S Save cash by gi GIVE money carefully to a spouse if you want to save tax. And beware telephone advice. “I have been buying Canada Savings Bonds at work in my name,” said read- er RS. north shore news “My wife has zero income. If [ switched the CSBs over to her name, could she then declare the interest? That way, she couid carn up to $538 a year tax- free without affecting my claim for her, “When T called Revenue Canada, they didn’t want to send out 4 written Marlin Y Su Son Sunday, July 12, 2 to 4 pm " You'll fall in-love with these Latin beats. You may even find yourself doing the mambo! OT ee ring this entry form in te Lonsdale Quay’s Customer Service Centre, and enter to ~ ‘win/a Summer Festival T-Shirt. Pick up a music “Passport” and get a chance to win the “Grand Frize mystery trip for two (Draw date September 7, 1998). No purchase necessary. , te , Naine: Phone north shore ‘footloose. Foot of Lonsdale in North Vancouver. 2 hourssfece with.validation on weekdays. For.more information call 985-6261 a7 eee * woe a ee pepeer ern rs BUSINESS ving it to your family reply. But from our conversa- tion, it sounded like this would be OK even though the funds to buy the CSBs come from my empioyment.” No, this approach won’t work. [F vou give money to a spouse to invest, you are sup- posed to declare the interest (dividends, rental income, capital gains, etc.) earned by this gift (or loan). (On the other hand, always keep track of capital originally earned, inherited, won, etc. by a low income spouse so that spouse declares the investment pro- ceeds from that capital.) To shift income to a lower-tax-bracket spouse, here are ways that escape the spousal attribution rule: @ Contribute to a spousal RRSP; you get the .ax deduction now, your spouse declares the RRSP with- drawals in the future. IB Give or lend money tu a spouse. You declare the investment proceeds but when your spouse reinvests these funds, he or she reports - « Wednesday, July 8, 1998 — North Shore News — 17 the second-generation invest- ment proceeds (in cffect, the compounding). @ Give or lend money your spouse puts into a business. She or he reports the busi- Ness income. “To shift income to a lower-tax-bracket spouse ... Pay your spouse to work in your business.” @ Lend moncy and your spouse pays you Revenuc Canada’s prescribed interest rate. This saves tax if your spouse can cari more than that loan interest. @ Pay your spouse to work in your business (self- employed sijcline, company, rental property). Make sure you pay him/her what you'd pay an outsider to do the same work. Pay regularly, keep records, withhold and submit tax and CPP premi- ums if required -— just the way you'd deal with an employee or contract worker. The same rules apply if you pay children to work for you. If you give money toa child in your family, you must report interest and divi- dends but not capital gains or losses produced by this money until the child turns 18. -— Copyright 1998 Mike Grenby Mike Grenby is a columnist and independent personai © _ financial adviser; bell answer guestions in this column as. space allows but cannot reply. ‘personally — contact him at © P.O. Box 50029, South Slope. R.P.O., Burnaby, B.C. Vj 5G3; e-mail mikeQgrenty.com pe ame and see previous Ce. Mike's website, wwwgrenby.com =: nS AE: Please join us, © Free Grand Opening te ‘VanCity Place For Youth Food and Refreshments Thanks to VanCity members like you, as well as __ many others in this community, VanCity Place For Youth is opening its doors this Sunday. With your generous support over the fast three years, VanCity staff were able to raise over $460,000 to help fund this much-needed facility. VanCity Place will offer street-involved youth access to the skills, services and education they need to get off the street and into a safer, more productive environment. It will also provide 50 units of affordable housing. Please join us as we celebrate the opening of this important addition to our community. Live Music Sunday, July 12, 1998 1:00 p.m. - 4:00 p.m. 326 W. Pender Street Vancouver For information on Together we are helping to build a better future for today’s youth. VanCity Place For Youth, call 877-7000 or visit our website: www.vancity.com VanCity It’s right here.