Your year-end financial to-do list
The holiday season brings much hustle and bustle – it's easy to get caught up and forget about some important financial deadlines. Regardless of where you're at financially, it pays to take some time out to make sure your financial house is in order.
Here's a list of to-dos that could help save you money and minimize your taxes:
- TFSA– If you haven't already done so, consider setting up a tax-free savings account. You can contribute up to $5,500 in 2016 with the total accumulation limit allowed currently at $46,500 ($5,000 for each of the first four years, $10,000 for 2015 plus $5,500 for each of 2013, 2014 & 2016). The Federal Government rolled back the contribution limit in 2016 to $5,500.
- RRSP – Contributions to registered retirement savings plans can be made until the end of February. However, if you turned 71 this year, December 31 is the last day to make a contribution to your own RRSP.
- RRIF Extra Payment – If you need to request an extra RRIF payment above the minimum withdrawal, you must submit it to the account custodian before December 31.
- Voluntary RRIF – If you are 70 or younger and want to arrange RRIF income, you must set up the RRIF and receive the payment by December 31.
- RESP – Be sure to contribute to your RESP by the deadline of December 31 in order to ensure you get the government grant. A $2,500 deposit provides the maximum $500 grant per child. Also, sure to start an RESP before your child turns seven in order to qualify for the $1,200 BC Training and Education Savings Plan grant.
- Tax loss selling – If you sold some investments at a profit this year, consider selling any poor performers to help offset your capital gains. You must receive the sale proceeds by December 31.
- Charitable Donations – This is the season to give generously, and you can realize tax benefits if you donate currently owned securities or cash directly to charities by December 31.
- Pre-Pay Fees – Pay safety deposit box fees, investment-related charges, professional fees, tuitions and political donations that you wish to use as a tax deduction by December 31.
For more information on these year-end tasks, talk to one of our professional financial advisors.