The following checklist provides tactics you should consider as part of your year-end tax planning. If you need further explanation, please contact Chaplin & Co., Chartered Accountants at 416 667 7060.

Income splitting
- If you have excess cash to invest and a lower-tax bracket spouse or children, consider an income-splitting plan by lending money to a family member to take advantage of the low prescribed interest rates (1% to December 31, 2011)
- Deposit child tax benefits payments into a bank account in the name of your child so that income earned thereon is taxed in the child’s hands.
Registered Education Savings Plan (RESP) - Contribute to an RESP for your child. You are allowed to contribute up to $4,000 each year for each college or university student. You are not able to carry-forward unused contributions.
Consider giving investments to a child - Consider transferring investments to a child where that investment has dropped in value. This will trigger a capital loss that parent can use and any future growth will be taxed in the child’s name. Capital gains are not attributed to the parent.
Personal residence - For each personal residence owned by our family that was acquired before 1982, consider
- the need to establish the value of the residence at December 31, 1981; and
- the need for separate rather than joint ownership.
- where more than one residence is owned by a family, the personal residence designation should generally be used for the property with the largest gain per year. However, the timing of the tax liability must also be considered.
Childcare expenses -
- Pay childcare expenses for 2011 before December 31, 2011 and get a receipt.
- Boarding school and camp fees qualify for the child care deduction (subject to certain limits) as does the cost to advertise or use a placement agency to find a child care provider.
Employment leave by spouse - If your spouse is leaving the workforce, time contributions and withdrawals from a spousal RRSP to provide your family with extra disposable income.
Contribute to a spousal RRSP - Review each spouse’s RRSP and make RRSP contributions designed to equalize RRSPs so that each spouse will have the same retirement income
Separation agreements -
- Review terms to ensure that you will be entitled to the maximum deduction or the minimum income inclusion.
- Segregate child support component from alimony. Otherwise, the entire amount will be considered child support and will not be deductible.
Alimony payments - Ensure that all alimony or maintenance payments for the year are made by December 31.
RRSPs
- contribute by deadline of first 60 days of year to be able to claim deduction in previous tax year.
- to maximize your 2012 RRSP contribution of $22,970, your earned income must be at least $127,611 in 2011.
Children abroad - Consider whether your will and estate plan need to be updated for children who no longer reside in Canada.
Children under 6 - Ensure that you made the claim for the Universal Child Care Benefit of $100 per month.
Children’s Fitness Tax Credit - A non-refundable credit based on up to $500 of eligible fees for physical-activity-programmes.
Children’s Arts Tax Credit - A non-refundable credit based on up to $500 of eligible fees for artistic, cultural, recreational or developmental activity
Child Tax Benefit - Ensure claims are made for the child disability benefit if eligible.