<![CDATA[PRUDENT MONEY COACH - Blog]]>Fri, 07 Feb 2025 09:07:58 -0800Weebly<![CDATA[2025 Tax Season is (almost) here!]]>Mon, 03 Feb 2025 06:36:18 GMThttp://prudentmoneycoach.com/blog/2025-tax-season-is-almost-here
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Photo by StellrWeb on Unsplash
Happy February! I feel like January just flew by. In case you haven’t heard, the Canada Revenue Agency (CRA) has been in the news a few times since my last newsletter in December. 
Here are two of them:

  • “The CRA is administering the extension for 2024 charitable donations.” You have the option of including your January 1 to February 28, 2025 donations in your 2024 tax return. If you do not have enough taxable income to absorb the donation tax credit, you can carry-forward the credit up to 5 years.

  • Back in early June 2024, "Budget 2024 announced an increase in the capital gains inclusion rate from one half to two thirds for corporations and trusts, and from one half to two thirds on the portion of capital gains realized in the year that exceed $250,000 for individuals, for capital gains realized on or after June 25, 2024." However, on January 31, 2025, there was news that "all capital gains realized before January 1, 2026 will be subject to the currently enacted inclusion rate of one-half, unless an exemption applies.

CRA is now preparing its system for the 2025 tax season. Here are some key dates:
  • February 24, 2025: The first day you can file your 2024 tax return online.
  • ​April 30, 2025: Deadline to file your 2024 tax return for most people and deadline to pay taxes owing.
  • June 16, 2025: Deadline to file 2024 tax return for self-employed individuals and their spouse/common-law partners. Remember that amount owing is due April 30. You can overestimate the amount and pay it on April 30, then claim the difference back as a refund.

One question that I get asked often is how much I charge for preparing a tax return. The answer? It depends. 😅 Simple tax returns cost less than complex ones. I would be happy to do a tax interview with you, then send you a quote. Generally my price includes 30 minutes of assistance if you are assessed by CRA.
If you would like to know my process (step-by-step), send me an email and I will send it to you. I would like to keep this bi-monthly newsletter relatively short.

I prioritize returning clients. Let me know if there are changes in your tax situation such as getting married, having a baby, moving to a new province, etc. I would appreciate it if you could gather your data as early as possible and let me know as soon as your data is complete. It would be more effective for me to work on your file in one go once all the information is complete, rather than working on your file multiple times as information trickles in. 

Disclosure:
I am not an accountant or a CPA (Chartered Professional Accountant), but a Tax Professional. I have been helping individuals with tax preparation service since 2013. Here are interesting facts that perhaps you know already
-  Not all accountants are CPA’s.
-  Not all CPA’s do taxes.
-  Not all accountants do taxes.
I’m not an accountant or a CPA, but I do taxes. 🙂

OK, that’s all for now. Thank you for reading my newsletter. I appreciate your time. 


Sources:
https://www.canada.ca/en/revenue-agency/services/charities-giving/giving-charity-information-donors.html
https://www.canada.ca/en/revenue-agency/services/tax/individuals/topics/about-your-tax-return/tax-return/completing-a-tax-return/deductions-credits-expenses/line-34900-donations-gifts.html
https://www.canada.ca/en/department-finance/news/2024/06/capital-gains-inclusion-rate.html
https://www.canada.ca/en/revenue-agency/news/newsroom/tax-tips/tax-tips-2025/update-cra-administration-proposed-capital-gains-taxation-changes.html
https://www.canada.ca/en/revenue-agency/news/newsroom/tax-tips/tax-tips-2025/stress-free-filing-starts-now-here-are-five-easy-ways-help-you-get-ready-for-tax-season.html
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]]><![CDATA[Financial Lessons Learned from My Recent Trip Abroad - December 2024 Prudent Money Coach Tax & Money Tips]]>Mon, 02 Dec 2024 05:47:09 GMThttp://prudentmoneycoach.com/blog/financial-lessons-learned-from-my-recent-trip-abroad-december-2024-prudent-money-coach-tax-money-tips
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Photo by Walter Chávez on Unsplash
Greetings! Can you believe that we are now in the last month of 2024? Did you accomplish any goals you set for yourself?
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Recently I had an opportunity to visit my parents back home. It was a privilege to still have both my parents with me and to have an opportunity to sleep in my childhood home, in a bedroom I used to share with my siblings. Now that I’m a professional dealing with money and taxes, I look at things through different lenses. Here is some interesting money-related information that I learned/ encountered from my two-week trip.

  • While it is possible to claim “donation tax credit” back home, many people are not doing it due to the complexity involving tax reporting. If you live in Canada, be thankful that claiming donation tax credit is quite straightforward and easy.

  • When you rent, generally you pay first month’s rent and a deposit equivalent to a month’s rent, which may be applied towards your last month’s rent. Did you know that if you rent a whole house in Indonesia you would need to prepay your 12-month rent? Wow! I wish I could interview renters and ask how they come up with that much cash. And did you know that some landlords even use multi-year leases? You get to lock in your rental cost, let’s say for 4 years, but how will you come up with all the cash that is equivalent to 48 month’s rent? I believe this requires creative financing, perhaps involving financial help from extended families.

  • In developing countries where money is tight, it is very common for extended family members to help each other out. However, whenever money is involved, it is usually a bad idea when agreements are not in writing. One person’s memory may be different from others. It may become a he said/she said situation. A record that shows detailed information such as date of transaction, agreement between parties, amount involved, etc. may help avoid conflicts. Bonus if it is a legal paper so it can be enforced. 

  • When you lend someone money, it may be best to treat it like a gift with no expectation of payback. If you do get it back, that’s great; if not, you won’t be disappointed.

  • When you give someone money, it is not yours anymore. The recipient is free to give the money to anyone, including someone you would’ve disapproved of. So, give wisely. I have seen so many examples of this. Here is one example: an adult gives money to her adult brother, to help with day-to-day expenses. But the brother spent it on gambling. In this example, it may be best to give the money directly to her niece’s school to pay for tuition, or to purchase groceries directly and deliver it to the brother.

  • Do not mix business and personal, especially when it is a family business. There should be an agreement on how much each person is entitled to have periodically; for example, $5,000/month/person. It is best to have more than 1 person to approve business expenses, for example, 2 signatory authorities; this way, no individual can freely spend business money. 

There are so many more money lessons I learned, which apparently are quite universal. If I may summarize: When money is involved, it is usually best when there is a record-keeping and accountability partner(s).

Wishing you and your family a very Merry Christmas and a Happy New Year! May you encounter peace and joy from Christ.

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