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Sales resources > Investments > Tax and Retirement Services

Tax Strategies

Paying too much tax hurts.

As an advisor, an important part of your value proposition is to identify strategies that will help your clients’ minimize the amount of tax they pay.

That’s where we can help.

The Tax & Retirement Services (TRS) team identifies tax challenges that your clients may face and provides easy-to-understand solutions, which you and your clients can understand.

Tax Managed Investing Strategies are ideas that you can introduce to your clients in one-on-one meetings, seminars, websites, and newsletters.

The following provides a selection of available topics from which you can choose.

Tax Managed Investing – Strategy #1
Capitalizing on Capital Losses
If you or your spouse have realized capital gains in the last three years, consider selling an investment that has dropped in value to recover the taxes paid on those gains

Tax Managed Investing – Strategy #2
Fighting the Clawbacks –Reduce Line 234
Clawback Calculator
Dividend income is the least “income friendly” to retirees because the grossed-up amount is reported on their tax return. Although the dividend tax credit provides preferential tax treatment, the grossed-up amount exaggerates the total income on line 234.

Tax Managed Investing – Strategy #3
Maximizing Discretionary RRIF Income by Borrowing To Invest 
If you are an investor with discretionary RRIF income, you can put that income to good use. By borrowing to invest, you not only achieve tax savings each year, but gain the potential to significantly increase the value of your non-registered investment portfolio over the long term.

Tax Managed Investing – Strategy #4
Final RRSP Contributions at Age 71
The clawback of government benefits can have a significant impact on an individual’s retirement income. Some careful RRSP planning as age 71 approaches, however, can reduce taxable earnings in retirement – and reduce the clawback of government benefits.

Client Insight video with John Natale and Dan Richards – Using an Over Contribution Strategy
Client Insight video with John Natale and Dan Richards
– Making a Final RRSP Contribution at age 71

Tax Managed Investing – Strategy #5
Unlocking Locked-In Funds 
While pension assets represent an important source of retirement income, locking-in restrictions can hamper retirement income planning flexibility. By making full use of maximum withdrawal limits, thousands of dollars of pension savings can be unlocked while remaining tax-sheltered.

Tax Managed Investing – Strategy #6
Lower the Family Tax Bill – Income Splitting Using Loans 
Demand Promissory Note 
People often consider tax saving strategies on an individual basis, but overlook family strategies that can save significant tax dollars. The use of intra-family loans to split income and save taxes is a good example.

Tax Managed Investing – Strategy #7
Cross-Border Investment Planning 
There are significant investment tax-saving opportunities for Canadians who take up residence in the United States. In order to benefit, it’s important for individuals to properly structure their investment portfolios before they leave.

Tax Managed Investing – Strategy #8
Little Known Facts About the Canada/Quebec Pension Plan (CPP/QPP) 
For Canadians at or nearing retirement, the Canada/Quebec Pension Plan (CPP/QPP) remains a bit of a mystery. Many people realize they’ve been contributing to it for a good portion of their lives, but may not be sure how much they will receive at retirement.

Tax Managed Investing – Strategy #9
RESPS no longer just for kids 
When most people think of Registered Education Savings Plans (RESPs), they think of an educational savings plan for children. Did you know that RESPs are a great savings plan for adults too?

Tax Managed Investing – Strategy #10
Giving more for less – maximize donations to charities 
Not only do charitable donations provide individuals with the satisfaction of giving back to their communities, Canadian tax laws ensure that there has never been a more tax-advantaged time to give.

Tax Managed Investing – Strategy #11
Put your retained earnings to work 
Many business owners have built up significant retained earnings in their corporation and are looking for ways to pull that money out. Well, there’s a simple strategy available that moves retained earnings out of the company and puts them to work generating investment returns – in a tax efficient way.

Tax Managed Investing – Strategy #12
Individual Pension Plans - and the family business 
Because of increases to pension limits and the ability to include an Individual Pension Plan (IPP) in a succession plan, IPPs have become the RRSP alternative for many business owners.
IPPs at a glance

Tax Managed Investing – Strategy #13
Alter Ego Trusts: the answer to probate fees? 
Alter ego and joint partner trusts have been gaining in popularity as a way to avoid probate, but are there alternatives? This strategy looks at alternatives to Alter Ego trusts and the advantages of and disadvantages to both.

View the Quebec Edition, ALTER EGO TRUSTS: an answer to enhance creditor protection

Tax Managed Investing – Strategy #14
The Pension Income Tax Credit using an Insurance Company GIC
If you or your spouse are 65 or older and do not have income from a RRIF or private pension plan there is another alternative to take advantage of, the pension income tax credit.

Tax Managed Investing – Strategy #15
Opportunities For Pension Income Splitting
If you have a spouse (or common law partner) who is in a lower tax bracket, you and your spouse will be able to elect to have up to 50 per cent of eligible income transferred to the lower income spouse. Eligible income is defined as income eligible for the pension income tax credit.

Client Insight video with John Natale and Dan Richards

Tax Managed Investing – Strategy #16
Tax planning in a volatile market
Stock market volatility may cause investors to worry about their investments and to make matters worse, the taxable amounts reported at year end may not relate to the value of their portfolio.

Tax Managed Investing – Strategy #17
Making the most of your TFSA dollars
Now that we have a new savings vehicle, Tax-Free Savings Accounts (TFSAs), it’s time to consider who can best benefit from using them as well as why and how you could use them.

View our client-friendly video on Tax Free Savings Accounts (TFSAs).

Tax Managed Investing – Strategy #18
RESP Savings Strategies – Lump Sum or Periodic?
It’s no secret that the cost of post-secondary education in Canada is on the rise. And for that reason, you may be wondering about the best savings strategy when it comes to contributing to a Registered Education Savings Plan (RESP) for a child.

Tax Managed Investing - Strategy #19
Making the most of your maturity guarantee
Many individuals have segregated fund contracts that are approaching their maturity date. If the market value has declined you may be entitled to a maturity top-up. What are the implications of this and what can be done to minimize the taxes?

Tax Managed Investing – Strategy #20
Using Series T for income now and charitable donations later
Many Canadians may be looking for ways to increase the tax efficiency of their retirement investments. Additionally, they may want to give back while taking advantage of the tax benefits of donating investment funds to charity. Did you know that there is an investment option that can allow you to combine both of these objectives? An investment in a Series T fund can provide tax-efficient income now and a tax effective way to donate in the future.

Tax Managed Investing – Strategy #21
Ideal Candidates for Mutual Fund Corporations
A Mutual Fund Corporation is a single taxable entity consisting of several classes of shares, with each class representing a different mutual fund.  This allows Mutual Fund Corporations to offer several tax benefits to those investors with non-registered funds.
Consider using a Mutual Fund Corporation structure to both help reduce taxes and find corporate funds that appropriately fit investment objectives and risk tolerance.

Tax Managed Investing - Strategy #22
Leveraging
If you are an investor who makes regular contributions to your non-registered investment accounts, there is a strategy available that may allow you to increase your net worth over the long term and make your regular contributions tax deductible.

Tax Managed Investing - Strategy #23
Spousal RRSPs
Now that we have pension income splitting, are spousal* RRSPs a thing of the past?
At first glance, it would appear that spousal Registered Retirement Savings Plans (RRSPs) are no longer needed because the pension income splitting rules allow couples to split their income once their RRSPs become Registered Retirement Income Funds (RRIFs). Nevertheless, there are situations in which spousal RRSPs can offer some advantages.
* The terms spouse and spousal includes a spouse or common-law partner as defined by the Income Tax Act (Canada).

Tax Managed Investing - Strategy #24
The bigger bang RRSP strategy
For many Canadians, as the calendar year winds down, the time comes to think about making your annual contribution to your Registered Retirement Savings Plan (“RRSP”). Whether you contribute regularly to your RRSP throughout the year, or if you make a single lump-sum payment or additional “top-up” payment closer to the RRSP deadline, there is a strategy you need to consider.
Bigger Bang RRSP Strategy PPT TMS#24

Tax Managed Investing - Strategy #25
Corporate In-Kind Donating
As more and more corporations invest their retained earnings directly in various investment vehicles such as mutual funds and publicly traded securities, the value of their portfolio continues to grow. And as business owners build their corporation’s portfolio, they may also want to give back while taking advantage of the tax benefits of donating investment funds to charity. However, what many business owners may not know is that where corporate investments have increased in value, a corporate donation in-kind results in a more favourable tax consequence than selling the investment and donating the cash.
Case study – Corporate Class Mutual Funds: Corporate Donation (login required)

Tax Managed Investing – Strategy #26
Using corporate money to fund your retirement
Many individuals have built up significant cash or liquid assets within their corporation but the tax cost of withdrawing those funds is often prohibitive, resulting in the corporation itself looking to purchase the investments directly.

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