Tax Shelters : Tax tips

 

Tax shelters

Tax shelters are transactions structured in such a way as to provide a tax benefit in excess of the cash investment. For the first time in 2003 there is a tax shelter that has insurance from Lloyd’s that will pay any taxes, interest or penalties arising as a result of a reassessment by CRA (the Canadian income tax department).

Understand the risks before investing in a tax sheltered investment

Canadian income tax shelters are always being sold for the current taxation year. Be sure you understand the risks, both business and tax, before making any decision to invest in a tax sheltered investment or charitable donation gifting arrangement.

Business and tax implications of your investment

Before acquiring any tax shelters by the December 31 deadline ensure you understand the business and tax implications of your investment, as well as the position of the Canada Revenue Agency (the Canadian income tax department) with respect to the shelter.