Pa Business

Tax changes could mean
bad news for pensioners

THE NEW RRSP and pen-
sion rules are going to dou-
ble Knud Neilsen’s income
tax.

“Last year, I paid $3,300,” said
the 65-year-old retired mining and
resource development consultant.
“My tax bill for this year -— 1989
— will be tk: same.

“But I just realized that because
of those new rules, my tax for next
year will be $6,000 — even though
my income won’t have changed.

“In 1990, it’il be the first time I
won't be able to knock $10,000 off
my gross income by rolling my
pension into my RRSP.”’

Neilsen is perhaps a little more
resigned to this change than most
Canadians with pension income.

“Um _ originally from Den-
mark,’’ said Neilsen. ‘There, you
pay an arm and a leg and the shirt
off your back in taxes."”

Although the new rules gov-

retirement savings .

erning registered
plans and pensions have been
delayed several times, the latest
news is that the proposed legisla-
tion could finally be tabled in
April or May. |

These changes are bad news for
people with pension income.

Existing rules allow you to put
up to the total amount of your
pension income (including Canada
Pension Plan and Old Age Security

pensions) into your own RRSP,
over and above the normal con-
tribution limits.

Depending on your present and
future income positions, that could
save you thousands of dollars in
tax. But after the end of this tax
year, you will no longer be able to
wnake such a rollover.

So 1989 is the last year to benefit
from this break. Now, some good
news: if you have a spouse, you
can benefit from an additional op-
Under the new rules, you will be

able to. put up to $6,000 a year of
your: private pension income (but
not CPP or OAS pensions) into
your spouse’s RRSP from 1989
through 1994.

You don’t have to contribute the
actual. pezsion dollars as you
receive them but could make a

. contribution of up to $6,000 from

other. funds — as Jong as you had
that much private pension income
in the year.

So over the six-year period, you
could put up to $36,000 into your
- spouse’s RRSP. ;

If your spouse will be in a lower
tax bracket than you when the

ATTENTION!

NEW TIME: 8:30 a.m.. 1 p.m.
and 7 p.m.

Forest Licence Conversion
Information Sessions to be held in

Vancouver, March 8, 1989, and
Parksville, Marct: 10, 1989

For more information
contact:

Vancouver: Regional Manager
4955 Canada Way
Burnaby
Phone: 660-7626

Parksville: Timber Harvesting Br.
1450 Government St.
Victoria
Phone: 387-5291

ia Ministry of Forests

dollars
and sense
Michael Grenby

eee

RRSP money is eventually
withdrawn (as cash or via a RRIF
— registered retirement income
fund — or annuity), this income
splitting/shifting wiil produce a
further tax saving.

If your spouse is considerably
younger than you, the money will
also be able to grow tax-free longer
than if it had been put into your
RRSP.

Even if you don’t have extra
cash, you could take up to $6,000
out of your RRSP and declare it as

RBC
DOMINION
SECURITIES

Meet the Challenge!
Be Computer-Wise in 1989

‘Introduction to Microsoft Word (OFTR 189)
Learn the basics of this essential program for
students, office workers, writers, and home
users. Begins March, 1989.

Earn credits toward an Information Processing
Certificate or take courses for general interest,
but CALL NOW: 984-4959. Classes fill quickly.

* Sued Funds are RRO! chpble and are uttered

income, then put the money into
your spouse’s RRSP and claim an
Offsetting deduction — again,
provided you had that much
Private pension income.

Actuary Don Smith, senior
vice-president of The Alexander
Consulting Group, pointed out
another change — one that has left
some people in a rather uncertain
position.

“Under the new rules, effective
Jan. 1 of this year, a lump sum
pension payout (following job
change or death, for exampie) may
be rolled into another pension plan
or RRSP, but it must be a direct
transfer,’’ said Smith, who helped
the federal government draw up
the proposed legistation.

“The goverament may introduce
some sort of relieving provision for
people who have received or inher-
ited a pension payout since the
beginning of this year,” Smith
said.

The new rules will allow you,
starting in the 1990 tax year, to
carry forward for up to seven years
unused RRSP contribution
“‘room.”” That means if you don’t
make the maximum RRSP con-
tribution which you are allowed,
you may make a catchup contribu-
tion later.”

Also starting in 1990, RRSP
contribution limits will be raised
for many people, especially those
who don’t belong to pension plans.

Let us straighten out
your investment portfolio.
Consistent long term
performance docsn't happen by

accident. Prudent and patient
management of client capital has

yielded impressive results.

THE SAGIT GROuP OF FuNDS®

“Trans-Canada Equity Fund
Cambridge Growth Fund
Cambridge Balanwod Fund
Cambridyy Res suroe Fund

by prosper tus onty

For further infarmation,
call Robert Wells cuflect
at (604) 661-2433.

31 - Wednesday, March 1, 1989 - North Shore News

WEATHER and the SOYBEAN MARKET
1988 DROUGHT = 1989 OPPORTUNITIES

The stage is set for dramatic price moves in the SOYBEAN
COMPLEX over the coming months.

Find out WHY and find out HOW you can profit through the
use of Options.

OPTIONS OFFER:

e Limited Risk ¢ High Leverage

Call or mail coupon below.

¢ Flexibility

Bahram Yeganegi
900 - 580 Hornby Street
Vancouver, B.C. V6C 3G8
~ 869-8797,

1 Please send me the 1989 SOYBEAN report
t Name:

' Address:

' Code

| Tel. Bus: Res:

' SUDLAND

'

'

!

OO Fry
Leeew ewe wow eno eo

JAPANESE IMMERSION
LANGUAGE CLASSES

Three Month Course - April 17th to July 7th

Learn to speak Japanese in a work/study program with 270

native Japanese students at the Canadian international

College in North Vancouver, BC.

Program includes:

- 3 hours of language classes per day with Japanese
instructors (15 hours per week)

- 3 hours structured interaction per day with Japanese ff
students (15 hours per week)

- Lunch and dinner in campus dining room

Limited enrollment is available for the spring semester —

f starting April 17th. Applicants must be 18 years of age or

older with University entrance Grade XII or equivalent.

u Residence space evailable starting April 1st. :

For further information write or cail:

CANADIAN INTERNATIONAL COLLEGE §

2420 Dollarton Hwy.
North Vancouver, BC. V7H 2Y1
PHONE: (604) 929-1544

aes ces

a
’
'
i]
i]
i]
i]
|
t
i]
all

‘A trained,

skilled work force

is fast becoming the key
element in ensuring that all
businesses—large and small—
can remain competitive, in’
both domestic and
international markets.

“'The Government of British
Columbia recognizes this
need, In order to stimulate
employer-based training, the
Provincial Government has
introduced the Training
Investment Program.

Hon. Stanley 8. Hagen
Minister

“The Training Investment Program provides up to
$50,000 to employers to cost-share direct training
costs.

“This Program gives employers the opportunity to
take what may be the first steps in the development
and implementation of a long-range training process
within their organization, or it may be the next stage
of an existing process.”

For more information, contact your local Job Training
Area Office and speak to an Employment Training
Counsellor. Check the Blue Pages of your phone book
for the office located closest to you. Applications are
available at Job Training Offices only.

Province of British Columbia
Ministry of Advanced Education
and Job Training, and

Ministry Responsible for Science
and Technology

a