2019 Ontario Budget

2019 Ontario Budget

The 2019 budget for Ontario was announced by Vic Fedeli, Finance Minister, giving details of a deficit of $11.7 billion for 2018-19 and $10.3 billion for 2019-20. Below are details of the key changes in relation to personal and corporate finances.

Personal

The budget did not announce changes to personal tax rates.

Ontario Childcare Access and Relief from Expenses (CARE) tax credit

Effective the 2019 tax year, the budget introduces a new refundable Ontario Access and Relief from Expenses (CARE) personal income tax credit, beginning with the 2019 tax year.

The tax credit will be based on the taxpayer’s family income and eligible child care expenses. It will provide the following tax credit per child up to:

  • $6,000 under the age of 7

  • $3,750 between age 7 to 16

  • $8,250 with a severe disability

The new credit will be calculated as the amount of eligible child care expenses multiplied by the credit rate shown below. The credit is eliminated when family income is greater than $150,000.

For 2019 and 2020, the taxpayers may claim the new tax credit on their tax returns. In 2021, Ontario intends to allow families to apply for regular advance payments.

Estate administration tax

Effective Jan 1, 2020 the budget eliminates the Estate Administration Tax on the first $50,000 of an estate’s value and extends the filing deadline of the Estate Administration Tax Information Return with the Ministry of Finance to 180 days (from 90 days) after the receipt of an estate certificate, and extends the deadline for filing amended information returns to 60 days (from 30 days).

Review of property tax assessment system

The province will review the property tax assessment system.

Addressing tax loopholes and tax integrity

The province has created a specialized unit of tax experts to find and address tax loopholes and abuse.

Corporate

The budget did not announce changes to the provincial corporate rate.

Ontario interactive digital media tax credit

The budget reduces the minimum Ontario labour expenditure to qualify as a specialized digital game corporation to $500,000 (from $1 million.)

Review

The budget will review the Ontario Innovation Tax Credit, other research and development incentives and cultural media tax credit certification process.

Please don’t hesitate to contact us if you have questions about how the budget will affect you.

Financial Planning

A financial plan looks at where you are today and where you want to go. It determines your short, medium and long term financial goals and how you can reach them.

Why do you need a Financial Plan?

  • Worry less about money and gain control.
  • Organize your finances.
  • Prioritize your goals.
  • Focus on the big picture.
  • Save money to reach your goals.

What does a Financial Plan include?

There are 2 main sides your financial plan should address: Accumulation and Protection

Accumulation:

  • Cash Management – Savings and Debt
  • Tax Planning
  • Investments

Protection:

  • Insurance Planning
  • Health Insurance
  • Estate Planning

What’s the Financial Planning Process?

  • Establish and define the financial planner-client relationship.
  • Gather information about current financial situation and goals including lifestyle goals.
  • Analyze and evaluate current financial status.
  • Develop and present strategies and solutions to achieve goals.
  • Implement recommendations.
  • Monitor and review recommendations. Adjust if necessary.

Next steps…

  • Talk to us about helping you get your finances in order so you can achieve your lifestyle and financial goals.
  • Feel confident in knowing you have a plan to get to your goals.

Financial Planning for Business Owners

Financial Planning for business owners is often two-sided: personal financial planning and planning for the business.

Business owners have access to a lot of financial tools that employees don’t have access to; this is a great advantage, however it can be overwhelming too. A financial plan can relieve this.

A financial plan looks at where you are today and where you want to go. It determines your short, medium and long term financial goals and how you can reach them. For you, personally and for your business.

Why do you need a Financial Plan?

  • Worry less about money and gain control.
  • Organize your finances.
  • Prioritize your goals.
  • Focus on the big picture.
  • Save money to reach your goals.

For a business owner, personal and business finances are connected. Therefore both sides should be addressed: Personal and Business.

What does a Financial Plan for a Business include?

There are 2 main sides your business financial plan should address: Growth and Preservation

Growth:

  • Cash Management- Managing Cash & Debt
  • Tax Planning- Finding tax efficiencies
  • Retaining & Attracting Key Talent

Preservation:

  • Investment- either back into the business or outside of the business
  • Insurance Planning/Risk Management
  • Succession/Exit Planning

What does a Personal Financial Plan include?

There are 2 main sides your financial plan should address: Accumulation and Protection

Accumulation:

  • Cash Management – Savings and Debt
  • Tax Planning
  • Investments

Protection:

  • Insurance Planning
  • Health Insurance
  • Estate Planning

What’s the Financial Planning Process?

  • Establish and define the financial planner-client relationship.
  • Gather information about current financial situation and goals including lifestyle goals.
  • Analyze and evaluate current financial status.
  • Develop and present strategies and solutions to achieve goals.
  • Implement recommendations.
  • Monitor and review recommendations. Adjust if necessary.

Next steps…

  • Talk to us about helping you get your finances in order so you can achieve your lifestyle and financial goals.
  • Feel confident in knowing you have a plan to get to your goals.

Getting the best from a financial advisor

Working with a professional to help you to make sense of your finances can be a wise move, but for this relationship to work effectively it is important that you understand what to expect from your financial advisor.

What can your financial advisor help you with?

  • Defining your financial goals and creating a step by step plan or strategy to achieve them.
  • Planning for the future, including for retirement, future education or housing needs.
  • Choosing the mix of investments and assets that suit your goals, lifestyle, time horizon and appetite for risk.
  • Building a solid estate for your family to inherit in the future.
  • Choosing the most tax-efficient methods of saving and investing.

What should your financial advisor inform you of?

  • The range of services that they offer and how much and by which method you will compensate them.
  • Your mutual responsibilities and obligations towards each other.
  • What the planning process will look like and the documents that they will provide you with.

What will your financial advisor need from you or need to ask you about?

  • What your financial goals are.
  • What your personal circumstances – such as your marital status, any dependents, your job, earnings and tax situation.
  • Any investments or assets that you currently have – such as registered accounts, workplace pensions, property etc.
  • Your appetite for risk and investment preferences.
  • Information on your income and also your outgoings, including debts such as mortgages, loans or credit cards.
  • Whether or not you have a will, and its contents.
  • Your estate and inheritance planning situation.

If you’re looking to achieve your financial goals, talk to us. We can help.

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