Do you know how to use the Disability Tax Credit?

Lynne Protain — Fri, 12 Apr 2013 13:00:26 +0000

If you or someone in your family has a disability, you already know what a profound impact it can have on your quality of life and your finances. Family support is always vital, of course, and there are programs and organizations that can also provide help and support, but anything that can be done to reduce the additional financial costs of a disability is always welcome. The federal government provides tax relief for those with certain types of physical or mental impairments through the non-refundable Disability Amount Tax Credit (DTC).

The tax relief can be significant and ongoing but many people don’t even know they qualify for the DTC, or that if they have missed claiming it in the past, they may be able to seek adjustments and reclaim those missed opportunities. Here is some basic info to be sure the DTC will work for you.

To be eligible for the DTC you must complete Canada Revenue Agency (CRA) form T2201.
A qualified person – usually your doctor – must certify that you have a severe and prolonged mental or physical impairment that markedly restricts the ability to perform the basic activities of daily living. If you are receiving extensive, life-sustaining therapy, you may also be eligible for the DTC, under certain conditions.
Once approved, you may claim the disability amount on your income tax return.
If all or part of the disability amount is not claimed by the taxpayer with the disability (who is also a dependent), it can be transferred to a spouse or common-law partner or another supporting taxpayer, who may also be able to claim the Caregiver Amount Tax Credit.
The DTC can also be a qualifier for obtaining other tax breaks, such as for certain medical expenses.
If you have missed claiming the DTC in past years, you can seek adjustments to your previous returns for up to ten years through the CRA’s Fairness Policy. If you want the CRA to reassess a tax year and allow a claim for the DTC, you must either submit CRA Form T1ADJ or send a letter of request, with details, to the CRA. You must also obtain the support of a medical practitioner who certifies that the impairment existed during the previous tax years.

It can be very complex to get the most from the DTC, especially when it comes to the interrelationships with other financial provisions for a disabled person. I suggest that you contact me to discuss in order to ensure that you have full clarity on this issue.

There are many people who go through life with a feeling of nothingness. The consistent energy that they feel from waking up, to clocking in at work to then heading home is a lack of excitement and purpose. Life becomes a continuous routine. Days turn into weeks, weeks into a year and before they know it, years have passed by and they are still telling themselves that they will do and live the life that they desire. They have an idea of the way they want their life to feel and look like but have no idea how to get to their ideal destination. Most people just need a plan to help them to connect the dots of how to live each day with complete satisfaction.

Entrepreneur and brand architect, Jesse Jones, knows what it is to take your passion from a dream to living your life’s purpose. Three years ago the entrepreneur, who started off as a consultant turned his own passions into the creation of successful Toronto based company, Ten81 Lifestyle Inc. The boutique agency helps brands connect with consumers through non-traditional strategies involving lifestyle-based marketing, digital and branding initiatives. Ten81’s philosophy is to find innovative techniques to connect brands to consumers in order to create deeper connections and to empower the consumer. If you don’t know Jesse than you have definitely heard of some of the brands he has worked with– McDonald’s, Bell, Much Music, Mattel, Royal Bank of Canada, Converse, and Fuji Film to name a few.

Ask him and he will tell you that when passion is properly cultivated, it will seep into everything you do – the way you talk, who you surround yourself with, the company you choose to invest your time and skills in, etc. According to Jesse, finding your passion is about looking inwards to uncover what you truly love and then take massive action to make it happen. Some may think that to live a passionate life, you have to be an entrepreneur or that you should pursue interests outside of your 9-5, but Jesse wants to show people that being absolutely passionate about what you do while working for a company is very possible as well. One of his missions is to create an alignment between companies and their employees so that these companies foster passion in their workers.

No matter the avenue you choose, whether it be a 9-5, an entrepreneur or working on a passion project that makes you feel fulfilled each day, Jesse believes that there are 3 key steps that everyone must take to be open to the flow of passion and opportunity into their lives:

Uncover Your Passion

What would you do every day that no one would need to force you to do? Tap into that feeling and work from there. Not everyone is born knowing what they love or genuinely what excites them. Jesse advises that a little deliberate searching is the best process, “first uncover what the passion is, find where it lives in you, figure out what it will take to get you there, then seek people out who are doing and living what you want to do.” When you start making these moves, you will soon realize that no matter how hard you try, it is impossible to figure out your passion by thinking about it, you need to take action.

Be About Your Passion

Many people find themselves spending a lot of time thinking about their passion and dreams instead of doing it. The biggest hurdle is getting past these debilitating thoughts so that you can truly give yourself and your passions a chance. Often times finding what you love to do and then succeeding at it is a process of trial and error. “A lot of people get side tracked when they don’t see immediate benefit,” explains Jesse, “but, the most important thing is that you stay the course and ride through the ups and downs. Start doing what you love just a little, then develop and harness it.” Most people get paralyzed by fear – they know what they like but get stuck in a standstill because they over think their way out of really trying.

Talk About Your Passion – Share it and See it Spread!

But once you passion is discovered, what excites and drives you will become contagious. People will begin to feel your motivation and energy and want to align themselves with it. Jesse created U-ology (a division of Ten81 Lifestyle) as a way to motivate and educate others to live passionate lives and to understand who they are. While his mission has always been to empower others personally and through his company, the opportunity to take this to a global scale was born when he accepted an invitation to speak at Queens University. After he shared his story with the attendees, people had so many questions for him such as “how did you get to a point of doing what you love” or “you look like you are having so much fun, how?” By sharing what he loved to do with others, it not only encouraged them to seek what they loved as well but also created further opportunities to share his purpose with other audiences such as his recent trip to speak at a Yale University training session this past March.

When you love what you do, people take notice and want to find ways to be a part of it which opens up more opportunities for you to continue to do what you love. So, don’t be afraid to share your interests and goals.

To connect with Jesse or to learn more about his initiatives follow him @iamjessejones

Corey Kareem Roberts on set of Roger’s UYE with guest, Belinda Barrocks

Sometimes a rise to the top is not a linear line of progression but a winding road of curves and unfortunate dead ends. The saying “If you want to make God laugh, tell him your plans” is one of the truest statements written. Plans do not always work out in the ways in which we had originally envisioned. Ask anyone who’s achieved great things and they will tell you about the difficulties and setbacks they faced before finding success. For those who proclaim an overnight success story – perhaps, it was the longest night in history?

Business entrepreneur and budding television producer Corey Kareem Roberts, is the first to admit that the path to the greatest success stories can often come with massive failure. Without failure there is no growth or lesson learned. Corey’s story started off by living the dream he had originally imagined: living in New York City, graduating from University, interning for some of the top networks in America (MTV, NBC), and rubbing shoulders with music’s elite at Atlantic Records — Only to find himself back in Canada due to the difficulty of securing a job in the US with a Canadian Student Visa (post-Bush economic catastrophe era).

Corey first tried the 9 to 5 route, working for an HR company where he was paid well but did not feel satisfied with the direction in which his career was going. But, when a dream is placed in your heart it is hard to compromise your desire for capital. Leaving the safety net of his job, he took some time to explore his passions and create a new plan for his life. Realizing that the building blocks of success is simply in persevering, seizing opportunities and creating your own path, Corey took the step to create his own show UYE (Unified Young Entrepreneurs) on Rogers Television.

There is a lot that can be learned from his story. Black Ink Magazine caught up with Corey to find out more about his successful first venture into hosting and producing television, how he manages to stay persistent, and what some of his next moves are.

BIM: Tell us how you got started with Rogers Television?

I started off volunteering for the talk show Daytime Mississauga where I was able to make connections with a lot of the producers within the company. At the same time, I was also doing some freelance work for Tri-Lite TV which is a production company that provides support for sports, news and entertainment events across Canada. Throughout this time I kept seeing a Rogers commercial, that I’m sure everyone’s seen, to pitch a show for the network. I saw it over and over again and decided why not? To be honest I didn’t think I was qualified, but a woman by the name of Theresa Laurico (SociaLIGHT Conference) whose opinion I really respect told me to go for it. She said, “The time is now.” So, I started writing a pitch and treatment for the show that I wanted to create. It was eventually accepted; I shot a pilot and received great feedback. UYE aired this past August 2012.

BIM: What was your inspiration behind creating the concept for UYE?

It came from my own failures. I did everything I was supposed to do right out of university; I graduated from City University of New York – Brooklyn College with a B.A in Communications. Immediately afterwards, I did 4 internships for some very well known companies in the industry – NBC, MTV, Fuse TV and Atlantic Records. But due to timing and being a Canadian living in the States during tough economic times, I was not able to get hired at these companies. So, I moved back to Canada. The experience taught me the importance of timing and creating my own opportunities.

I started UYE as an outlet for myself and to provide a platform for young entrepreneurs who have gone through their own share of ups and downs in chasing their dreams. I wanted a place for them to share their stories and the lessons that they learned along the way.

BIM: In preparing for your own interviews did you look to any media figures for inspiration?

I started watching a lot of CNN for inspiration. I like the level of professionalism that Don Lemon demonstrates in his interviews. Also, he is often criticized and perhaps not the people’s first choice, but I also looked to Pierce Morgan for inspiration. I think he’s not afraid to go there and ask the right questions.

BIM: This is your first time being in front of the camera. Did you find any difficulties in being the host?

Being a host looks a lot easier than it actually is. There is often a producer talking in your ear while at the same time you have to pay attention to what your guest is saying to you. There is a countdown and if you have only one minute left, you have to decide if you are going to wind down and finish the interview or will you ask one last question. You have to have a good judgment of time.

BIM: What are you most proud of about the show?

I’m most proud that it came to fruition. I’m proud of being a person of my word. I did exactly what I said I was going to do. I’m also proud that I was able to keep the integrity of my show. It stayed pretty much the same as what I originally envisioned.

BIM: What do you hope to do with UYE for next season?

Well first of all, I hope that there will be a next season. I need people to show their support and call the station manager at 905.897.3928 to request a second season! But in regards to what I foresee for the show, I simply want the opportunity to give more entrepreneurs their time to shine. My goal for UYE is to create a community of young entrepreneurs and to have more episodes to do this.

BIM: In your Twitter profile you state that persistence is your talent. Has that always been a characteristic of yours?

I’ve always been a persistent person. Since I was young I’ve felt like I had to work twice as hard for the things that I wanted so I’ve never been afraid to put in that work.

BIM: Who are some of your mentors or people that you are inspired by?

My mentor is a business professional by the name of Teddy, who gives such a great perspective on things; he’s a good people person and just knows how to break things down in a way that resonates with me. As far as public figures, I’m inspired by Tony Robbins who is great at teaching you how to control your mind – one of the most challenging things to do. It’s important to learn how to teach your mind to be productive and work for you instead of against you. I also respect Tyler Perry as a business man. He’s able to maintain a humble attitude although he’s achieved great success. He doesn’t talk about his money.

BIM: What are some books that have made a great impact in your life?

The Road Less Traveled by Scott Peck just makes sense on every level to me. Also, this may be a cliché choice but Rich Dad Poor Dad definitely opened my mind to a new way of thinking.

BIM: What’s the best piece of business advice you’ve received?

A very prominent business man in Brooklyn once told me this and it really stuck with me, “In life you don’t get what you deserve, you get what you negotiate.” Basically it means that you should not have an entitled attitude when it comes to getting what you want. You can’t expect for things to be given to you. You have to go out there and get it. Fight for what you want.

Our generation often falls into this entitled attitude. Going to school is not enough anymore. You are fooling yourself if you think having a degree or your Masters is enough. I believe that personal development and having people skills is becoming just as important as formal education. People should take the opportunity to invest in themselves. At the end of the day, if two people apply for a job and have the exact same credentials what’s the deciding factor if you are both qualified? Building relationships, understanding yourself and your goals and all of these personal development and people skills is what is going to help take you to the next level in pursuing your dreams.

BIM: It can often seem like there aren’t too many black Canadian professionals in top positions. If we look to the States, we can create a running list of successful black professionals for any given industry. What’s your take on this?

It could be because of a lack of black leadership in Canada but it can also be a lack of an effective platform to promote black leaders of the community. If your parents are not connected to these professionals or you do not attend any black professional organizations, then you will not know anything about the people who are doing big things in our community. In the States, you do not need to be involved with specific organizations to know. You can simply turn on the television and see Barack Obama or flip open a magazine and see another business leader. In Toronto, you have to actively be involved. I believe that the black community in Canada needs to work on solidarity and supporting each other. If you look to other communities in Canada, they exemplify working together.

BIM: What’s NEXT for you?

Right now I am working on further developing my show and gathering support for it to be picked up for another season. My long term goal is to have my own non-profit organization for preteens 13-18 years old. I want to create an organization that works to invest in their dreams and beliefs as well as offers them perspective. A lot of organizations mainly give money to invest in youth but I want to create something that will focus on providing under-privileged teens the opportunity to travel and gain worldly perspectives on life. I believe this will help them elevate their mind. Travel is the greatest teacher and can do more for someone than just preaching to them or watching a movie.

Connect with Corey on any of his below social media pages. Also, don’t forget to check out his YouTube Channel for episodes of season 1 and to find out how you can request a second season.

Facebook.com/coreykareemUYE

@coreyanism1584

It’s that time of the year when we focus on RRSP contributions, filing our tax returns and wondering how we can save more on taxes and increase what is in our pockets. What better time to talk about your RRSP carry-forward room?

When retirement time rolls around, your RRSP eligible investments may be a significant source of your income – and you can make it even more significant by understanding – and taking full advantage of – its carry-forward potential.

Available RRSP contribution room may be carried forward to future years if the deduction is not claimed on the current year’s tax return. Add a few simple strategies and you can fill that carry-forward room in ways that will pay off for you, now and later:

Make a contribution now, take part of the deduction now Use a portion your contribution for this tax year to reduce your taxable income to the next marginal tax bracket.

Make a contribution now, take the deduction later Make your maximum contribution to RRSP eligible investments in the current tax year but save the deduction for a later year when you know you’ll be in a higher tax bracket.

Take an RRSP loan to fill your carry-forward room This strategy works when the interest rate is low enough and you repay the loan as quickly as possible, preferably in one year or two at the most. You can use your tax refund to repay part of the loan.

Know your age-related options If you’re turning 71 this year and don’t have a spouse who is younger than 71, this is your last opportunity to make a contribution to your RRSP eligible investments, although any undeducted contributions can be carried-forward until the year of death. If you’re 72, have carry-forward room, and a spouse 71 or younger, you can make a contribution to a spousal RRSP eligible investment with your spouse as the annuitant.

Shelter the non-eligible portion of a severance/retiring allowance You can do this by using some or all of the allowance to fill RRSP contribution carry-forward room.

Shelter a commuted pension paid out in cash If you commute your pension and have received an excess – and taxable – amount in cash, you can use your RRSP carry-forward room to shelter at least a portion of the excess.

Decrease withholding tax When an employer makes direct contributions to your RRSP eligible investments, the employer need not apply withholding tax if the employee provides evidence that they have sufficient contribution room. The employee’s most recent Notice of Assessment from the Canadian Revenue Agency (CRA) is considered sufficient evidence of contribution room.

Make the most of your RRSP eligible investments and pay yourself forward in the most advantageous ways.

Every situation needs to be assessed individually, so if you are looking for strategies or advice, contact me for further information.

Lynne Protain, PFP, BAS, is a Consultant at Investors Group Financial Services Inc. Contact: 416-471-7400 Ext. 673 or email: lynne.protain@investorsgroup.com or LinkedIn: http://ca.linkedin.com/in/lynneprotain

A positive business reputation is a hard attribute to build and can just as easily be tarnished overnight if not handled with care. The way that people view you professionally is not a fixed impression as it can be instantly reevaluated. Warren Buffett said it best, “It takes 20 years to build a reputation and five minutes to ruin it. If you think about that, you’ll do things differently”. With this perspective it is easy to see the underlining lesson to entrepreneurs and business professionals in the recent incident involving acting legend, Robert De Niro and rapper / business mogul, Jay-Z.

The synopsis of the incident is basically that there was a potential business dealing in which Robert De Niro wanted to involve Jay-Z. De Niro had reached out to Jay several times to follow up and discuss it but was upset that he had not received any response after multiple attempts. In all fairness, Jay is a pretty busy guy. And, we do not know the full details or actual events that occurred. Perhaps Jay had not even received the calls due to an assistant forgetting to let him know. There are many conclusions that can be drawn but the main lesson here is that every detail counts towards shaping the way that people view you.

Whether you are an entrepreneur or working your way up at a company in your chosen field, you are the CEO of your brand and reputation. While people often say “let your work speak for itself”, actions (or lack thereof) speak too. Sometimes louder. The most talented and skillful professional can be overlooked on a project or business deal if he / she has a negative reputation and known to be difficult or unresponsive.

How familiar is this situation? We’ve all sat in many meetings where a certain name is mentioned and everyone collectively rolls their eyes and starts issuing complaints about how difficult it is to track that certain person down to get a response. No one wants to work with said person because trying to contact them becomes exhausting and a job in of itself. Your co-workers can come up with many names to describe them: lazy, rude, unreliable, difficult, and dismissive. The list can go on. Don’t be that person.

It seems like pretty simple advice, right? Someone calls, you receive the message and respond back. An email comes into your inbox, you reply to it within a timely fashion. It seems like business, and even personal, protocol 101 but it’s almost astonishing the amount of people who do not follow this basic principle.

We live in an era of instant access – the boundary of business hours has become almost completely blurred. You would be hard pressed to find someone who does not carry a smartphone with them nearly every waking hour of the day minus bathroom time and sleep (although many still keep their phones close by in these scenarios). This makes it inexcusable to not get back to contacts in a timely manner when you have every method of communication right at your finger tips at all times.

While you may not find yourself in the same scenario as Jay-Z of being scolded at a Hollywood party by an industry legend, but on any level this should be a reminder of the business commandments or a word to the wise for all professionals.

http://ca.linkedin.com/in/lynneprotain or Twitter @LynnePro

Employ your spouse and children

Whether you carry on your business personally or through a corporation, you should consider paying a salary to your spouse and/or children. Canada’s progressive tax system, which assesses high income earners with even higher tax rates, provides an incentive to split income with family members in a lower tax bracket. Paying a salary to a spouse and/or child who pays tax at a lower rate than you can create net tax savings. But you must ensure that the salary is reasonable for the services they perform for the business.

Incorporate your business

If your business produces more profit than you need to satisfy your personal cash flow needs, then incorporation could produce a sizeable tax deferral by accessing the lower small business tax rate for active income. This deferral benefit, however, is only available if the profits are left in the company. The longer the profits are left in the company, the larger the tax advantage. It is important to note that investment income earned on prior deferrals and rental income do not receive this lower rate.

The tax deferral achieved through incorporation can create a permanent tax saving if the shares of the business are eventually sold and are eligible for the $750,000 capital gains exemption. However, if you are incurring losses this will not be the best option.

Additional advantages could be having family members own shares to have access to multiple capital gains exemptions, paying out dividends to family members who are taxed at a lower rate and receive creditor proofing from the limited liability. A licensed financial planner can help you determine which strategies work with your situation.

Invest excess cash

Since the biggest bang for your tax buck is accomplished by leaving profits in the incorporated company, the question becomes what to do with those profits. If repaying debt or reinvesting in the business operations are not options, then a smart investment plan is your best alternative.

Choosing the right investments for the excess cash inside the corporation should follow the same rules as investing your personal money such as the principles of asset allocation and diversification. This strategy is most effective for active business income below the small business limit.

Plan for your retirement

In order to make the maximum allowable Registered Retirement Savings Plan (RRSP) contribution next year, you’ll need to create the contribution room this year by maximizing reported earned income. If incorporated, you will want to review the best dividend/salary mix for your situation. As part of your overall plan, you may also want to make a contribution to your Tax-Free Savings Account (TFSA). It is important to achieve balance in your personal investment plan given all the variables and how it will fit with this year’s maximum contribution limits for business owners.

Don’t forget to think about RRSP contribution room when setting and reporting remuneration for services provided by family members who also work in the business. A corporation with taxable income over the small business limit may want to explore the use of an individual pension plan (IPP). An IPP is ideally suited to business owners in their mid-forties or older who have a past history of earning employment income from their company in excess of $100,000 per year. An IPP will allow you to shelter even more earnings from tax than your RRSP while still offering some protection from creditors.

Prepare for the sale of your business

It’s never too early to plan your business exit strategy. If you’re planning on selling all or part of your business at some point, confirm with your accountant whether you’re eligible for the small business capital gain exemption and what steps need to be taken.

Make use of R&D expenses

Expenses related to research and development activities incurred to develop and enhance your products and production processes, may qualify for valuable tax incentives in the form of refundable and non-refundable tax credits. While the guidelines governing program eligibility can be complicated, a wealth of information is available at the Canada Revenue Agency to help you assess your eligibility for the program.

Unfortunately, we can’t eliminate taxes. But, we can use wise business practices to minimize or defer income taxes that would otherwise be payable. These are only a few of the tax-planning opportunities available to you as a business owner. Talk to me about a complete tax check-up to help identify all the tax planning strategies available to you. After all, the tactics you employ today will help you reap rewards at tax time next year.

Lynne Protain, PFP, BAS, is a Consultant at Investors Group Financial Services Inc.Contact: 416-471-7400 Ext. 673 or email: lynne.protain@investorsgroup.com or LinkedIn: http://www.linkedin.com/pub/lynne-protain/22/961/185

http://www.linkedin.com/pub/lynne-protain/22/961/185

Lynne Protain

A loving and devoted mother, an entrepreneur and professional whose diverse international experience both personally and professionally provides a unique perspective to Financial Planning for business owners, families and individuals. A designated Personal Financial Planner with over 15 years experience helping families and business owners create and realize their financial dreams and goals. Lynne offers expertise and advice in areas of Debt Management, Tax Planning, Insurance and Risk Management, Investment Management, Business Succession Planning, Income Protection, Cash Management, Retirement Planning, Estate Planning and Education Planning. Lynne is also a member of the UFSC, an organization supporting educational advancement and economic empowerment for minority communities. She is also involved with Big Brothers Big Sisters of Toronto. Phone (416) 491-7400 ext. 673 Toll free (888) 491-7415 Email : lynne.protain@investorsgroup.com

How To Keep Your Business Relevant During the 2012 London Summer Olympics

Sandra Gabriel — Tue, 24 Jul 2012 14:07:16 +0000

In less than a few days, the 2012 London Summer Olympics will be dominating most, if not all the air waves: print and broadcast media, social networks and more and despite all the festivities, your business will still be going and most likely fade into the background. Perhaps you have some important company news or a product or event launch and it will only get lost in the Olympic shuffle. It’s probably better NOT to share anything too important during this time, but if you must, leverage will be your best friend. Here are some ways in which you can keep your business relevant and top-of-mind with your customers during the 2012 London Summer Olympics.

Leverage

Think about some ways in which your business, product or service relates to the Olympics. Can your news relate to any news in London, the history of the Olympics, the Olympians the history of the Olympians or former Olympians or the overall theme of the event? Perhaps one of the current or former Olympians is from your city which presents an opportunity for you to create an ‘in’ for your story. Visit the London 2012 website and start browsing for ideas.

Contribute

How can you help the media tell their stories on the Olympics? Can you be a source or provide stats and facts or is there some uncovered story that you can help them to break? Remember working with the media is not always about you. It is a mutually beneficial relationship that is about give and take. Find ways in which you can help contribute to their stories, then call and let them know your available for quotes or comments or interviews if need be.

Tell your “Olympian” Stories

Did you or someone in your company take part in track or any other sports? Using their story and tieing it in with the Olympics is another way in which you can keep your story and company relevant and top of mind with the media and your customers. In fact, if you can find a few former athletes, you can create your own company Olympic team. More on that below.

Create your own Olympic Team

Perhaps you have plans to celebrate the Olympics at the office as part of an internal communications initiative. Share that initiative with your social networks and get them involved with voting for the best Sales or Customer Service rep. Don’t be afraid to take your initiative externally too. Create a contest where the customer who sends the most referrals gets a ‘gold medal’ or some similar prize or recognition on your Facebook page or Twitter feed.

Create your own Olympics Coverage

If you have a place on your site or in your social networks (i.e. your twitter feed) where you can post regular updates about what’s going on at the Olympics, readers will check back often for updates and possibly come across any other company news that you might have posted. Twitter is doing something similar where they will be creating a page where all tweets on the Olympics will be curated. Click here to read more about how Twitter Embraces Olympics to Train for the Big Time.

Again, I would recommend that you hold on reporting anything too important over the next two weeks as it will most like get moved to the bottom of the everyone’s priority list, but if there is something you really need to announce, hopefully you can use some of the above suggestions to get people to pay attention.

Black Ink Magazine - The Canadian Black Professional and Business Community

Do you know how to use the Disability Tax Credit?

Lynne Protain

How To Keep Your Business Relevant During the 2012 London Summer Olympics

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