Dale Jackson

Personal Finance Columnist, Payback Time

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Here’s hoping 2019 will be a better year for investors than 2018. The new year is expected to bring its fair share of unpredictability, but there are three key dates that could bring opportunity. 

Jan. 1: Ottawa has set the 2019 tax-free savings account (TFSA) contribution limit at $6,000. That’s more than the usual $5,500 annual limit because it has been adjusted for inflation. If you were at least 18 years old when the TFSA was launched in 2009, the total accumulated contribution limit is $63,500. If you turned 18 over the past 10 years, contribution limits add up from that year forward.

Any investment gains in a TFSA are tax-exempt. Your total limit may vary depending on withdrawals and contributions over the years. You can find out from the source through your individual account with the Canada Revenue Agency (CRA).     

March 1: If you want to lower your 2018 tax bill through a registered retirement savings plan (RRSP) you must make your contribution before midnight, March 1. The limit is 18 per cent of the previous year’s income up to a maximum of $26,230, but any unused contributions from previous years can be used in future years (including 2019).

RRSP contributions can be deducted from taxable income and grow tax free through investments until they are fully taxed in retirement. Higher-income Canadians tend to get more bang for their RRSP buck because they are in higher tax brackets.  

April 30: It may seem like a long way off but the deadline to file your 2018 income tax is April 30. It might be a good idea to gather and isolate relevant receipts and documents this week before they get mixed up with 2019 receipts and documents. Employers are required to send T4 slips with most of the tax information needed to file by March 1.

A good tax plan will leave more of your tax dollars to compound as investments.