The Bottom Line on Tax Savings - Fall 2005

Knowing what to look for and getting organized will make tax time a lot easier come winter. Fall is a good time to get your receipts together in preparation for filing your income tax return. Here are some line specific tax saving ideas for your 2005 income tax return:

Line 120 Dividends from Canadian Corporation
If it is to your advantage, be sure to use income splitting opportunities with your partner and children. By transferring income from a high bracket earner to a low bracket earner, you reduce the amount of taxes your family will pay and help maximize your potential returns.

Another good idea is to take money from child tax benefit payments and invest it under your children's names.

Line 214 Child Care Expenses
Hang onto your receipts from after school and lunch programs because they qualify as day care expenses. Some children's camps and sport camps also qualify as a day care expense.

Line 219 Moving Expenses
A move can be a huge expense. If you have moved to start a job or a business (at least 40 kilometres), you may be able to claim expenses related to real estate and legal fees from the sale and purchase of your home. You're also allowed to carry forward your moving expenses for one year. If any member of your family is a student having to relocate for schooling, they are also allowed to claim moving expenses.

Line 326 Amounts Transferred from your Spouse
Many deductions on your income tax return can be transferred from you to your spouse. If you are unable to use your age, pension, disability or education amounts, you can transfer them to your spouse.

Line 330 Medical Expenses
Medical expenses can add up quickly. By combining the family medical expenses onto one tax return, you can receive more of a tax benefit. Medical expenses can be claimed for any 12-month period, so review your expenses and decide which 12-month period is most advantageous for you.

Be sure to claim your health and dental benefits premiums from work, travel health, Blue Cross and other health plans. Insurance and disability premiums do not qualify.

Line 349 Charitable Donations
Some people find by not claiming their charitable donations every year they receive more of a credit. The amount of credit given for charitable donations increases once your total donations are over $200. You can also combine your donations with your spouse's donations to maximize your tax credit.

Your Rice Financial representative can help determine which deductions will help you the most. Make an appointment this fall to ensure you're prepared for the upcoming tax season.