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PORT PERRY STAR - Tuesday, February 20, 1996 -13 RSP provides for Income splitting when you retire Last week we looked into the advantage of us- ing RRSPs as a means of income averaging for an individual. This week let us look at the possibilities of using them as a means of income splitting now and when you both retire. If one spouse is earning a high income and possi- bly has a pension plan at work that will insure some pension income when they retire, but the other spouse will receive mini- mal retirement income, the high earner should consider contributing to a 'Spousal Plan.' This pro- duces a tax break at the higher rate of the contrib- uting spouse and then (af- ter three years of non- contributing to any spou- sal plan), it becomes the income of the lower in- come spouse. With the change in the tax law governing the 'age amount,' it is even more important to try and split the income more evenly ACCOUNTING SERVICES 180 Mary St., Port Perry Ontario LIL 1C4 (905) 9850712 Toll Free 1°800°699°6190 Fax (905) 985-9461 Email address: Penny@dis.on.ca | PENNY ASSOC. by spouse 'B', the higher income spouse 'A' would have to pay $11,358 in tax. However if that $50,000 were split evenly between the two, they would each pay $3,849.50 (assuming that part of the income was made up of a RRSP annuity or RRIF) making a total of $7,699, a $3,659 saving. You do not need to wait until 65 to realize the sav- ings from spousal RRSPs. Provided three years elapse since your last spousal contribution, the lower income spouse can withdraw the money at their lower tax rate and you are free to once again investin a spousal plan. In this way you can reap the benefit of high tax rate de- ductions only to be taxed at alow rate as spousal in- .come every fourth year. This does however negate the added advantage of sheltered interest whilst in a RRSP which is the main factor in its rapid between spouses. For ex- growth of funds. ample, if a couple over 65 years of age were bringing Courtesy of, "in $50,000, but only the H&R Block, 0.A.S. was being received Port Perry IAS - New Business Set Up - Training on accounting systems - Part time controllership - Management consulting Bookkeeping services Personal 8 business tax returns E-FILE available Free copy of Tax Tips & Traps 1 Weekend & Evening --p appointments smn Van Camp & Keller Chartered Accountants There Are A Lot Of Ads For RSPs Out There. Here's Why This One Is Different. In a nutshell, ar Laurentian Bank we make it easy. fl We help you plan your retirement strategy with our free, personalized projections, so you know exactly how much to invest yearly to reach your goals. B We feature a wide selection of more that 35 well-established mutual funds to help you diversify your assets, and we identify your investor profile so you invest in only the most suitable funds. B We offer you our Tactical RSP*, which conveniently groups all of your Laurentian Bank RSP investments, including savings bonds and mutual funds, into one easily-administered portfolio on one clear statement. As you can see, we're the bank that makes your retirement planning both profitable and easy. *Trademark of Laurentian Bank of Canada For more information, just contact your branch RSP representative. 165 Queen Street 985-8435 20 LAURENTIAN BANK 0 OY) 1.10 J. We make it easy. J. PETER HVIDSTEN/ PORT PERRY STAR IN APPRECIATION - Cody Forsyth, left, and Caitlin Daly accepted a plaque from Durham M.P. Alex Shepherd:during Flag Day ceremonies held at R. H. Cornish Public School last Thursday morning. More than 700 students and teachers took part in a brief ceremony in front of the school in celebration of the 31st birthday of the Canadian Flag, which was first raised on February 15, 1975. Township discloses - councillors expenses Remunerations have been finalized for Scugog Township Council for 1995, although all councillors expressed concern over what they felt were discrep- ancies in their reimbursment costs. The totals show Mayor Howard Hall receiving $19,000 in remuneration, with additional money for mileage, meeting and conference expenses, bringing his total to $22,871.64. Next on the list was Ward 3 Councillor Ken Gadsden at $13,464.30 and Regional Councillor Marilyn Pearce receiving $13,340.92. Ward 5 Councillor Karen Puck-rin received $12,575 while Ward 1 Councillor Doug Moffatt and Ward 4 Councillor Joyce Kelly received $12,500. All councillors" remuneration is $12,500 be-fore expenses, while the mayor receives $19,000. Ward 2 Councillor Ken Carruthers receiv-ed a remuneration of $7,291.69 and a total of $7,896.49. Councillor Carruthers only served half a term last year, after being elected to council in a by-election. Former Regional Councillor Yvonne Christie remu- neration totalled $2,083.34 for her time served before her passing in January of last year. Income tax planning and return preparation. Personal tax returns electronically filed. Financial, estate and retirement planning. OFFICE HOURS Personal Tax Returns are being processed now. UNTIL APRIL 30. Monday to Friday 8 - 6, Saturday 9 - 1 204 Casimir St., Port Perry Telephone: (905) 985-9725 Toll Free: 1-800-215-3852 81/2 x 11" - 20 Ib. White Bond Paper - Black Ink Only Single Side, machine fed original (sorry, no exceptions) 19.99 phus taxes We Accept: Visa Mastercard Interac 188 Mary Street - Port Perry - Call (905) 985-7383 Fax (905) 985-3708 Expiry Date: February 29, 1996 This coupon must be presented for special price