1. If the following expenditures are made by individuals by December 31, 2004 they will be eligible for 2004 tax deductions: moving expenses, child care expenses, safety deposit box fees, charitable donations, political contributions and medical expenses.
   
   
2. 2004 eligible Registered Retirement Savings Plan (RRSP) contribution amounts are noted on the 2003 personal income tax return assessment notices. You have until March 1, 2005 to make tax deductible RRSP contributions for the 2004 year.
   
   Consider contributing to a spousal RRSP to achieve income splitting in the future.
   
   
3. Persons turning age 69 in 2004 must mature their RRSP into cash, an annuity or a Registered Retirement Income Fund by December 31, 2004.
   
   
4. If you own a business, consider paying a reasonable salary to family members for their services rendered to the business.
   
   
5. An individual whose 2004 net income exceeds $59,790 will lose all, or part, of their old age security.
   
   Senior citizens will begin to lose their income tax age credit if net income exceeds $29,124.
   
   
6. Consider purchasing assets eligible for capital cost allowance before the year end. For example, employees may claim capital cost allowance on automobiles used in their employment. - Must have a T2200.
   
   
7. If you had taxable capital gains in the year, or any of the preceding three years, consider selling capital properties with an underlying capital loss prior to the year end. This capital loss may be offset against the capital gains.
   
   
8. If income in an inter vivos trust is to be taxed on a beneficiary's return, the income must be paid or payable to the beneficiary by December 31, 2004.
   
   
9. Registered Education Savings Plan (RESP)

   A Canada Education Savings Grant (CESG) for RESP contributions will be permitted equal to 20% of annual contributions for children (maximum $400 per child per year).

   The 20% is proposed to be increased to 40% or 30% for lower income families commencing January 1, 2005.
   

10. Health and dental premiums for the self-employed

    Individuals will be allowed to deduct amounts payable in respect of the year for Private Health Service Plan coverage in computing business income provided they meet certain criteria.

11. Taxpayer-Requested Adjustments

    Currently an individual may request an adjustment to a tax return back to 1985.

    It is proposed that after 2004, adjustments will be limited to ten years back. Therefore, adjustments for 1985 to 1995 should be requested by December 31, 2004.

(i)

(ii)
(iii)

1. Sign a Power of Attorney for management of property and personal care matters.
   
2. Avoid probate fees by naming beneficiaries to life insurance policies and pension plans, joint ownership and by multiple wills.
   
   Also, assets could be rolled over to an Alter Ego Trust or a Joint-Spousal or Common-Law Partner Trust.
   
3. A Will may be used to defer gains by transferring assets to a spouse or a Spousal Trust, to deem a charitable donation to have been made in the year of death, to establish a Testamentary Trust eligible for a separate year end and graduated tax rates, to provide for a windup of a holding company, and to gift publicly traded securities to a charity to take advantage of the 25% taxable capital gain.

By placing capital assets in a separate holding company, subsequent legal claims arising in the operating company may not affect these assets.

Paying tax-free dividends to a holding company may protect assets from future claims.

Shareholder loans may be secured by a general security arrangement to give the shareholder priority over all unsecured creditors.

Consider an estate freeze such that the future growth will go to other family members.

Transfer assets into a Discretionary Family Trust.

1. Small business deduction increased to $300,000 effective 2005 instead of 2006.
   
2. Non-capital loss carry-forwards was increased from 7 years to 10 years for taxation years ending after March 22nd, 2004. Existing losses continue to have 7 year carry-forwards.
   
3. The capital cost allowance (depreciation) rate for computers increased from 30% to 45% declining balance effective March 22nd, 2004.
   
4. All statutory fines and penalties now non- deductible after March 22nd, 2004.
   
5. Ontario Health premiums was introduced in 2004 and applies to individuals resident in Ontario on December 31st each year. Trusts and non-residents are exempt from the premium.