6 money saving tips to always remember

I found this article recently and I feel some of the provided tips are worth taking note of to save money. The article was posted at CanadianLiving, I selected my favorite tips for you below, some of the numbers are outdated but the concepts still apply:

Avoid getting a tax refund
While getting back a juicy tax refund may feel good, a large return is actually a sign of poor tax planning, says Wallis. "Think of it as giving the government an interest-free loan." While that money was sitting with the government for 12 months, it could have been earning you interest in an investment. To keep that money in your own pocket, ask your employer for a T1213 Form to reduce the amount of taxes taken off your paycheque each month.

Reap the benefits of the self-employed
If you own your own business, consider paying your kids or a lower-income-earning spouse a salary or wages and deduct it against your income. Bamber, for example, pays her daughter to file and answer the phones in her home-based business instead of giving her an allowance.
TIP: If you work out of a home office, you can also write off a portion of all eligible home costs, including mortgage interest, property taxes and utilities.

Add up all your medical expenses
Many of us assume we don't have enough medical expenses to get a tax credit (the total amount of receipts must exceed $1,844 or three per cent of net income, whichever is less), but they can add up quickly. Look for things that aren't an eligible expense under your group plan and don't forget to include any health-care premiums you're paying at work, advises Cleo Hamel, a senior tax analyst with H&R Block in Calgary.

Claim all your child care
"A lot of parents think if a neighbour is taking care of their child, they can't claim it," says Hamel. "But if you're paying someone and getting a receipt for it, it's a child-care expense." Generally, the lower-income-earning spouse makes the claim, which is either two-thirds of your earned income or the total of the individual maximums for each of your children ($7,000 for each child under seven and $4,000 for children seven to 16), whichever is less.

Take advantage of the Canada Child Tax Benefit
If you had a new addition to the family in the past year and your household income is less than $35,595, make sure you've applied for the Canada Child Tax Benefit.
TIP: You may also qualify for the new Canada Learning Bond, which is basically a gift from Ottawa of $500 for each child born after Jan. 1, 2004, and an additional $100 per year in grant money for up to 15 years.

Pool your charitable donations
If you and your spouse both make charitable donations, combine the receipts and claim them on one return (you only get a 15.5 per cent tax credit for your first $200 of donations but 29 per cent for everything over that).

 

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