An early start in your tax and financial planning will Canadian taxpayers to save money that later serves to invest wisely. Learning about tax credit opportunities in the beginning of the year as part of your financial planning can make you save money later on. Tax planning always involves taking decisions early that later will have a n effect in how much money do you save. One way to save in taxes and give your financial planning a boost is with the “Donate, recover your taxed income, and invest” strategy.
This strategy can help you to keep more of your hard-earned dollars and boost your family’s net worth. The Income Tax Act allows Canadian taxpayers to make donations to registered charities and then claim up to 50% of the amount donated. If you take advantage of a donation, your tax refund will increase as much as twice the size you thought it was. It lets you to recover close to 30% of our salary income withheld by the government as income tax. It is like having a raise every year of 30%.
Personally, part of our tax and financial planning has been participating with Mission Life Financial, helping us to finance AIDS pharmaceuticals donated to a registered Canadian charity. After hours of research, analysis and due diligence, I decided to take part in this tax saving strategy with the following very successful results: In 2008, I got a tax credit of Cdn$8,977.23, and in 2009, the tax credit was Cdn$8,544.24. For 2010 I already donated and I’m expecting a tax credit close to Cdn$21,729.
The questions you might have now are: What we’ve done with this money? How much of these money has used to fuel our financial planning strategy? How much our net worth has increased? I’ll tell you that the 2008 tax credit helped me to juggle the economic downturn where, thanks God, I became unemployed; therefore, we didn’t do any investment. With 2009 tax credit, I learned how to invest in tax liens in USA and started investing in tax liens in Indiana’s commissioner’s sales. We foreclosed in 4 properties, and today, our net worth increased exponentially. With 2010 tax credit, we are planning to do the same: Invest in tax liens.
Managing and building personal wealth is very important and can start with this excellent tax and financial planning strategy. Having the funds available for investment purposes it’s often a challenge but participating in a tax saving program like Mission Life Financial could be the mean of freeing capital or cash that otherwise is not available. Donating, recovering your hard-earned income, and invest; again and again, year after year, it’s very simple and an easy strategy to do. If I have been able to do it, any Canadian taxpayer can do the same. It is not rocket science. It is decision taking action.