Canadians often look to financial advisors for help in increasing their wealth and passive income, but new information from CIBC shows that they may be missing out on chances to reduce a major expense.
“Too many Canadians put off thinking about their taxes until the new year, and by then it might be too late,” said Jamie Golombek, managing director of tax and estate planning for Wealth Strategies Group, CIBC.
His observation comes on the heels of a new CIBC poll of Canadians that shows 77% of Canadians don’t even think about their taxes until Dec. 31, the date on which many tax-planning opportunities will expire. Furthermore, two-thirds of Canadians report not knowing any year-end benefits or strategies to help them reduce their tax spending and save on their 2016 tax return.
“The most effective tax planning occurs throughout the year,” said Golombek. “Chances are that you're leaving money on the table if you don't know what tax credits and benefits are available to you, or if you miss the year-end deadline for some of them.”
This isn’t the first study suggesting a deficiency in financial planning among Canadians. A recent global ranking of countries had Canada scoring decently in terms of overall financial literacy, but only 58% of the Canadian respondents in the poll said that they set long-term financial goals.
“December 31 is the quiet deadline that many may miss in the holiday rush,” Golombek said, adding that Canadians may want to speak with their advisor as early as now to consult on possible ways to reduce their 2016 tax bill.
How do Canadians rank on financial literacy?
Research shows average Canadian family tax spend of $30k + last year