Even with Canada’s provincial healthcare plans, medical expenses can add up quickly. This is because the number of expenses not covered by these plans is constantly increasing.
If you are lucky enough to have a private plan through your employer, these costs may be reduced, but for many, there is no way around partially or fully paying for unavoidable medical expenses including, but not limited to:
In the previous blog, we looked at the all important task of obtaining travel medical insurance before you travel. Now, let’s look at access to funds and residency.
Access to Funds
On a very practical level, such snowbirds need to think about how they will access funds needed to live out of the country for an extended period. Many snowbir
ds are eligible to receive monthly payments from both the Canada Pension Plan (CPP)and the Old Age Security (OAS). Fortunately, it’s relatively easy to arrange for payment of both while down south, as payments of both CPP and OAS benefits can be made by direct deposit to an account at a US bank where the Canadian recipient is located. Funds deposited in this way are converted to US dollars prior to deposit, and the exchange rate used by the Canadian government will typically be better than most which can be obtained locally.
As the days shorten and temperatures drop into the single digits, the thoughts of many Canadians turn to the idea of spending at least some part of the upcoming Canadian winter somewhere much warmer — most often, in one of the southern US states. And, while the less than robust state of the Canadian dollar relative to US currency has required Canadians to downsize some of those plans, it is still the case that thousands of Canadian “snowbirds” fly south during the worst of the Canadian winter.
Wherever they are going, and however long they are staying, it’s safe to say that the thoughts of those snowbirds are on enjoying the warm weather and the sunshine, and that the potential financial consequences or income tax issues raised by their trip down south are not top-of-mind.
Apart from Registered Retirement Savings Plan (RRSP) contributions made by individuals, tax planning strategies for 2017 must be completed by the end of the year. With December 31st fast approaching, there are only a few weeks left to take last minute steps towards reducing your 2017 tax bill. Luckily, there are a number of uncomplicated tax planning strategies that can be implemented in this short period of time.
Just about any financial or investment transaction can now be carried out online, and many Canadians conduct most or all of their financial affairs in an online environment, whether through their financial institution’s web-based banking and investment services or by using mobile apps.
The shift to managing one’s financial matters online has extended to dealing with income tax matters, and that’s a trend which has been both aided and encouraged by the Canada Revenue Agency (CRA).
The CRA’s most notable success in encouraging Canadians into the online tax world has been in relation to the filing of the annual tax return. Motivated, perhaps, by the prospect of quicker processing turnaround and faster receipt of tax refunds, Canadians have taken to online filing of returns in droves. For the latest filing year, 2016, over 24 million individual income tax returns (or 86% of total returns filed) were filed using electronic methods.
It has been nearly a decade now since the mortgage lending debacle in the United States caused a meltdown in real estate markets, which led in turn to a general crisis in the financial markets and eventually to the Great Recession of 2008-2009.
While no country was immune from the effects of that economic downturn, Canada did not experience the broad-based mortgage lending and real estate crash which occurred in the U.S. There were a number of reasons for that, but chief among them was likely the different regulatory environment of our banking system and in our mortgage lending practices.
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