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| Financial |
 Death
& TaxesBy Debbie Patterson, owner of Odessey Business Services There are only two certainties in life - death and taxes... We’ve all heard it said before; by our parents, or a boss, and I’m sure it’s left our mouths a few times too... But have we really heard it? They may be certainties, but that doesn’t necessarily mean we can’t implement controls over how they affect our lives. We’ve talked about taxes before, but death seems to be an unmentionable. Just as we have a financial or business plan, we can have a plan for the uncertainties in life too. They all tie together, and with general upkeep we can be sure that our company, family, and legacy continues with few disruptions and upheavals as possible during times that are stressful enough. Knowing your options and the rights you can exercise are the first steps in a well rounded life plan. Implementing them is the next. Personal Protection: •Create a tax plan with regular updating due to changes in family, employment, health and lifestyle. This would include a budget, and future considerations for retirement for not only you personally, but also for a spouse and children. RRSP’s, RESP’s, CPP contributions, stocks, mutual funds, shares, etc., all contribute to a portfolio that, with proper management, is an important part of retirement. •Have a personal extended health plan. Whether you get coverage through an employer, need to increase your current coverage, or are self-employed and have no personal health coverage, an extended health plan is not missed until it’s needed. •Complete a will, living will, Power of Attorney and an Executor of Estate. A will should be updated regularly due to changes in family structure, for example, the death of a beneficiary, or the addition of a child or spouse. The most important part of a will is where to place the custody of your children should something happen to you. It is a horrible thought and is the reason many couples don’t complete a will package, but too late is too late. A living will is an essential piece of legal paperwork that can prevent much family heartbreak as well as make sure that your wishes are followed when your health has deteriorated to a point of non-communication such as Alzheimers, etc. Power of Attorney gives someone that you know the authority to control your estate once you can no longer manage it. Bills and cheques still need to be paid and deposited, family needs taken care of, and assets protected. The Executor of Estate is someone that you name in your will to manage your estate after you have passed. •Make a detailed inventory of assets for insurance purposes. Events such as fire, flood or burglary may seem like they will never happen, but being prepared will cut down considerable time when dealing with the red tape of insurance agencies. Ensure that you don’t forget a family heirloom that if damaged or missing would lead to heartache. Get a safety deposit box or fireproof safe to put such things as the inventory list, will and other documents such as deeds to land, and valuable possessions. Protecting Your Business •If you aren’t incorporated, look at the pros and cons of incorporating before doing it. The rules are different for an incorporated company and for a small business that has always run as a proprietorship - there may some relearning in the running of the business. •A limited company provides some liability and that is why many choose to do it. But there are some issues that still affect the directors. Any outstanding amounts owed to the government, such as WCB, payroll deductions, GST and corporate tax, fall back on the directors of the corporation for collection. •Some personal health plans can be written off in the company. This may help in the decision to get an extended health plan for both your family and your key employees. •If something were to happen to you, do you have someone who can notify your clients to let them know where their project stands, pay the bills, deposit cheques, or organize your staff? Giving someone Power of Attorney for your company is very important and is rarely a thought, again until it is too late. •Make regular backups of electronic data, as well as have a secure backup in a firebox or safety deposit box. It is not necessary in this day and age to lose weeks or months of data with the technology we have available. •Regulary update company shareholder information. Debbie Patterson is the owner operator of Odessey Business Services, specializing in income tax. Visit her at www.odesseybusiness.com for more tax tips or contact her directly at 403.816.5098 |