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8 in si d eh al to n .c o m O ak vi lle B ea ve r | T h u rs d ay , A pr il 1 9 ,2 0 1 8 | Advertorial Managing your money: Avoid the clawback Seniors receive a variety of benefits and tax credits from the federal government that are not available to others, however some benefits are income-tested and can result in clawbacks. Old Age Security (OAS) payments and the Age Credit are two ex­ amples of benefits, which can be clawed back without proper income planning. OAS is a monthly benefit available to most Canadians age 65 or older. You will be required to repay 15 per cent of the amount by which your net income for 2017 - inclusive of your OAS benefit - ex­ ceeds $74,788. When your net income ex­ ceeds $121,071, your entire OAS benefit is clawed back. July 2017 to June 2018 payments are based on 2016 net income, while July 2018 to June 2019 payments will be based on 2017 net income. helen mara sales representative 905 845 4267 ^^^miiiiiiiiiiiiiiiiiiii ROYAL LePAGE ^^^Hlllllllllllllllllllll West Harbour Gem!!! Situated on one of the largest lots in the W est Harbour area - 6 0 ' x 160' - and beautifully updated inside and out, this 4 50 0 square foot home is steps to the lake and harbour. Finished on three levels with a w alk up and out from the lowest level to the stunning perennial filled garden this home is m ade for entertaining! Four bedrooms (M aster is an inviting retreat with its gas fireplace, vaulted ceiling, garden lookout and spa like ensuite), 2 more fireplaces, magnificent custom kitchen with walkout to elegant party sized patio with conversation area and gas fireplace table. - ; i m w Age Credit is a non-refundable tax credit available to Canadians age 65 or older at the end of the year. For 2017, the maxi­ mum amount you can claim for the Age Credit is $7,225. This amount is reduced by 15 per cent of your net income in excess of $36,430 and is reduced to $0 when your taxable income reaches $84,597. The value of the credit is calculated using the lowest federal tax rate of 15 per cent multiplied by the amount claimed. You can avoid OAS and Age Credit claw­ backs by keeping your net income to the absolute minimum required to meet your needs. Here are some strategies for doing just that: • With pension income splitting, you can allocate up to 50 per cent of "eligible pen­ sion income" - including payments from your Registered Pension Plan (RPP) (at any age) and Registered Retirement Income Fund (RRIF) (at/after age 65) to your lower earning spouse, which usually reduces your family's overall tax bill and clawbacks. • Reduce the amount of income received as Canadian source dividends, since these amounts are "grossed up" for the purposes of determining net income (al­ though there is a dividend tax credit which will reduce the amount of tax paid, it does not reduce the amount of net income). • Withdraw the minimum from your RRIF. Withdrawals from investments held within a RRIF are fully taxable, so consider with­ drawing only the minimum each year. If you have a younger spouse, base your withdrawals on their age - this will pro­ duce a smaller minimum withdrawal. • Invest in TFSAs. Investments held with­ in Tax-Free Savings Accounts (TFSA) gener­ ate tax-free investment income. TfSa with­ drawals are not taxable, so do not result in clawbacks. • Seek non-registered investments that offer preferential tax treatment. Only 50 per cent of realized capital gains are in­ cluded in income, and equity investments often distribute less investment income than fixed income investments. Less net income results in less of your income-test­ ed benefits being subject to clawbacks. You can avoid clawbacks, reduce your tax burden and preserve your wealth. But don't run afoul of complex tax rules by us­ ing inappropriate strategies for you situa­ tion. Talk to your professional advisor first. Article provided by Investors Group Fi­ nancial Services Inc. TOP 1% IN CANADA FORROYAL LEPAGE SHEILA BARRY & LINDA ZYLIK SALES REPRESENTATiVE BROKER u. lerage REALTY PLUSIUI OWlif. BROKEFAGE IHDEFENDEHTiyOWNED AND OPEFATED CALL OR EMAIL TODAY905.467.4745 LINDA@ SHEILAANDLINDA.COM • TO VIEW ALL LISTINGS AND VIDEOS GO TO SHEILAANDLINDA.COM OPEN HOUSE SAT & SUN 2-4PM 234 ALISON CRESCENT SOUTH OF LAKESHORE RD SOUTH EAST OAKVILLE LAKESHORE W O O D S - $1,448,000 NEW LISTING - $1,425,000 ALTON VILLAGE - $1,389,000 D E S IR A B L E S W O A K V I L L E P O C K E T COMING SOONTO MLS 4+1 B E D R O O M S , 4.5 B A T H R O O M S O N SU PER B FANTASTIC 4BEDROOMS, 2.5 BATHROOMS FAMILY SPECTACULAR CUSTOM BUILT HOME. 4+1 BEDROOMS 95'X150' LO T . 3000 SF + F IN . B S M T 20 'X40 ' L O C A T IO N IN L A K E S H O R E W O O D S . Fu l l y H o m e . GREAT FLOOR PLAN. CLOSE TO LAkE, 4BATHROOMS OF LUXURIOUS UPGRADES. P O O L . R E N O v A T E D IN T E R IO R . F IN IS H E D L O W E R LE Y E L . PARkS AND TRAILS. PROFESSIONALLY FINISHED LOWER LEYEL.