As the new year unfolds, it is time to pay off those holiday bills and do a little planning. The simplest way to organize your finances is to mark important financial dates on a calendar. All of us have specific dates we need to keep in mind that are unique to our lives, so we have organized some important ones to mark on your calendar that relate to individuals, families, business owners, investors, and pensioners.
- Most employers deposit paycheques directly into their employees’ bank account. This would be a natural date for you to mark on your calendar to check your bank account balance and do any applicable bill payments and transfers at that time. We encourage individuals to sign up for online banking and to automate as many of their household payments as possible, including credit card payments. Automation ensures payments are on time and avoid interest charges. Employees should make a note that this year February 29 is the regulatory date your employer is required to deliver or mail your T4 tax slip.
- The deadline for personal income tax returns this year is April 30. Self-employed individuals should pay any tax owing by April 30, but they have until June 15 to file a return. Canada Revenue Agency sends notices to individuals that are required to make installments on the following dates: March 17, June 16, September 15, and December 15. Pensioners should factor in the new income splitting rules when making installment payments in 2008 as well as any expected changes in income.
- Lower income individuals may be eligible for the GST credit payment and should note these approximate dates: January 4, April 4, July 4, and October 6. If you qualify for the income supplement you will be able to obtain a list of the dates these payments are made.
- Homeowners have two important dates to mark on their calendar -renewal of house insurance and annual property taxes. We encourage people to automate as many of the monthly utility payments and mortgage payments as possible. Disability, life, and health insurance should be noted. And don’t forget to include the dates your vehicle insurance is due, along with any other assets that you may insure.
- Parents of younger children may be receiving the Canada Child Tax Benefit and Universal Child Care Benefit. Generally, payments are made by the 20th of each month. By default payments are made by cheque but we encourage people to set these up for automatic deposit directly to your bank account. These cash inflows may allow you to fund two important and recommended cash outflows: a registered education savings plan and term life insurance. Both of these may be paid through a monthly pre-authorized payment on the last day of each month. Childcare and other related expenses should also be marked on your calendar.
- Business owners not only have to keep track of personal dates, but also those relating to their business. Corporate tax deadlines, installment payment due, GST remittances, provincial sales tax, payroll, tax slip remittances, and other applicable dates should be marked on a calendar. Each year the CRA website (www.cra-arc.gc.ca) posts key dates for both individuals and businesses. Missing these dates may result in penalties and/or interest charges. Many professionals have association dues that are payable either monthly or annually.
- Investors may want to make a note of a few important cutoff dates. This year, February 29 is the last day that you may make a contribution to your RRSP for the 2007 tax year. January 2 is the first day you may make a contribution to your RRSP for the 2008 tax year. Some individuals wait until they receive their 2007 Notice of Assessment to be certain of their actual 2008 RRSP contribution limit. CRA provides a buffer of $2,000 for individuals who prefer to estimate early.
- Investors who are saving monthly through pre-authorized contributions should mark these dates on their calendar (generally the last day of the month). People living off their investment income may request a monthly “expected income report” for 2008. This report outlines the dividend and interest payments for the upcoming year and when those amounts will be paid.
- Make a note of the maturity dates of your investments along with redemption rights and other important dates specific to your portfolio. Other dates that may be worth noting are when tax slips are required to be mailed. February 29 is the regulatory mailing date for T4A and T5 slips and March 31 is for T3 and T5013 slips. Investors who have cash or margin accounts should also be aware of the tax loss selling dates for Canada and the US each year in December.
- The Toronto Stock Exchange, New York Stock Exchange, American Stock Exchange and Nasdaq each have a website where they post the days in 2008 when they are closed for the holidays.
- Old Age Security (OAS) and Canada Pension Plan (CPP) payments should be set up to be automatically deposited into your bank account. The following are dates scheduled for automatic deposit for 2008: January 29, February 27, March 27, April 28, May 28, June 26, July 29, August 27, September 26, October 29, November 26, and December 22. Individuals receiving OAS, CPP, or EI may obtain their tax slips as early as February 1 online or by February 29 by regular mail. You should also mark those dates relating to a private pension, annuity payments, and scheduled RRIF payments. February 29 is the regulatory mailing date for T4RSP and T4RIF tax slips.
The above lists are not comprehensive and we advise you to confirm all dates that pertain to your specific needs. Once these dates are marked on a calendar you may find excesses some months and shortfalls in other months.
Mapping out your expected cash inflows and outflows early may provide you an opportunity to plan ahead and budget if necessary. The easiest way to supplement the above is to review your previous year’s bank, credit card, and investment statements.