Saving Tax on Investment Real Estate

Nobody likes to pay taxes. But not everyone knows strategies to make sure they only pay the minimum. My legal expertise could save you big money on the tax when you sell investment properties!

Check out this short interview I did in 2011. It was recorded when RMLO Law LLP was still called Ritchie Mill Law Office. #TBT #ThrowBackThurday

 

Buying or selling property in Alberta? Contact Barry now.

Non-Resident Taxes

Non-Resident Tax:
A Sleeping Bear with a Big Bite.

As a real estate lawyer, I was happy to have one of my favourite realtors send me a new deal where I would be the seller’s lawyer. The first sign of trouble was a big add-on clause that confirmed the sellers were non-residents of Canada. “Uh-oh, could be trouble,” was my first reaction. Then I thought, “if the contract is making a special note that the sellers are non-residents, maybe they have the non-resident tax thing under control…?” When I chatted with the sellers and asked the question, no such luck. They knew nothing about any Canadian tax they might have to pay as non-residents and, in fact, had done nothing about tax of any kind in the 12 years they had owned the property. Now I’m really concerned and here’s why. Continue reading

Tax Planning Equals Profit

Taxes: A Penny Saved Is a Penny Earned.

Do you own a business or a substantial amount of real estate? Let’s start with a few simple propositions:

  1. You want to pay as little tax as possible both while you are an owner and then when you sell.
  2. Tax rules for Canada are set out in the incredibly complicated Income Tax Act.
  3. Sophisticated, conservative tax planning can reduce your tax substantially.

Continue reading

RRSP Mortgage Guidelines

With an RRSP Mortgage,
Can You Really Have Your Cake & Eat It Too?

Well, there’s still some things to consider about my previous post regarding Jamie Golombek’s column on RRSP mortgages in the National Post. It’s new for the CRA to recognize that interest is deductible in the circumstances as set out in the article, so this bears a bit more analysis. My last kick at the cat is as follows: Continue reading

RRSP Mortgage

You CAN Have Your Cake & Eat It Too, Says The CRA.

Many clients want to use their own RRSPs to help them buy investment property. Previously, it hasn’t worked because you can’t do a ‘non-arm’s length mortgage’. In other words, you can’t lend to yourself. The exception was for a personal residence—but not allowed for an investment property.

 News Flash! According to The National Post’s tax expert Jamie Golombek, a CRA technical interpretation says this can sometimes happen.

Continue reading

Thinking about a Tax Shelter? Think Again!

tax

“If it seems too good to be true…”

is the title of a column by tax expert Jamie Golombek. Jamie’s column is yet another reminder to all of us that the Canada Revenue Agency (CRA) is death on questionable charitable tax shelters.

Essentially, if a tax shelter promoter says you will get a tax receipt for an amount that exceeds your donation, it is likely not a valid tax shelter. Some of these schemes promise deductions of four or five times your donation amount. Normally the CRA isn’t very forthcoming in giving their opinion on any particular tax issue. For tax shelters, however, they are crystal clear. They will audit and disallow not only those bloated deductions, but also your actual donation amount. Then they will pursue for penalties. Continue reading

Tax Charity Scam

Podcast Episode 14: “Tax Charity Scam.”

Fighting with tenants over small amounts of rent or security deposits is almost never worth it. Unhappy tenants can falsely report you to the Canada Revenue Agency (CRA) and trigger audits. Tax schemes that promise deductions much larger than a charitable donation are almost always found to be shams and disallowed by the CRA. You will almost certainly lose your deduction and the charitable donation itself along with spending huge amounts of money on legal and accounting fees.

Download the audio file (Mac control + click + “save as” / PC right click + “save as”) HERE.

The full-text version of this Tale from the Trenches can be found HERE.

Contact Barry McGuire now. Alberta real estate needs an Alberta lawyer.

Tax Charity Scam (Handout)

Text Notes for Podcast Episode 14: “Tax Charity Scam.”

Fighting with tenants over small amounts of rent or security deposits is almost never worth it. Unhappy tenants can falsely report you to the Canada Revenue Agency (CRA) and trigger audits. Tax schemes that promise deductions much larger than a charitable donation are almost always found to be shams and disallowed by the CRA. You will almost certainly lose your deduction and the charitable donation itself along with spending huge amounts of money on legal and accounting fees.

Download the handout (Mac control + click + “save as” / PC right click + “save as”) HERE. Continue reading