Every spring, millions of Canadians file their tax returns, an important once-a-year accounting of taxes owing or refunds due for your previous year.

In Tax Planning for You and Your Family, KPMG’s tax professionals take you through some tried and true tax planning opportunities that may be available to individuals.

Financial planning can be both daunting and mystifying for many people — but it shouldn’t be. Whether you’re going to school or work, starting a family, running your own business, or getting ready to consider your retirement options, Tax Planning for You and Your Family can help you set your objectives and marshal your financial resources to support your plan.

Let’s have a look at what you can expect to find in Tax Planning for You and Your Family.

What’s new in the 2023 Edition

This year’s book provides up-to-date information on recent tax rules that may significantly affect individuals, including private company owners and their families.

In addition to updated federal and provincial tax rates and tax credit amounts, this year’s book also offers new information on:

  • Changes to the small business deduction to make it accessible for more businesses
  • A new tax deduction to help tradespeople with expenses for travel and temporary relocation
  • The latest changes to help Canadians purchase their first home, including the new tax-free First Home Savings Account and an increase to the First-Time Home Buyers’ Tax Credit
  • New tax relief that may apply when transferring your family business to the next generation
  • Tax incentives for home renovations, including the increased Home Accessibility tax credit and the new Multigenerational Home Renovation Tax Credit
  • New punitive rule to tax the “flipping” of residential property
  • Recent changes to restrict the amount of stock options that may benefit from preferential tax treatment
  • Eligible home office expenses including certain expenses incurred because of the need to work from home due to the pandemic
  • Your tax obligations on taxable subsidies or benefits received from the government as part of its COVID-19 emergency measures
  • The latest HST and provincial sales tax rates in effect across Canada

This year’s edition is available in both print and eBook formats.
Read the first chapter – download using the link below.

A primer on financial planning

The book begins with an examination of how taxes can affect your ability to meet your family’s financial goals. Tax planning to manage your family’s overall tax obligations should be an integral part of your family’s financial plan.

Opportunities to strengthen your financial discipline include changing your expectations, paring down your current lifestyle or simply prioritizing expenses may present themselves. But having a sound financial plan will ease your financial anxiety by giving you a realistic picture of your family’s finances and providing a clear path to achieve your goals.

Perhaps your plans include a vacation home, major renovations, a luxury car, or a swimming pool. Maybe you’ve always wanted to take a sabbatical from work to start your own business. Whatever your goals, planning them out with your spouse, partner, or family is the first step towards making them a reality.

Tax Planning for You and Your Family describes how your tax bill is calculated and highlights some commonly available and sometimes overlooked deductions and credits that you might be eligible to claim.

Ways to lower your tax burden

Tax Planning for You and Your Family covers options that may be available to you regarding your effective tax rate and looks at some of the planning opportunities.

The book considers income splitting—a strategy to save taxes by shifting income from the hands of a family member in a higher tax bracket to the hands of a second family member in a lower tax bracket so that the same income is taxed at a lower rate of tax. While tax rules prevent many forms of income splitting, we highlight income splitting opportunities that may be available to you.

Capital gains and losses are also covered. Given special treatment in the federal income tax system, capital gains are effectively taxed at a lower rate than regular income, and individuals are entitled to an exemption for capital gains on certain kinds of property.

Taxing your investments

We look at how investment income is taxed, how interest expense can be written off, and a few types of tax shelters, along with a number of tax planning ideas that you should keep in mind. We also discuss special tax rules that apply to foreign investments as well as the alternative minimum tax, which may apply depending on the nature of your investments.

Factoring in luxury tax

Tax Planning for You and Your Family looks at the new luxury tax that came into effect as of September 1, 2022. If your financial planning includes buying luxury goods, such as high-end vehicles, boats, or aircraft, you may be subject to this new tax.

Advice for your employment situation

Whether you are employed by someone else or work for yourself, we examine some of the ins and outs of taxes related to employment.

Though, generally speaking, you cannot claim deductions against employment income, there are a number of special rules that may apply to your employment income, and these are covered in Tax Planning for You and Your Family, as are special rules that apply to professionals.

We also highlight some of the major topics in the taxation of business income as well as tax planning strategies that may be available if you are an owner/manager of your own corporation.

Cross-border tax planning

Tax Planning for You and Your Family discusses United States taxes that apply to Canadian residents who are not U.S. citizens but who work in the United States or acquire U.S. investments such as stocks and real estate.

This content will be of particular interest to those “snowbirds” who spend part of the year in the United States. We cover, for example, rules that can make you resident in the U.S. for tax purposes. Receiving CPP/ QPP or OAS benefits in the United States, as well as differences in your health care coverage, government- assisted investment vehicles and how your assets will be taxed at death are likewise examined.

Also addressed are financial planning issues to consider for both snowbirds and non-snowbirds alike as you plan your retirement, and why its worthwhile developing your retirement and estate planning strategies at the same time.

Estate planning and taxes

Estate planning can be extremely complicated and depends very much on your personal situation and goals. This planning should be undertaken in conjunction with the development of your retirement plan, and professional advice is highly recommended. Careful estate planning can help you manage taxes arising on death and leave as much as possible to your beneficiaries.

Tax Facts

Need more information on personal and corporate tax rates? Download KPMG's publication Tax Facts, and get quick access to the most relevant and up-to-date tax figures and evolving tax trends.