1) If you have capital gains (inevitable, unfortunately, if your portfolio is growing) you may want to harvest some capital losses to offset those gains (if there are any). The good news is that you only pay income tax on 50% of your capital gains. If your marginal rate is 50%, then for every $100 of gains you pay $25.
2) RESP contributions: the best way to maximize the Canada Education Savings Grant (CESG) is to pop $2,500 for each child into their respective RESP's and you will receive the $500 CESG per child about a month later. We strongly encourage folks to take advantage of this free money (it is not often that the federal government gives you free money). The cut-off is calendar year end (December 31). If you happen to miss a year, you can play catch-up in future years (1 year of catch-up per year).
3) While we tend to focus on TFSA contributions at the beginning of each year (with automatic client deposits) and you can always make up for missed contributions, remember that come January 1, 2017, if you have made any withdrawals in 2016, you can deposit them back plus make your 2017 contribution.
4) Charitable donations: December 31 is the last day for the 2016 tax year, whereby you can receive a federal charitable tax credit of 15% on the 1st $200 and 29% on any amount above the initial $200 (to a registered Canadian charity). for you really generous folks, you can only donate up to 75% of your net income (after deductions, before taxes). You can donate securities which will be valued at market prices (at the time of the donation) and not have to pay any capital gains tax. There some restrictions on certain securities.
Big thanks to High Rock Certified Financial Planning (CFP) professional Bianca Tomenson for her input.
Wishing you all a wonderful holiday season and a very happy, healthy and prosperous 2017!
Scott Tomenson,CIM Managing Partner, Chief Investment Strategist