Canada BS Thread

Income splitting is projected to cost the Feds $2B / year , even Jim Fahetry , the late former finance minister did not support it

 

Income splitting hasn't been introduced yet , the monetary deficit is because of oil prices . The increasing of the TFSA is only an advantage to higher income Canadians , same as income splitting , but both of which are being touted as breaks for the middle class

 

Upping the TFSA limit is projected to cost the feds $1.1B over the next 5 years

 

Yes

 

100% agree.
Neither will benifit the class that actually needs it.

 

Income splitting is in effect for this year, to a maximum return of two thousand dollars. So a couple that has a combine income of 200 grand can only claim 2 grand a year. Sounds like a benefit for the middle class to me.

 

https://www.broadbentinstitute.ca/en/blog/costly-and-unfair-stephen-harpers-income-splitting-scheme

 

TFSA doesn't really help a person who makes over 125 a year, unless you are able to max out your RRSP's. Rate of return on a person who lives in Alberta and is in the top tax bracket for 2014 which is $139,000 and above, is 39%. Then when you are old or retired and you pull that money out it is taxed at around 25%. Seems like a much better return than anything that you can do with a TFSA, plus there is a little growth in the RRSP as well.

 

You can invest funds that are in a TFSA

 

Yeah, my wife and I were able to use it to get about $500 off of my taxes and we make no where near $200K together. A lot of people here support income splitting because women make a lot less in the workplace on average around here. Simply because in this area there are a lot of mormons and dutch reformists who believe the woman should try and stay home to take care of the kids. For those families income splitting makes sense.

That being said I'm sure there are better ways to give the middle class a tax break rather than income splitting. I would rather see a small percentage drop to the lowest tax bracket or another tax break to families.

 

Yeah you can designate anything into a TFSA. My accountant is trying to get me to set one up but I have to figure out how to best make it work in my advantage first. After all, that's what I pay her a premium on doing my taxes for.

 

I agree with your assesment is the case you described that an RRSP would be a better choice , however ,does a person making over $125K a year , that has already maxed out their RRSP contribution limit of approx $25K for the year really need an increase in the TFSA ? Probably not , but a person making that kind of money likey is the only person having that kind of extra cash kicking around to max out the TFSA contribution as well , so like I said , the TFSA increase only benefits top earners

 

https://www.broadbentinstitute.ca/en...litting-scheme

good article, I've read it before. I am one of those very rare family groups in which they speak of. Two little kids, Wifey doesn't work and I work for the devil(big oil). We did the income splitting for this year and received the max return, $2000.

I have friends who work for the government who only make $60 a year, single earner for the family. They also did income splitting, and received $1000 out of the deal. He was complaining about it to me the other day that he should receive more and I should get less. I told him that I didn't really agree with him as I had to pay 75 grand in taxes last year. When you do the math, he got a better deal than I did.

Is Harper buying votes? I think so.

 

Don't read the article I linked

 

This tfsa stuff is making me cringe. Some people need to learn about it more

 

I just think it doesn't benefit a broad enough spectrum of Canadians , edpecially lower income , or single parents , to justify the $2B it costs annually

and I agree Harper is buying votes with it .

 

Tfsa is one of, if not the best way to make money. Jesus it's the only way you can make tax free money legally

 

True the TSFA only helps out the top earners or those who work at a place that still offer a pension, like government employees.

I don't even have a TSFA set up. Paying off the house is the top priority

 

Sometimes an RRSP contribution is a better choice or aggressively paying down a mortgage etc

 

To someone who has no investing knowledge a mortgage. But an RRSP has zero advantage over it IMO. All you do is save tax initially. If you really want a good rrsp I think it's better to use your tfsa and the. Dump it into the rrsp after you make substantial gains