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How can you help customers reduce their taxes?

“We find they are of little use, but they become an extremely important tool in retirement, especially if you need to take out a large lump sum or something comes along,” she said. “If you’re taking this out of your RRSP, you don’t want them to have a huge tax.

“We are moving away from requiring that RSP contribution to help with their income tax. We are starting to look at ways to keep their withdrawals under control,” she said, adding that consultants should figure out which combination of their Works best for the long term interest of the customer.

Every Canadian citizen who is 18 years of age and older can put $6,000 in their tax-free savings account this year. It may have accumulated, so they now have a total of $81,500 in their TFSA account. Then, Eazy said, advisors can work with them to decide how much to invest safely or aggressively.

“That money is now placed in such a way that, if you need access to it, it’s not going to contribute to your taxable income,” she said.

Clients must also name a beneficiary, and there is no probate or tax on TFSAs, as for RRSPs for client assets. But, Eazy said advisors should ensure that clients do not go over the limit as the monthly penalty is 1% if they do.

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