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(December 4, 2008) Despite numerous warnings and audit actions, the Canada Revenue Agency says taxpayers are still participating in tax shelter gifting schemes. The agency has already denied $2.5 billion in claimed donations, and it’s vowing to audit all tax shelter gifting arrangements going forward.

Currently over 65,000 taxpayers who participated in these schemes have been reassessed, or are in the process of being reassessed, according to the CRA. In most cases, the agency says it has denied the “gift” completely.

Further, the CRA is warning taxpayers that if they participated in a tax shelter gifting arrangement in 2007 and claimed “donation” on the tax return, the claim may have been accepted as filed; however, this does not mean the CRA agrees with the donation claim. It’s urging those taxpayers to keep their books and records in case it has to review the 2007 return.

It generally takes three years from the date of assessment to audit and reassess taxpayers, the CRA says. These audits can take over a year to complete.

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Canadians think about legacy planning: Survey

(December 4, 2008) The cracking of the retirement nest egg, courtesy of recent market movements, hasn’t put a damper on good intentions. Nearly half of Canadians 55 and older have thought about leaving a life legacy as a way to affect positive change, according to a new poll by Investors Group.

“Approaching the retirement years is a main trigger point for planning to leave a legacy and give back to the community,” said Richard Irish, vice-president, community affairs, Investors Group. “Canadians of all ages have core values of generosity and a willingness to help others — in fact, according to Statistics Canada, 85% of people over the age of 15 give a financial donation to a charity or other non-profit organization. The next logical step involves planning for the future to ensure that their legacy comes true.”

IG says estimates of intergenerational wealth transfers over the next 20 years have ranged as high as $1 trillion. The survey suggests 68% of Canadians plan to leave their estate to family members.

Canadians also intend to leave a substantial amount of wealth to charity. Their contributions to non-profit organizations will average about 28% of their financial assets according to the IG poll, regardless of age. Among Canadians 55 and older, 42% said they plan to donate up to one-tenth of their financial assets, while another 49% said they would donate between one-tenth and one-half of their wealth.

“Planned giving is an important part of financial and estate planning, as well as a great way to help important organizations and their work,” Irish says. “Charities have lots of room for growth in the estate planning of the nation and the potential rewards have never been greater.”

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Advocis elects new board of directors

(December 4, 2008) Advocis has announced the new slate of directors for their board who were elected at their annual general meeting held in Toronto on Monday, December 1.

Most notable is the election of Kristan K. Birchard, CFP, CLU, CH.F.C., who will be the new chair of the Advocis board for 2008-2009.

“It is a tremendous honour to be asked to lead this group of experienced and committed volunteers,” Birchard says. “We are entering into an interesting time in the evolution of this organization. I know that 2009 will be a year that is full of promise and excitement.”

Birchard has been a member of Advocis for more than 30 years. He has served on the Ottawa chapter executive and as chair of the CLU Institute’s board of directors. Last year, he was vice-chair of the board of directors of Advocis. He is a charter member of the Conference for Advanced Life Underwriting (CALU) and a Century Initiative member.

(12/04/08)