Are you a self-employed or unincorporated professional? You can implement a strategy that will prevent you from paying non-deductible interest on your income.
You must be in business without being incorporated and have professional expenses, such as a secretary’s salary, business rent, long distance, travel or entertainment expenses, capital expenses, or the like.
- On the other hand, you must have personal debt, a mortgage on a home or cottage, a car loan, a personal line of credit, etc. Setting aside money involves using the income from your work to pay off your personal debts, the interest of which is not deductible.
- Suppose you have a mortgage loan of $ 200,000 on your primary residence. You open an account at the bank in which you deposit all your income. With a line of credit, you pay exclusively for your business expenses. When the bank account reaches the amount of the debt, you pay it off. Then you borrow to pay off your line of credit. Result: Your debt is $ 200,000, but the interest is now deductible.
More measures to help families and seniors
Canadian baby boomers are in their hundreds of thousands each year in their sixties. What give nightmares to governments who want at all costs to prevent these people from one day queuing at the doors of hospitals?No wonder several tax measures introduced in 2012 and already announced for 2013 promote home support for the elderly.
Before we begin, let us specify that Ottawa and Quebec have indexed their tax table, respectively by 2.8% and 2.66%. Since January 1, 2013 in Quebec, a fourth level has been added to the income tax table for individuals with taxable income over $ 100,000. The rate for this new level is 25.75%, which brings the highest marginal tax rate for a resident of Quebec to 49.97%, instead of 48.2%. The use of the tax refund calculator comes handy for the proper calculation now.
Caregiver
In order to grant respite to people caring for an elderly spouse unable to live alone, the refundable tax credit for caregivers was increased to $ 700 in 2012 ($ 591 in 2011).
Extend autonomy
In 2012, Quebec introduced a refundable tax credit for the purchase or rental of certain goods aimed at extending the autonomy of seniors and their home support. This credit is equal to 20% of the part in excess of $ 500 of all amounts paid for the purchase, rental and installation of goods used in the home. Such as a GPS, a remote monitoring device, a walk-in bathtub, a chair mounted on a rail to use a staircase, etc.
Return to autonomy
A refundable tax credit of 20% of the costs of a stay of up to 60 days incurred for a stay in a transitional functional recovery unit (rehabilitation service) is offered to individuals aged 70 and over. The taxpayer can have more than one qualifying stay in the year.