There are many ways to reduce your income tax (IT) liabilities to a substantial amount and the most significant ones are discussed below in brief. While they may appear like rocket science to the uninitiated, but once decrypted and appropriately applied with the help on an able financial professional, can really go to great lengths and do wonders to save your hard-earned money.
Try to take a loan in the name of your spouse
If your husband or wife, whatever may be applicable, belongs to the lower IT bracket, then applying for a spousal is a great income splitting strategy. The entire loan proceeds can be invested in high interest yielding investments, or a business, real estate, stocks, etc. and any income obtained from such investments would be reflected in your wife’s returns instead of yours and would be taxed accordingly.
Expenses towards childcare include though not limited to daycare costs, nanny or babysitter service charges, PLASP fees, after-school program expenses, etc. They would be deducted from the income of the spouse who belongs to the lower IT bracket, even if all the associated costs are provided by the one pertaining to the higher income slab.
You can reduce your taxes to a great extent by deducting the amount charged by your accountant. The accounting fees that you will be paying can be deducted from rent receivables, investment income, or business income as reported on your personal tax return. An experienced Income Tax Accountant in Surrey will be able to provide ample guidance on this issue.
If you are a sales executive, then you can ask for deducting any valid expenditure that you incurred to earn your commissions. A competent Income Tax Accountant in Surrey can help you to fill the T2200 form and provide you with valuable consultation.
Public Transit Charges
You can ask for a tax credit for amounts spent to purchase yearly or monthly public transit passes and the following ones are eligible to submit a claim.
You can consider opening a Tax Free Savings Account (TFSA) to minimize your income tax dues. Any amount that you are to invest in such accounts will not be subjected to any tax. In sharp contrast to an RRSP, TFSA withdrawals are also not taxable. You can keep bonds, stocks, high interest yielding savings accounts, and mutual funds inside a TFSA.