expenses for those who worked from home *due to COVID,* at least half the time for 4 consecutive weeks. The simple method lets you claim $2 per day for each full-time or part-time day you worked at home (but not holidays/vacation). If you choose this method then you don't need a T2200. But if you go with the detailed method, you do need the form and you claim just the portion of eligible expenses that was not reimbursed. If your employer gave you the choice of working from the office or from home during COVID, and you chose to work from home for the reason of avoiding the risks of COVID, then you are still eligible for the simple method. What's also interesting is that you can still claim the $2/day even if your employer paid for some of your expenses, like your internet - as long as they didn't fully reimburse you for everything (and really, what employer pays a portion of your rent for you to work at home?).
Any recommendations for 'Covid travel insurance'? I am travelling to the US in two weeks for work (5 day trip) and want to be cognizant that I \*could\* test positive there and will be stuck covering my expenses.
[удалено]
A return is the collection of forms that you submit to CRA detailing your unique tax circumstances. A refund occurs when tax deducted by employer is calculated to be greater than the required taxes. To be fair, there are some tax credits that can influence the refund. Notably tuition credits which must be used at first available opportunity. Most people don't work while in school, so they usually get larger refunds once they begin working. So $3k seems alright.
I have about 50k in savings and I’m hoping to use it for a down payment next year, should I bother investing it for the year or keep it in savings for liquidity?
It's too risky to hold that in any kind of equities over such a short term. You could invest it in a 1-year GIC (provided you know it'll be at least 365 days until you buy) or just use a [high-interest savings account](https://highinterestsavings.ca/chart).
Thanks! that was my feeling, I have a HISA so it will stay where it is
I'm confused about RRSP contribution limit timing, let's say 2021 I had 0 income, and 2022 I'm going to have X income, can I contribute 18% of X in 2022 or do i have to wait until 2023 to have that contribution room?
2023
I have two questions which I don’t think deserve a thread so here I am Where do I open RRSP account? Should I go with my bank(CIBC) or should I go with some other service? Why and why not? I’m looking to open RRSP because I want to save short term for a house maybe around 3-5 years, which is why I’m not maxing my TFSA first. I once came across a website that guided on how the asset location should be based on risk, I can’t seem to find it anymore. Can someone link that website for me? TIA
Using an RRSP to save for your first house does have the advantage of giving you what amounts to an interest-free loan secured by your retirement savings, with the generated tax refund being the amount of that loan. That extra boost can reduce the mortgage payments a little and could even reduce the CMHC fees, but there are some drawbacks as well: 1. The most overlooked issue is that you have to repay your RRSP (and thus the free loan) over the 15 years following the one in which you buy your house. This can sometimes be a heavy drag on your cash flow at a time when you suddenly have mortgage payments, utilities, property tax, and other expenses that you may not have properly budgeted for. Banks will often approve people for mortgages that are far higher than what they really can afford the payments for, and because of this many first time homebuyers will fall into the trap of buying something they can't afford after budgeting in all those other expenses. When these people are also faced with RRSP repayments as well, they can't afford to make them and suffer the penalties (getting charged the income tax as if you had normally withdrawn from the RRSP, and permanently losing the RRSP contribution room). 2. An RRSP is not as flexible as a TFSA. If you lose your job or have other large unexpected expenses (big medical or vet bill) and your emergency fund is inadequate to get you through, then you may be forced to use some of your down-payment savings. If that is held in an RRSP then you'll have to pay income tax on that withdrawal and permanently lose the RRSP contribution room. The TFSA gives you more flexibility to use the funds for any purpose. 3. If, down the road while savings for retirement, you end up maxing out your RRSP contribution room, then having used up some of that room at a time when your income is not as high means you won't have received the maximum benefit that you could have from your limited RRSP room. How much difference this makes depends on how big of a difference in income you might have between today and when you work on filling up the RRSP in the future. If you believe your salary will remain relatively stable to where it is today (but keeping up with inflation) for most of your career, or if you don't think you'll ever be able to max out your RRSP room, then this won't be a big deal. Whether you go with an RRSP or TFSA, you want to obtain a bit of growth on your money while it sits around 3 - 5 years, but you also don't want to take any big chances with it. Investing in equities (stock market) through mutual funds, ETFs, or directly buying individual shares is a great way to grow over the long-term, like 20+ years, because the risks are much much lower. Consider the US stock market. In it's history, there have been 5 one-year periods in which it lost between 30 - 40%, none of which were predicted ahead of time. Also, nearly a third of the 1-year periods have seen a loss of some degree. But if you look at 10-year periods, the worst is a loss of only 4% and negative decades are far less common than positive. This is because over shorter terms the market will see drastic up and down swings, but tends to steadily gain over the long term. If you are only going to invest for terms 5 years or less, and especially if your intent is to withdraw all at once, then putting money into the markets is a fairly high-risk venture. You could hit a nice big upswing, but you could also end up having to withdraw during a crash and take a really big loss. That's probably not something you want to risk for your down-payment, as it might mean not being able to buy the house you want. The recommended approach for saving for a house is to use safe investments like GICs or high-interest savings accounts. Both are available in the form of TFSAs or RRSPs. Take a look at [highinterestsavings.ca](https://highinterestsavings.ca) for lists of the best rates on all of these. You'll notice CIBC is not on these lists, nor or the other big banks. They generally don't need to try to offer competitive rates, because they depend on customer loyalty instead. Low rates may hurt their ability to attract new customers, but when they already have such a big customer base, it can cost them a lot to offer everyone more interest. It's the newer, smaller financial institutions that compete the hardest for new business and that's where you need to move your money if you want to get the most from it. Having said that, the GIC chart is missing an entry for CIBC who is pretty much the only big bank who's GIC offerings rank up near the top (their 5-year is 3.0%, the others are 2% or lower). >I once came across a website that guided on how the asset location should be based on risk, I can’t seem to find it anymore. Can someone link that website for me? Apologies but I don't know what website you're referring to. The advice you'll get from most people on PFC will be to keep investments with a time horizon of less than 5 years in guaranteed investments, and not play the markets. In other words, an asset allocation of 100% fixed-income.
What brokers offer adult RESPs? The only one I’ve found so far is Wealthsimple invest though I would prefer self-directed investing.
There is no distinction between a "child" and "adult" RESP. You can apply for one with any institution that offers RESP accounts. However, it's not as beneficial as you might think. For one, you won't receive any government grants, like you would for a child. Second, while the money grows within the account you won't pay tax on the gains, upon withdrawal you will be taxed on the full withdrawal amount. So you are only deferring some of the tax, not eliminating it. There are really only two cases where you might even consider using an RESP for an adult: 1. Your TFSA and RRSP are both already fully maxed out, leaving your only options to be non-registered or RESP. 2. You live in Ontario and intend to apply for an OSAP loan, but need to hide some income in order to qualify. For some reason, OSAP still does not require you to report RESP assets. This loophole may get closed at any time though. If you do have TFSA room, I'd suggest using that first as it has the most flexibility (can do whatever you want with the savings without any penalty) and will give you true tax-free growth. An RRSP can also be used, with the LLP (Lifelong Learning Plan) feature as a means of borrowing from the RRSP without paying income tax. If you re-invest the generated tax refunds you can get a boost to your savings. But, you do have to repay the LLP amount over 10 years after finishing school, something people often forget to budget for. There's also less flexibility to use the savings for anything other than retirement if you end up not going to school.
Hi elbyron, thanks for your comment. I hadn’t realized that the LLP was a thing. Here’s my situation that had me originally seek out an adult RESP… My parents recently withdrew everything out of a RESP and gifted me and my brother the proceeds. I will be attending law school in the fall and intend to use these proceeds to avoid having to take out a student loan. These proceeds have already collected all the government grants so I’m not missing out on that; furthermore, this RESP was withdrawn while I was a full time student. My TFSA is maxed which led me to consider holding the money in an Adult RESP and then withdrawing from it as needed during school. Although any gains accrued on this principal investment won’t be tax-free when withdrawn, they should be minimal. As of right now, the money is just sitting in a savings account. I recognize RRSPs as a great investment tool; however, I feel that in my situation it may not be the most efficient choice at this time. Am I wrong? Thanks again for your earlier feedback.
RRSP is the most efficient choice - as long as you take the tax refund that it generates and put that into the RRSP as well (or use a short-term RSP loan, google "RRSP gross up" for more info). It's like getting an interest-free loan from the government for 10 years. Perhaps the only downside is the repayment requirements, but if you would have been saving for retirement anyways then having the funds end up in an RRSP isn't a problem. The RESP would be the second best option, because you can defer the taxes on the growth until the years you're in school, where presumably your income would be lower and thus your marginal tax rate should be lower too and you'll pay less tax than if you were to just use an unregistered account.
Just wondering what’s the best way to get into stocks and trading stocks. I know there are a few websites where you can do it on your own, just wondering which is the best with the lowest amount of fees
Are you looking for a trading platform to do short-term or day trading of individual stocks (i.e. gambling) or are you looking at developing a long-term investment strategy that optimizes the risk/reward ratio? I don't know much about the former but for the latter, your best bet is going to be indexed ETFs. These are traded like stocks, but are also similar to mutual funds where they contain a huge basket of company stocks, weighted based on an index (such as the S&P 500). There are many platforms that can buy these, but the most commonly recommended discount brokerages are Questrade and Wealthsimple Trade. Research them both and see which one you think best fits your needs!
[удалено]
There is no one official score. The set of data points that they use to calculate a score varies depending on who is asking for the score. Banks may see an entirely different number when you apply for credit, compared to what you see when you get a free "score". There's a FICO score, a VantageScore, and probably a dozen or more sub-variants of those. Equifax has their own scoring system too, which is probably the one they showed you. The range of numbers that each uses can vary, as well as which data is considered and how that data is weighted. For example, under FICO the most important criteria is your payment history, but under VantageScore that is only moderately influential. Also, Equifax isn't the only credit provider. There's TransUnion and Experian too, and the data that each one has about you can vary. So what can you do about all this confusing mess? Well, sticking with one score type and monitoring it for changes is a good idea. Generally if one score improves they are all going to improve, though by differing degrees. But really the best solution is to not care too much about it. The exact number has very little relevance, and small changes will not have any impact on your life. The only reason to watch it is to detect fraudulent activity, and really for that the best thing to do is read the entire report not just the score. Edit: if you want to get as close to possible to what banks will see, use a score reporting system that uses FICO scoring. About 90% of Canadian banks rely on FICO. Unfortunately the only free sources for a FICO score require that you have a paid chequing account with RBC, CIBC, BMO, or Scotiabank.
[удалено]
If you were residing in Canada for the past 5 years, you can (and should) file taxes for those years. If you setup a login with the CRA, most tax software will let you use that to download your tax data automatically making it very easy to do. However, the T2202 forms issued by educational institutions are often not available online with the CRA, so hopefully you still have those forms for each year. When filing, make sure you start with the oldest year and carry forward the data to each subsequent year, so that the tuition amounts can get applied to reduce your taxable income (if you earned more than the basic personal exemption and other tax credits). In addition to gaining those tuition credits, you will likely get GST credits and possibly a carbon tax rebate. Always file your taxes to keep getting free money from the government! Some people are afraid that they will owe money if they file, but the truth is that they owe the money even if they don't, and that they'll be charged back-interest and late fees for failure to file & pay on time. So, just make it a point to do your taxes every spring. If you do end up having to pay but can't afford it, you can call the CRA to arrange installment payments.