[INFOGRAPHIC] 2016 Canadian Federal Budget Analysis and How it Affects Insurance
(Scroll down for infographic)
The Honourable Bill Morneau, Minister of Finance, recently announced the federal budget for Canada for 2016. We’ve put together an infographic to outline the highlights of the federal budget and what it means for families, retirees and business owners.
This infographic explains how the federal budget affects families, retirees and business owners and how the budget has targeted the transfer of personally owned life insurance policies to corporations. Prior to the budget changes, business owners were able to transfer personal policies to their business and receive the proceeds on a tax free basis (FMV-CSV) and at death also receive the full CDA Credit , with the budget, the changes no longer allow this.
Some of the more important topics discussed include:
- Old Age Security benefit changes
- Canada Child Benefit changes
- Changes to income splitting for families
- Education and School Supply tax credit
- School Supply tax credits
- Changes to taxation of mutual funds
- Repeal of the Children’s Fitness and Arts Tax Credit
- Changes to taxation of Linked Notes
- Changes to the small business tax rate
- Changes to the treatment of Life Insurance Policies
- Changes to the transfer of Life Insurance Policies
We’ve compiled some additional resources and opinion pieces from our partners. You can link to them or download these PDFs for a more in-depth analysis from different viewpoints.
Insurance Journal: http://insurance-journal.ca/article/insurance-transfer-tax-planning-loophole-now-closed/ (Article)
Financial Horizons – Expanded Horizons: http://www.safepacific.com/images/blog/Expanded-Horizons-Federal-Budget-2016.pdf (PDF)
BMO Insurance: http://www.safepacific.com/images/blog/BMO-federal-budget-2016-analysis.pdf (PDF)