Canada's investment industry pushes for more details on planned tax-free savings accounts for first-time home buyers - The Globe and Mail | Canada News Media
The investment industry is seeking more details from the Canada Revenue Agency and the Department of Finance on the proposed tax-free savings account for first-time home buyers introduced in the federal budget this year.
The federal government has not yet published any draft legislation for the new savings program, known as a first home savings account, or FHSA. But it is expected to become available some time in 2023 – leaving the investment community with a “pretty aggressive timeline” to develop a product they know very little about operationally, said Robert Offen, manager of specialized services at AGF Investments Inc.
Mr. Offen, who was speaking at the annual Investment Funds Institute of Canada (IFIC) conference in Toronto, said IFIC – which represents more than 150 investment companies – first met with the CRA and the Finance Department immediately after the budget was released in April.
After that meeting, the group – along with the Canadian Bankers Association, the Canadian Life and Health Insurance Association Inc. and the Investment Industry Association of Canada – sent 11 pages of questions to the government.
The questions sought to clarify the requirements for eligibility, qualified withdrawals, plan termination, tax reporting and the filing process. They also requested information on the process around overcontribution, what happens in the event of the death of the holder and beneficiaries or if a holder becomes a non-resident, as well as the day-to-day administration of the new program.
Mr. Offen said draft legislation is expected by the end of July, followed by a 60-day period for industry comment. A second draft will be submitted around the end of October, which means royal assent would most likely not occur until the end of December.
“If we are looking to launch in 2023, and do the first filing by 2024, our timeline is pretty aggressive,” Mr. Offen told an in-person and virtual audience Monday.
When asked whether the group would meet again with the Finance Department, he confirmed that a second consultation will occur in the “second half of the year,” when the group knows “a bit more” about the product they have to build.
As outlined in the budget, the FHSA would allow any Canadian 18 or older to save as much as $40,000 – with an annual contribution limit of $8,000 – for their first home purchase. The new account is expected to combine the two major tax advantages of registered retirement savings plans and tax-free savings accounts. Similar to an RRSP, deposits would be tax deductible, while eligible withdrawals would be tax-free, as with a TFSA. Any investment growth would also be tax-free.
For investors – and potential home buyers – the accounts will provide another savings tool to help cope with a booming real estate market that has pushed out some first-time buyers in certain regions.
But for the investment community – particularly asset managers who will have to develop the product – the combination of TFSA and RRSP accounts adds layers of complexity to the process operationally, Mr. Offen said, and that needs to be clarified before any financial company can launch proprietary products.
During a panel discussion at Monday’s conference, IFIC senior policy adviser for taxation Josée Baillargeon said that both the CRA and the Finance Department have been open to talks with the investment community, and the associations are “hopeful” their list of questions will ensure that the next consultation will produce a lot more information.
“At the moment there is just very limited information … only 621 words, to be exact, that was written in the tax measure to explain this,” Ms. Baillargeon said. “There’s a lot more unknown than known at this point.”
With a file from Erica Alini
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TORONTO – Canada’s main stock index was up more than 250 points in late-morning trading, led by strength in the base metal and technology sectors, while U.S. stock markets also charged higher.
The S&P/TSX composite index was up 254.62 points at 23,847.22.
In New York, the Dow Jones industrial average was up 432.77 points at 41,935.87. The S&P 500 index was up 96.38 points at 5,714.64, while the Nasdaq composite was up 486.12 points at 18,059.42.
The Canadian dollar traded for 73.68 cents US compared with 73.58 cents US on Thursday.
The November crude oil contract was up 89 cents at US$70.77 per barrel and the October natural gas contract was down a penny at US2.27 per mmBTU.
The December gold contract was up US$9.40 at US$2,608.00 an ounce and the December copper contract was up four cents at US$4.33 a pound.
This report by The Canadian Press was first published Sept. 19, 2024.
Losing a loved one is never easy, and the legal steps that follow can add even more stress to an already difficult time.
For years, families in Vancouver (and Canada in general) have struggled with a complex probate process—filled with paperwork and legal challenges.
Thankfully, recent changes to Canada’s probate laws aim to make this process simpler and easier to navigate.
Let’s unearth how these updates can simplify the process for you and your family.
What is probate?
Probate might sound complicated, but it’s simply the legal process of settling someone’s estate after death.
Here’s how it works.
Validating the will. The court checks if the will is legal and valid.
Appointing an executor. If named in the will, the executor manages the estate. If not, the court appoints someone.
Settling debts and taxes. The executor (and you) pays debts and taxes before anything can be given.
Distributing the estate. Once everything is settled, the executor distributes the remaining assets according to the will or legal rules.
Probate ensures everything is done by the book, giving you peace of mind during a difficult time.
Recent Changes in Canadian Probate Laws
Several updates to probate law in the country are making the process smoother for you and your family.
Here’s a closer look at the fundamental changes that are making a real difference.
1) Virtual witnessing of wills
Now permanent in many provinces, including British Columbia, wills can be signed and witnessed remotely through video calls.
Such a change makes estate planning more accessible, especially for those in remote areas or with limited mobility.
2) Simplified process for small estates
Smaller estates, like those under 25,000 CAD in BC, now have a faster, simplified probate process.
Fewer forms and legal steps mean less hassle for families handling modest estates.
3) Substantial compliance for wills
Courts can now approve wills with minor errors if they reflect the person’s true intentions.
This update prevents unnecessary legal challenges and ensures the deceased’s wishes are respected.
These changes help make probate less stressful and more efficient for you and other families across Canada.
The Probate Process and You: The Role of a Probate Lawyer
(Image: Freepik.com)
Working with a probate lawyer in Vancouver can significantly simplify the probate process, especially given the city’s complex legal landscape.
Here’s how they can help.
Navigating the legal process
Probate lawyers ensure all legal steps are followed, preventing costly mistakes and ensuring the estate is managed properly.
Handling paperwork and deadlines
They manage all the paperwork and court deadlines, taking the burden off of you during this difficult time.
Resolving disputes
If conflicts arise, probate lawyers resolve them, avoiding legal battles.
Providing you peace of mind
With a probate lawyer’s expertise, you can trust that the estate is being handled efficiently and according to the law.
With a skilled probate lawyer, you can ensure the entire process is smooth and stress-free.
Why These Changes Matter
The updates to probate law make a big difference for Canadian families. Here’s why.
Less stress for you. Simplified processes mean you can focus on grieving, not paperwork.
Faster estate settlements. Estates are settled more quickly, so beneficiaries don’t face long delays.
Fewer disputes. Courts can now honor will with minor errors, reducing family conflicts.
Accessible for everyone. Virtual witnessing and easier rules for small estates make probate more accessible for everyone, no matter where you live.
With these changes, probate becomes smoother and more manageable for you and your family.
How to Prepare for the Probate Process
Even with the recent changes, being prepared makes probate smoother. Here are a few steps to help you prepare.
Create a will. Ensure a valid will is in place to avoid complications.
Choose an executor. Pick someone responsible for managing the estate and discuss their role with them.
Organize documents. Keep key financial and legal documents in one place for easy access.
Talk to your family. Have open conversations with your family to prevent future misunderstandings.
Get legal advice. Consult with a probate lawyer to ensure everything is legally sound and up-to-date.
These simple steps make the probate process easier for everyone involved.
Wrapping Up: Making Probate Easier in Vancouver
Recent updates in probate law are simplifying the process for families, from virtual witnessing to easier estate rules. These reforms are designed to ease the burden, helping you focus on what matters—grieving and respecting your dead loved ones’ final wishes.
Despite these changes, it’s best to consult a probate lawyer to ensure you can manage everything properly. Remember, they’re here to help you during this difficult time.
TORONTO – Canada’s main stock index was higher in late-morning trading, helped by strength in energy stocks, while U.S. stock markets also moved up.
The S&P/TSX composite index was up 34.91 points at 23,736.98.
In New York, the Dow Jones industrial average was up 178.05 points at 41,800.13. The S&P 500 index was up 28.38 points at 5,661.47, while the Nasdaq composite was up 133.17 points at 17,725.30.
The Canadian dollar traded for 73.56 cents US compared with 73.57 cents US on Monday.
The November crude oil contract was up 68 cents at US$69.70 per barrel and the October natural gas contract was up three cents at US$2.40 per mmBTU.
The December gold contract was down US$7.80 at US$2,601.10 an ounce and the December copper contract was up a penny at US$4.28 a pound.
This report by The Canadian Press was first published Sept. 17, 2024.
