Top Tips for Reducing Estate Taxes in Canada - dummies

By Margaret Kerr, JoAnn Kurtz

Part of Wills & Estate Planning For Canadians For Dummies Cheat Sheet

Though Canada doesn’t have any “death taxes,” taxes on your estate, including your Registered Retirement Savings Plans (RRSPs) and Registered Retirement Income Funds (RRIFs), can really add up. With a good estate plan you can keep those taxes at a minimum.

Follow these helpful tips and you’ll keep the Canada Revenue Agency (CRA) from being your biggest and happiest beneficiary!

  • Leave capital property that has gone up a lot in value to your spouse.

  • Name your spouse as beneficiary of your RRSPs and RRIFs.

  • Leave your children or grandchildren cash or property that has not gone up a lot in value.

  • Use the principal residence exemption to leave your vacation property to your children without triggering a capital gain.

  • Give away capital property while you’re still alive if you have a capital loss to offset any capital gain

  • Donate money to charity in your will.

  • Make sure your will gives your executor power to use your unused RRSP contributions to make a contribution to your spouse’s RRSP.

  • Give your executor enough information to make use of any unused capital losses when you die.