July/August COMMENT Newsletter

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COMMENT for July/August 2022

COMMENT is an informative newsletter targeted to the unique niche that CLU advisors occupy in the financial services industry, with a focus on risk management, wealth creation and preservation, estate planning, and wealth transfer.

Recent Technical Updates Involving the Value of Life Insurance

by Florence Marino

Let’s examine the recent Canada Revenue Agency (CRA) technical interpretations involving life insurance and valuation. Charitable Gift of a Permanent Life Insurance Policy Arising from a Term Conversion A charity may provide a receipt for a gift of a life insurance policy for its fair market value (FMV).

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Retirement Income and the Order of Asset Withdrawal

By Frank Di Pietro

Canada’s population is aging quickly. According to Investor Economics, there will be more than 10 million Canadians over the age of 65 within 20 years, representing nearly one-quarter of the total population. Since the average retirement age is 63 and Canadians are living longer, the average retirement could last 25 to 30 years or more in some cases, using current mortality tables.

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Saskatchewan 2022 Budget Highlights

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Saskatchewan 2022 Budget Highlights

On March 23, 2022, the Saskatchewan Minister of Finance announced Saskatchewan’s 2022 budget. This article highlights the most important things you need to know.

No Changes To Corporate or Personal Tax Rates

There are no changes to Saskatchewan’s corporate tax rates or personal tax rates in Budget 2022.

Increased Value-Add Agriculture Incentive Tax Credit

Budget 2022 increases the tax credit rate for the Saskatchewan Value-added Agriculture Incentive up to 40%, depending on the amount being invested. This credit is only available for capital expenditures valued at $10 million or more for newly constructed or expanded value-added agriculture facilities in Saskatchewan, such as canola crush facilities and pea protein processors.

Increased Technology Start-Up Incentive Tax Credit

This initiative offers a non-refundable 45% tax credit to anyone investing in eligible start-up businesses that are either developing new technologies or applying existing technology in a new way. Budget 2022 increases the annual cap of the Saskatchewan Technology Start-up Incentive tax credit to $3.5 million per year.

Changes in Education Property Taxes

Budget 2022 increases the mill rates (amount of tax payable per dollar of a property’s assessed value). The new education property tax rates are as follows:

  • Agricultural — 1.42 (from 1.36)

  • Residential — 4.54 (from 4.46)

  • Commercial/Industrial — 6.86 (from 6.75)

  • Resource — 9.88 (from 9.79)

Changes In PST Charges

Budget 2022 includes two PST changes. Audiobooks will be exempt from PST sales as of April 1, 2022. As of October 1, 2022, PST will be charged by various places that charge admission, including sporting events, concerts, museums, and fairs. It will also be applied to gym memberships and golf memberships.

Improvements In Child Care Options

Budget 2022 commits over 300 million dollars to improve child care options. The money is committed as follows:

  • $309.6 million for early learning and child care. This includes funding provided via the Federal-Provincial Early Years Agreements.

  • $4.3 million to create 6,100 new child care spaces.

Helping The Healthcare System Thrive

Budget 2022 also commits a record 6.8 billion to help the healthcare system thrive. The money is committed in a variety of areas, including:

  • $21.6 million to reduce the surgical waitlist. 

  • $12.5 million for 11 additional ICU beds. The government’s goal is to bring the total of ICU beds in the province to 90 by 2022-23, increasing to 110 by 2024-25.

  • $470 million for mental health and addictions services programs.

We can help!

We can help you determine the effect of tax changes in this year’s budget on your personal or business finances. Get started today and give us a call!