How would you like to save money this holiday season?

By Mark Bull, MFA-P, CLU, CFP, CHS, CEA
President, Bull Financial

November and December are a very busy time of year for everyone.  There is the mad rush of holiday parties, shopping, family obligations and travel planning, all of which are opportunities to spend lots of money.  But what about the opportunities you have to save lots of money?

Yes, ‘tis the season for year-end tax planning that could more than offset your holiday expenses – and support your holiday giving.

Here are some opportunities you should be considering.  This is a high-level look at things; if you’d like to learn more, just let us know. And please be sure to read #6, a very important message about a change in the tax treatment of certain charitable gifts!

You can also download the PDF below for a summary of these opportunities.

Year End Planning

1. Capital loss selling

If you happen to own a stock that is trading at a loss in a non-registered account or cash investment account, you can sell it – triggering the loss and reducing capital gains you have accrued in the past three years.

2. Tax credits for gifted shares

On a similar note, look at the capital gains you have accrued in non-registered accounts. Consider gifting those shares to your favourite charity, which gives you a tax credit for the gifted amount as well as bypassing capital gains tax.

If the shares in question reside in a corporate account, your gift will also generate a credit to your capital dividend account (CDA) in an amount equal to the capital gain. 

3. The First Home Savings Account (FHSA)

Announced in the 2022 federal budget, an FHSA is a tax-free savings account that combines the tax advantages of the RRSP and the TFSA and is designed to help future homeowners save for the purchase of a qualifying first home in Canada.

There is a compelling reason to open an FHSA before year-end:  you can carry forward your unused contribution room. You can contribute up to $8000 each year, so, if you open the account by December 31st and do not actually make a contribution this year, you can contribute up to $16000 next year; all contributions are tax-deductible.


If you turn age 71 this year, you are required to convert your RRSP to a RIF (Retirement Income Fund) by December 31st.

5. Charitable giving

Consider making charitable gifts before year-end, so you receive a tax receipt for 2023 tax purposes.

6. ***A very important note about charitable giving***

Effective January 1st, 2024, our federal government will change the Alternative Minimum Tax (AMT) on personal giving, a surprising move that will be punitive to donors and charities from coast to coast.  The current AMT rules allow a donor to give, to charity, publicly-traded shares that have incurred capital gains – without attracting tax on those capital gains.  In addition, the donor receives a tax credit for 100% of the donated shares.

However, under changes introduced in the federal government’s most recent budget, 30% of the gain arising from the donation of shares will be taxable, and the donation tax credit will be reduced to 50%.

It is important to note that the new AMT rules do not apply in the year of a taxpayer’s death, so charitable donations can still be used to eliminate estate taxes owing. As well, the AMT change does not apply to corporations, so business owners can continue to donate shares corporately or consider starting to do so.

Time is of the essence.  December 31st of this year will be the last day to donate under the current tax rules.  There are a number of strategies that can be employed.  We will always be happy to hear from you.

You can also download the PDF below for a summary of these opportunities.

Year End Planning

Mark Bull, MFA-P, CLU, CFP, CHS, CEA
President, Bull Financial

This is a general guide only and is not intended to replace professional financial and tax advice in any form. Please consult a professional financial advisor on how it relates to your situation. The information provided here is accurate as of the date of publication.

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