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LI SO Nes ant beer NY (VAS NRT YA NLS PORT PERRY STAR - Tuesday, January 26, 1093-17 Strategies for your RRSP There are two major obsta- cles to building substantial per- sonal wealth in your RRSP. The first is the failure to contribute the maximum allowable amount on a regular basis. Reg- ular contributions are vital to taking full advantage of your RRSP's potential. The second mistake is to forget about the money once itis in the plan. Too many people think all there is to an RRSP is making a contribu- tion and claiming a tax deduc- tion. In reality, that's only the beginning. And that's where strategies for managing your RRSP comein. Everyone knows you can save taxes by contributing to an RRSP. But there are many oth- er ways a Registered Retire- ment Savings Plan can be used to save precious tax dollars. The ideas range from the use of spousal RRSPs, to the manage- ment of investments on a "port- folio" basis. This involves view- ing your RRSP as a part of a larger whole - your entire sav- ings and investment plan. Electronic tax filing From Page 16 who receive refunds each year, the program offers some real advantages. Based on past ex- perience, taxpayers who Efile should have their returns as- sessed and refunds issued much more quickly than for paper re- turns. And those taxpayers who opt for direct deposit may get their money even sooner. The BDO Dunwoody Ward Mallette Uxbridge office is one accounting firm which plans to use Efiling for clients that agree to it. "We think the Efile pro- gram is at for taxpayers," says Tom Hill of BDO. "Refunds will be received much faster, and there should be a lot fewer follow-up requests from Reve- nue for additional information or missing slips and receipts." Of course, Revenue Canada still reserves the right to check your return at a later date and request additional information, so you have to ensure that ei- ther you or your preparer keeps all the backup for the return. But this isn't any different than under the current system where you file paper returns. Not everyone can Efile though. For instance, non- residents with certain Canadi- an-source income must contin- ue to file the paper returns, as well as taxpayers who carry on business in more than one juris- diction. However, the excep- tions are so few that approxi- mately 95 per cent of all personal tax returns should be eligible for the program this year. Revenue Canada expects over a million and a half 1992 tax returns will be Efiled by the end of April 1993. Efiling of tax returns is the way of the future. If you're in- terested in participating, get in touch with a tax preparation or accounting firm who offers this service to their clients. courtesyof Tom Hill, Tax Manager, BDO Dunwoody Ward Mallette, Uxbridge Making The Most Of Spousal Plans Spousal RRSPs are a classic example of long-range tax plan- ning. They can be an important way to splitincome, and thus re- duce overall taxes, when you re- tire. The money you contribute to a spousal RRSP must be con- sidered within your normal con- tribution limits, so you get the same immediate tax break as if you had contributed to your own plan. In most cases, the special advantage comes later. After you've retired, if your spouse would have received substantially less income than you without income from the spousal RRSP, your foresight will have saved the two of you many tax dollars. You could be headed for tax-trouble if you in- tend to withdraw money from a spousal RRSP soon after con- tributing. If your spouse col- lapses an RRSP to which you've contributed within the preced- ing three years, the contribu- tions you've deducted will be at- tributed back to you and added to your taxable income. This is known as the "three-year-rule." There are, however, ways around it. These can include making your contributions to your plan and not the spousal plan for the three preceding years before you intend to col- in Your Future" from the present this coupon to CIBC, 145 Queen St., Port Perry, Ontario The guidebook will be available while quantities last. Strategies for Success series, lapse the spousal plan. Also, any sum received by your spouse through an annuity or RRIF is not subject to the three- year-rule as long as it doesn't exceed the minimum amount as defined in the Income Tax Act. Taking A Total Portfolio Approach Your RRSPis certainly anim- portant part of your total sav- ings and investment program, but it's only one part. If you want to obtain the maximum tax advantage, never view your RRSP in isolation. The first step is to understand the difference tax treatment given to various types of investment income. When you review your total in- vestment portfolio, see if you're taking full advantage of the dif- ferent tax treatments. For ex- ample, if you're holding GICs outside your RRSP and equity mutual funds inside your plan, you're probably paying more taxes than necessary. It's a good idea to review the performance and structure of your total investment portfolio, including your RRSPs, at least once a year to see how well you're doing. courtesy of Janet Loan, Personal Banking Manager, CIBC, Port Perry ~ REET [To RTT U1 Pl | To (STI (=TF 0] ETT TT Te] How much money will you need for a satisfying retirement? How can you be certain you will have enough? What steps should you be taking now to guarantee your retirement income? For your free copy of CIBC's guidebook "Investing BS I I I | | | | ! = "Personal, ROGER B. MOASE Chartered Accountant 238 Queen Street Port Perry, Ontario LOL 1B9 Bus: 985-8893 Fax: 985-4944 { Res: 985-7225 TAX RETURN PREPARATION Confidential, Service" SRE DUNWOODY WARD MALLETTE Chartered Accountants Financial Planning RRSP Advice Tax Preparation Payroll services including T4's, T5's, WCB, EHT Accounting for small businesses New business planning & start up GST If we can be of assistance please drop by our office or give us a call. 38 Toronto St. N. Uxbridge Reaching your RRSP limit is easier than you think. If you think it is impossible to contribute to your maximum, you may be surprised how easy one of CIBC's payment options can make it. Come in and see us. Our experts can help you choose the RRSP that's right for you. Secure Your Future with a CIBC RRSP To book your RRSP Review Interview call 985-4444 (el us working for you! 145 Queen St., Port Perry » 985-4444