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the HERALD Money Matters Wednesday November Yearend tax planning should be well underway By PAUL J Herald Special Important In Year End Tax Planning Fully half of all Canadians over the age of have never con to an according to a recent survey commissioned by a large trust company And per cent of those who do have one has less than saved Many of us are like ostriches we have our heads in the sand In spite of the millions of dollars spent by the government and financial institutions Canadians continue to procrastinate and find reasons not to contribute Almost two thirds per cent of those polled were not aware of the new limits Here are some of the items that should be taken into account in order to take stock of our in dividual tax situation and make plans wherever possible to reduce our tax This list is of a general nature for specific information talk to your tax advisor Determine Mix and Return If you have always invested in income related securities this may be the year to enhance the growth of your plan by adding long term equity investments Consolidate Into Self Directed Consider consolidating all those little plans you opened in haste as a result of last minute decisions into one or two self directed plans This will save on both administration and fees To avoid penalties tor cashing in early th s may requtrt a long term plan to move the funds on maturity dates of any debt in struments rather than before Plan For Current ear and Next ear Contributions Make this year s contribution now if funds are available rather than waiting until the deadline then make next year s tion as earl as possible to the compounding effect of the contributions The con but ion limit for is the lesser of and 18 per cent of 1990 earned income The con limit maximums will in crease by a year and in 1995 and will be indexed thereafter If you are a member of a registered pension plan RPP or deferred profit sharing plan ITS YOUR MONEY Paul J your contribution limit will be reduced by your Pen sion Adjustment PA starting in The PA is a measure of the benefits you obtained through the RPP and DPSP contributions in 1990 It was reported by your employer to Revenue Canada on your 1990 T4 slip Using this figure Revenue Canada v ill in form you in the fall of what your contnbution lit will be As the maximum is in 1991 you alwavs have avails I I to you a minimum of con tnbution limit each year The easiest method of making contributions to your while at the same time taming the accelerated ding effect is to make monthly contributions all year long This can be done through a PAC plan where the funds are automatical ly withdrawn from your bank ac count each month A previo is licle described how taxes i in be saved on an ongoing basis through reduced tax withholdings on employment income when a plan is used for RRSP con tnbutions Borrowing to make your ton tnbutions should only be con sidered if the loan can be repaid in a short time frame That way the deductible interest costs don outweigh the tax savings of theincome deferral Next week we 11 continue with more items for yearend tax plan or a free long term i panson between an equity mutual fund and an Itltsp investment earning per cental t Peter Masson 10 Drive Georgetown On or phone 716 Paul J is the author of the best seller Why I Invest in Mutual and President Regal Capital Planners Limited a 4 yearold financial planning company with offices from toast to coast in Canada HAS SNOW Be Prepared DOMINION GARDENS 7 MAPLE AVE Guslph St J GEORGETOWN WREATHS 099 8 FOR ALL YOUR WINTER TIRE NEEDS SEE TONYS SUNOCO AND AVE SUNOCO get a better run for your Money Safari L OUTDOOR POWER EQUIPMENT Goorgatown District High School 8770314 SLUSH ON PANTS NO PROBLEM We Can Take Care of it Mi LET IT SNOW STORM PERFORMER SCRAPER SNOWBRUSH WINDSHIELD WASHER ANTIFREEZE Litre GASOLINE ANTI FREEZE TIL GEORGETOWN LOCATION ONLY SPORTS HARDWARE PARTS GEORGETOWN 8775140 8775119 877