Publication assists in
planning tax strategies

KEEPING UP with tax rule
changes is) an unending
task.

Yet you must Stay current to
make sure (1) you don’t miss any
credits or deductions and (2) you
report the correct income and pay
taxes on time to avoid unexpected
penalties and interest charges.

Price Waterhouse, chartered ac-
countants, have just published a
108-page large-format book, Per-
sonal Tax Strategy, 1992-93.

The guide, available free to the
firm's clients and contacts,
focuses on employees, owner-
managers, investors, retired peo-
ple, separated/divorced people,
taxpayers with U.S. connections,
and calculating your taxes and fil-
ing your return.

It also inctudes a helpful sum-
mary of tax changes (some still in
the proposal stage following the
last federal budger) and their im-
plications. I’ve expanded on some
of the points and added others.

Until March 1, 1993, you may
take up.to $20,000 out of your
aerial leer

7; If you do get a
refund, Revenue Canada
. will pay interest only after
June 14, instead of
after April 30 as in
the past. 99

RRSP free of tax to build or buy
a principal residence.

(As mentioned in an earlier col-
umn, this will restrict your ability
to make a deductible RRSP con-
tribution for the 1992 tax year.)

You must repay the money over

18 years; any missed payments
will be added to your income and
taxed.
@ The registered pension plan,
registered retirement savings plan
and deferred profit sharing plan
contribution limits for 1993 will
be the same as for 1992.

To make the meximum $12,500

RRSP contributions for 1992 and
1993, you will need earned income
of $69,444 in 191 and 1992,
respectively.
@ If you receive CPP disability
income, this now qualifies as
earned income on which to base
an RRSP contribution, effective
with CPP disability income
received in 1991.

Michaei
Grenby

DOLLARS AND SENSE

® A registered retirement income
fund may be used to provide
payments for you or your spouse
untii death; under the old rules,
age 90 was the limit.

Converting an RRSP to an
RRIF before Dec. 31, 1992, will
allow smaller minimum
withdrawals until age 78 — but
taking money sooner than re-
quired mighi increase your total
income tax bill over the life of the
RRIF.

(Note that Revenue Canada has
just published its 68-page 1992
Pension and RRSP Tax Guide,
which also deats with RRIFs. You
can get a free copy by contaciing
your local tax office.)

@ If you have defaulted on stu-
dent loans or haven’t repaid
unemployment insurance benefits
as required, Revenue Canada will
deduct these amounts from any
refund you might otherwise be
expecting.

@ lf vou do get a refund, Reve-
nue Canada will pay interest only
after June 14, instead of after
April 30 as in the past. If you file
your tax return after June [4,
then interest will be paid only
from that date.

@ Common-law spouses will be
treated as married spouses for tax
purposes starting in 1993.

That means, for example, you

may make spousal RRSP con-
tributions and claim the marital
tax credit, but it also means in-
vestment income and capital gains
might be attributed back if one
spouse lends or gives money to the
other.
@ The Chiid Tax Bencfit system
will replace family allowance
payments and the various child
tax creclits starting in January.

The monthly benefit will depend

are moving!
from: 950 - 409 GRANVILLE

TO
Suite 888
1185 West Georgia
Vancouver, B.C. V6E 4E6
Effective Nov. 30th, 1992

For further ntorrnation 687-451 I

Fax: 687-5617

on family income and the nunsber
of children.

Investing this benefit in the
name of the child (or in your
name in trust for the child} means
the child (instead of you) can
declare the investment income and
so will pay little or no tax — the
same approach that worked for
family allowance cheques.

@ You may no fonger use the
$100,000 capital gains exemption
to escape tax on gains you make
on investment real estaie (in-
cluding recreational property)
bought after February, 1992. You
may still use at least some of the
capital gains exemption for prop-
erty you bought before fast
March.

@ Oiiawa is increasing for the
1992 tax vea: both the education
credit and the maximum education
and tuition fee credits that may be
transferred to a student’s support-
ing individual.

The federal credit for the
education amount rises to $13.60
a month (for a total tax credit of
about $21 a month by the time
you add the provincial credit).

The maximum transferable fed-
eral credit rises to $680, or a total
of about $1,071 after accounting
for surtaxes and the provincial
credit.

@ Revenue Canada will tell you
what quarterly installments you
need to make. As long as you use
this system and pay on time, you
will never have to pay interest or
penalties even if these payments
fall short of the tax you owe for
the year. However, vou may still
ealculate the installment payments
yourself if that is to your advan-
tage.

- Copyright 1992

Mike Grenby is a North
Shore-based columnist and in-
dependent financial adviser who
works with individuals; he will
answer your questions as space
allows — write to him c/o The
North Shore News, 1139 Lonsdale
Ave., North Vancouver V7M
2H4.

| MIATA CLE

LAST OF THE 92’S

| PERSONALIZED
CARTOONS

and
DOUGH CRAFT TEDDY
BEARS

A UNIQUE GIFT
FOR CHRISTMAS

Managing work flow. With the Motorola/
Radius P110 portable working on your team,
© Synthesized 2 that’s just what you can do. Use the P110's
or 4 channel talking power to help you stay on top of your
egeration 1 business by staying in touch with your crew.

These 2-way radios wiil help you work

=iz= smarter, faster, safer and more productively.

==— With Radius P110s on line, your staff will get

: the message without

having to drop vehat
they're doing.
You can't top the clearly
affordable Radius Pit0
for bottom-line value.
When you've got no
time for wasted time
... when you need a
productivity solution
now... then now's the

time to talk to us.

© Multiple-coded *
squelch capnbility H
© Quik-Gell N° on 4

S B.C. Communications Inc. |

340 Harbour Ave., North Vancouver V7J 2E9
985-034¢ apfax: B85-0943

°NO REASONABLE
OFFERS REFUSED

& Prices so low they
cannot be printed
$ Various models i in stock