The benefits of generosity are greater than you think.
When you think of being generous, initially you may think the benefits of giving are for the recipient. While this is true, the benefits can be significant for the giver as well. Research has demonstrated the following benefits for the giver.
Studies have found that people who are generous are healthier
Remarkably, studies also found that people who are generous have lower activity in their amygdala. A highly active amygdala results in higher anxiety.
Studies have found that regular, small acts of generosity towards others results in healthier relationships.
Those who are generous financially receive significant tax deductions in Canada. After the first $200 of donations in a year, you receive a reduction off your income at the highest marginal tax rate even if you aren’t in the highest tax bracket.
The Canadian government also lets you donate shares of publicly traded companies in kind to a charity. When doing this, you get the donation credit for the full amount of shares at the time of donation and you don’t pay tax on the capital gain of the shares donated. Double bonus.
The government recognizes the incredible benefit charitable organizations bring to society through tax breaks for donations that are better than any other tax incentive.
They say to save the best for last, right? Studies have found that people who are generous seem to live longer than those who are not.
It is important to clarify that generosity doesn’t have to be being generous financially. It can be serving others or volunteering for a cause important to you.
Be Generous! It’s good for others and it’s good for you!
References:
https://www.medicalnewstoday.com/articles/322940?c=1101852366524
https://www.huffpost.com/entry/generosity-health_n_4323727
https://health.clevelandclinic.org/why-giving-is-good-for-your-health/
Connect Wealth is an independent financial planning firm that offers holistic advice to clients based on their current goals and future aspirations. We use well-established workflows and cutting edge technology to maximize planning efficiencies while simplifying the process for clients. Learn how you can maximize your financial opportunities at www.connectwealth.ca
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The income sprinkling rules outlined in July 2017 held strong and the rules pertaining to passive investment income weren’t as harsh as predicted. Specifically, Budget 2018 has implemented two simple measures as it pertains to passive investment income:
Budget 2018 proposed to provide for an alternative reduction to the small business tax rate where a Canadian Controlled Private Corporation (CCPC) and its associated corporations have investment income in the year exceeding $50,000. The amount of the reduction is $5 for every $1 of investment income exceeding $50,000. In effect, the small business tax rate reduction disappears if passive income in a related business exceeds $150,000 in a fiscal year.
Currently, private corporations are entitled to claim a tax refund equal to $38.33 for every $100 of taxable dividend Where the corporation has a combination of regular business income (taxed at the regular business rate which does not include a refundable tax element) and investment income (taxed at the corporate investment rate which includes a refundable tax component), planning was commonly implemented to have the business income distributed by way of eligible dividend (taxed at a lower rate) while still being able to claim the tax refund.Budget 2018 proposes to modify the refundable tax regime to eliminate this planning and ensure that, in general, the private corporation is entitled to a dividend refund only when non-eligible dividends are paid.
There are ways to reduce the impact the business tax changes outlined within Budget 2018 through other financial strategies. These strategies may include Individual Pension Plans, Cash Value Insurance, as well as the strategic use of prescribed loans. We highly recommend contacting your financial advisor to determine which of these strategies will best suit your financial situation.
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If you have any questions on this taxes, or the different kind of impact it could have on you, please, do not hesitate to contact us!
Connect Wealth is an independent financial planning firm that offers holistic advice to clients based on their current goals and future aspirations. We use well-established workflows and cutting edge technology to maximize financial efficiencies while simplifying the process for clients. Learn how you can maximize your financial opportunities at connectwealthp.wpengine.com
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