51d965e0 
 XPost: nf.general, calgary.general, van.general 
 From: nospam@nospam.com 
  
 "LoneSailor"  wrote in message 
 news:0451ae55-cda5-4cd9-a487-8957d8df4513@z28g2000prd.googlegroups.com... 
 On Jan 9, 8:16 am, Alan Baggett  
 wrote: 
 > Canadian Tax Test Results :CRA SOTW 
 > 
 > Failing grade on the Canadian Tax Test 
 > 
 > Average taxpayer scored only three out of 10 when asked about common 
 > personal taxation rules, but the company that conducted the survey 
 > says that is because of the complex changes made to the system 
 > recently 
 > 
 > SARAH DOUGHERTY, Freelance 
 > 
 > When it comes to knowing about tax rules that could save them money, 
 > Canadians aren't making the grade. 
 > 
 > That's the conclusion of the Great Canadian Tax Test, a recent survey 
 > commissioned by mutual fund company Mackenzie Financial. The average 
 > Canadian got only three of 10 answers right on the survey of common 
 > personal taxation rules. 
 > 
 > But the failing grade doesn't mean Canadians aren't knowledgeable, 
 > said Mackenzie spokesperson Sandy Cardy. Rather, the results signal 
 > just how difficult it is to keep up with a changing and complicated 
 > tax code. 
 > 
 > "Even a genius can't keep up with the number of changes," says 
 > Mackenzie Financial's Sandy Cardy. 
 > 
 > €I think Canadians are becoming increasingly sophisticated and tax 
 > savvy, but they can't keep up with the changes," said Cardy, senior 
 > vice-president of tax and estate planning for Mackenzie. "The results 
 > show even a genius can't keep up with the number of changes and the 
 > complexity." 
 > 
 > This was the second tax test conducted by Mackenzie, whose core 
 > business is mutual fund management. The company also offers wealth 
 > management services. 
 > 
 > Mackenzie runs the tax test as part of the education it provides for 
 > both independent financial advisers and those that sell its products, 
 > according to Cardy. 
 > 
 > On the last test two years ago, the average Canadian turned in a 
 > better performance, correctly answering six out of 10 true-or-false 
 > questions. 
 > 
 > Cardy chalked up the score slippage in the test done this fall to the 
 > introduction of a number of tax changes in 2007. These include the 
 > right to contribute to an RRSP up to age 71 instead of 69 and the 
 > abolition of an annual contribution limit for RESPs. 
 > 
 > Other questions on the test dealt with income splitting, the carry 
 > back of net capital losses, gifts of publicly listed stock, tax 
 > credits for children involved in qualified physical activities and 
 > capital gains on non-registered investments. 
 > 
 > Cardy declined to speculate why there were regional variations in the 
 > scores - Quebecers scored the lowest, Manitobans and Saskatchewan 
 > residents the highest - other than pointing out one of the questions 
 > dealt with a rule not applicable in Quebec. (The other rules in the 
 > test apply across the country.) 
 > 
 > Cardy thinks it's more difficult than ever for individuals to do their 
 > own tax planning. "A few decades ago, it was easier to go it alone and 
 > maximize your credits and deductions," she said. 
 > 
 > In recent years, governments have responded to lobby groups by 
 > adopting a slew of new rules, according to Cardy. Seniors, for 
 > example, are benefiting from new income splitting provisions. Income 
 > splitting allows one partner in a couple to allocate income to the 
 > other partner to reduce taxes. 
 > 
 > Canadians are pretty knowledgeable about RRSPs, said Cardy, but tend 
 > to miss out on credits and deductions, income splitting possibilities 
 > and education planning strategies. 
 > 
 > Plain old procrastination accounts for part of Canadians' failure to 
 > be more proactive about tax planning, Cardy said. Information overload 
 > is also part of the problem; between the Internet, self-help books and 
 > business news on television, taxpayers are swamped with advice. 
 > 
 > Personal finance Average taxpayer scored only three out of 10 when 
 > asked about common personal taxation rules, but the company that 
 > conducted the survey says that is because of the complex changes made 
 > to the system recently 
 > 
 > Cardy's bit of advice is to hire a financial adviser, who can act as a 
 > quarterback, bringing in other experts (for example, insurance 
 > specialists and estate lawyers) as needed. 
 > 
 > Patricia Lovett-Reid agrees complexity is one reason Canadians neglect 
 > tax planning. She also thinks lack of time is a big factor. Lovett- 
 > Reid is a senior vice-president with financial services firm TD 
 > Waterhouse Canada Inc., a business television host and certified 
 > financial planner. 
 > 
 > "Tax planning is about doing a lot of little things right," Lovett- 
 > Reid said in a phone interview from her Toronto office. 
 > 
 > €When people are looking to put more money in their pocket, they think 
 > about spending less," she said. "Tax planning falls to the bottom of 
 > the list." 
 > 
 > When Lovett-Reid hits the road to talk about tax planning and 
 > investment strategies, she sums up the priorities with a series of 
 > tips. Here is her list: 
 > 
 > - Split income with family members. 
 > - Maximize contributions to your RRSP and any RESPs for a child's 
 > education. 
 > - Borrow to invest. 
 > - Where possible, buy and hold investments to defer taxes. 
 > - Invest in a home instead of making someone else rich by renting. 
 > - Use dividend-paying investments, which are tax advantaged. 
 > - Maximize tax deductions and employee benefits. The latter might 
 > include preferential mortgage rates and reimbursement for travel and 
 > meals. 
 > - If you can earn self-employment income, it opens up doors to lots of 
 > deductions. 
 > 
 > Aside from working with a financial planner, Lovett-Reid recommends a 
 > book published annually by the tax and advisory firm KPMG called Tax 
 > Planning for You and Your Family, which is available in book stores. 
 > 
 > Canadians might not see the immediate, tangible benefits of hiring a 
 > professional to help with tax planning, but the investment pays off in 
 > spades, Cardy said. "If they were to take advantage of all (the 
 > rules), it would have a dramatic influence on their future net worth." 
 > 
 > € The Gazette (Montreal) 2007 
 > 
 > --------------------------------------------------------------------------- 
 >  -------------------------- 
 > Miss a Tax Tale Miss a lot! 
 > Pop the link below into your browser to view the entire CRA SOTW 
 > Library!http://canada.revenue.agency.angelfire.com 
 > --------------------------------------------------------------------------- 
 >  ---------------------------- 
 > Alan Baggett € Tax Collector€s Bible 
  
 Not surprising. The tax code is so complicated and ever changing that 
 the regular joe doesn't have a snowballs chance in hell of 
 understanding it. Makes me wonder how many people are overpaying by 
 not taking advantage of the reduction strategies. 
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