Don’t wait until December—there’s paperwork involved, and you’ll want to ensure everything is in place, including making your final RRSP contribution. Also, consider a onetime over-contribution of up to $2,000 to your RRSP, which is allowed without incurring penalty taxes. Pro Tip: If you’re transitioning out of your practice and looking to retire, planning for your RRIF is a critical step to ensure your savings are properly structured to provide a steady income in retirement. And if your spouse is younger, continuing to contribute to a Spousal RRSP can provide additional tax savings. 5. Turn a loss into an advantage Like many professionals, you may have investments that haven’t performed well. Instead of holding on to them, consider selling these underperforming investments to trigger a capital loss. You can use these losses to offset any capital gains, whether they’re from the sale of your practice, equipment, or other investments. Here’s how it works: z The sale must settle by the end of the year. z Unused capital losses can be carried forward indefinitely, potentially offsetting gains in future years. z Be mindful of the superficial loss rule, which could void your loss if you repurchase the same asset within 30 days. Pro Tip: If you’re planning to sell part of your practice, equipment, or investments tied to your clinic, capital loss planning can be an important tool for minimizing taxes during transitions. 6. Donate shares to a charitable cause If you’re considering philanthropy as part of your legacy, donating appreciated shares of publicly traded securities to a registered charity can be a tax-efficient way to make a difference. When you donate shares, you won’t have to pay capital gains tax, and you’ll still receive a charitable donation tax credit, giving you double the benefit. Pro Tip: Many dental professionals feel a strong connection to their communities and might consider supporting charitable initiatives, whether by providing dental care for underserved populations or contributing to local programs. Donating appreciated securities not only helps a cause you care about but also provides significant tax relief. Final Thoughts: A Proactive Approach to Tax Planning Proactive tax planning is essential to maintaining financial health, especially for dentists balancing the demands of a busy practice with a multitude of other responsibilities. Navigating the complexities of tax regulations requires more than just basic knowledge—it demands a strategy that integrates both personal and business financial needs. CDSPI has partnered with MNP, one of Canada’s leading professional services firms, to offer tailored accounting and tax solutions. Whether you are just starting out, growing your practice, or planning for retirement, MNP’s network of specialized dental service professionals can help streamline your tax strategy while minimizing administrative burdens. By collaborating with experts who understand the specific challenges of the dental profession, you can ensure your financial health is as robust as your practice. CDSPI Investment Planning Advisors are all Certified Financial Planner® (CFP®) professionals who work exclusively with dental professionals to develop a comprehensive financial plan that identifies your goals and leverages expert financial, risk management, diversification and tax planning strategies to help you achieve financial success. Contact CDSPI Advisory Services Inc. at investment@cdspi.com or 1.800.561.9401 or book a complementary consultation online at cdspi.com. Created by dentists, and exclusively for members, CDSPI helps you achieve financial well-being with tailored advice, insurance, and investments. Access to CDSPI is a benefit of your membership with your provincial or territorial dental association. The information contained in this article is of a general nature only and should not be considered as personal investment or financial advice. For specific advice about your situation, please consult with your financial advisor. 31 Issue 6 | 2024 | SupportingYour Practice
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