FRIDAY, MAY 10, 2013 | WWW.PGCITIZEN.CA Money 23 A few ideas for an income tax windfall f you are expecting to receive an income tax refund from the CRA or have recently received it, reward yourself. Have some fun, but put some aside for one of these other ideas as well: Your greatest financial treasure by far Your most valuable asset is your ability to earn an income. You might spend over $1400 a year insuring each vehicle worth say $30,000. Yet your future earning years are probably worth millions to you and your family. Insure this with all you can muster. Don’t rely on company plans without a careful study of their limitations, many of which significantly reduce your income if you are unable to work for an extended period. Education savings If you plan to help your children or grandchildren with their education costs, you may wish to use your income tax refund to contribute to a Registered Education Savings Plan. The first $2,500 of RESP contributions attracts a government grant of $500 - $600 depending on your family income. If you have not opened an RESP for your children, the receipt of the CRA refund cheque can be a great way to start making contributions. Reduce non-deductible debt Consider paying down nondeductible debt subject to a high interest rate. Non-deductible debt includes credit card debt, a personal use car loan, and a line of credit used for personal purposes or the mortgage on your home. As the interest on a loan used for personal purposes is not deductible for income tax purposes, you are paying the interest on the loan with after-tax dollars. The higher the interest rate on the loan or the higher your marginal tax rate, the more income you have to earn to pay the interest on this loan, so the more beneficial it is to pay down this debt. RRSP or non-registered savings If you do not have high interest non-deductible debt, then another option for your income tax refund MARK RYAN is to save your refund in an RRSP or a non-RRSP account. In deciding whether you should save your refund in an RRSP or non-RRSP the following general observations can be noted: If your marginal tax rate in retirement is expected to be the same or lower than your marginal tax rate today, then consider contributing to your RRSP; If you are seeking to invest in securities that produce Canadian source dividends and capital gains and are in a low tax bracket today but expect to be in a higher tax bracket in retirement, you are generally better off to save outside an RRSP. Contribute to a Tax-Free Savings Account (TFSA) The TFSA provides a further option for investing your tax refund. The TFSA allows you to make a $5,500 (indexed to inflation) annual maximum contribution. If you haven’t opened one yet, you can do so for an accumulated total of $25,500. All growth, income and withdrawals are tax-free. You are also able to gift money to your spouse to invest in a TFSA without being caught by the income attribution rules. You may be wondering if it is better to invest your tax refund in an RRSP or a TFSA if you are unable to do both; the following general guidelines can help you make the decision. Choose the TFSA if your expected marginal tax rate in retirement is going to be higher than your marginal tax rate today. You generally can’t go wrong by paying down an outstanding nondeductible debt subject to a high interest rate. Choose the RRSP if your expected marginal tax rate in retirement is going to be lower than your marginal tax rate today. Emergency fund In general, consider keeping approximately three to six months of living expenses within a liquid emergency fund. As an alternative to directing your income tax refund to a savings vehicle that may earn little interest, consider obtaining or increasing your line of credit for emergency purposes only. Receive your tax refund earlier If you do not want to wait until after you file your income tax return to receive your tax refund, you can also complete CRA Form t1213 -Request to Reduce Tax Deductions at Source if you have regular tax deductions such as RRSP, child care expenses and alimony. This form is used to ask for reduced tax deductions at source for any deductions or non-refundable tax credits that are not contained on the TD1 Form. If this form is accepted by CRA, they will authorize your employer to reduce the income tax withheld from your paycheque during the year. In essence, this will enable you to receive your tax refund periodically throughout the year rather than waiting for a lump-sum tax refund. • •• This information is not intended as nor does it constitute tax or legal advice. Readers should consult their own lawyer, accountant or other professional advisor when planning to implement a strategy. Mark Ryan is an advisor in Prince George with RBC Wealth Management, Dominion Securities (member CIPF) and can be reached at mark.ryan@rbc.com. Netflix could be bundled with TV packages instead of being a threat: Telus CEO The Canadian Press MONTREAL — Instead of being viewed as only a threat, online movie service Netflix could be bundled in with TV packages, Telus CEO Darren Entwistle said Thursday. Telus has “no regrets” about not owning any media or broadcast assets to provide the telecommunications company with content for TV, smartphones and tablets, Entwistle said after the company’s annual meeting. “It’s a threat, but it’s also an opportunity for us without a shadow of a doubt,” Entwistle said of U.S.-based Netflix which has about two million Canadian subscribers. “We could potentially bundle Netflix as a part of a Telus solution. We could perhaps buy it on a wholesale basis and brand it accordingly,” he said in an interview. There’s also nothing stopping Telus from developing over-the-top applications to compete with Netflix, he added. A number of Canada’s TV providers are offering on-demand services or developing platforms to compete with Netflix. If you have a news tip call the Citizen 562-2441, local 2759 TSX winners TSX losers TSX locals Stock Symbol Last dollar % 52 Wk 52 Wk Stock Symbol Last dollar % 52 Wk 52 Wk Stock Symbol Last dollar % 52 Wk 52 Wk Trade Chge Chge High Low Trade Chge Chge High Low Trade Chge Chge High Low NuvoResea NRI 2.84 +2.80 +6211.1 0.10 0.04 LundGldLt LGD 0.01 -0.01 -50.0 0.04 0.01 BallardPo BLD 1.030 -0.010 -1.0 1.580 0.580 MillCity MC 0.01 +0.01 +100.0 0.07 0.01 GldcliffR GCN 0.01 -0.01 -50.0 0.04 0.01 Canfor CFP 19.720 -0.390 -1.9 22.150 10.400 JazzResIn JZR 0.18 +0.09 +100.0 0.18 0.08 AmernNa U ANR.U 0.03 -0.03 -50.0 0.15 0.03 CdnNat’lR CNR 101.890 -0.100 -0.1 106.460 80.070 CreamMnrl CMA 0.02 +0.01 +100.0 0.16 0.01 SphereR H SPH.H 0.01 -0.01 -50.0 0.04 0.01 Chemtr UN CHE.UN 17.240 -0.030 -0.2 17.800 14.410 EpicData EKD 0.09 +0.05 +100.0 0.12 0.04 Centurion CTN 0.07 -0.04 -35.0 0.13 0.04 Enbridge ENB 47.120 -0.480 -1.0 48.090 37.740 LeisInds LES 0.02 +0.01 +100.0 0.16 0.01 PacCascad PCV 0.01 -0.01 -33.3 0.07 0.01 HuskyEner HSE 30.130 -0.240 -0.8 32.340 22.040 Gulf&Pac GUF 0.40 +0.20 +95.1 0.45 0.21 MeridexSf MSC 0.01 -0.01 -33.3 0.06 0.01 ImperialM III 11.480 0.190 +1.7 14.950 8.130 ARIUSRese ARI 0.10 +0.04 +72.7 0.11 0.05 TIEXInc. BGD 0.02 -0.01 -33.3 0.12 0.02 Int’lFo A IFP.A 10.110 -0.160 -1.6 10.700 4.280 eMediaNet EMM 0.05 +0.02 +66.7 0.05 0.02 Seair SDS 0.12 -0.06 -33.3 1.15 0.10 M,D&Assoc MDA 71.210 -0.070 -0.1 75.000 42.790 TrAmEnerg TAE 0.03 +0.01 +66.7 0.05 0.02 AcrexVens AKV 0.01 -0.01 -33.3 0.04 0.01 NovaGoldR NG 2.590 0.050 +2.0 6.980 2.280 GinguroEx GEG 0.07 +0.03 +55.6 0.14 0.04 DiazResou DZR 0.06 -0.03 -31.3 1.25 0.05 TELUS T 37.170 0.470 +1.3 36.890 28.825 TroymetEx TYE 0.02 +0.01 +50.0 0.06 0.01 ThompsonC TCM 3.850 0.600 +18.5 4.500 2.230 PearlRive PRH 0.03 +0.01 +50.0 0.08 0.02 TimHorton THI 55.750 -1.380 -2.4 58.850 45.110 ConsAbadd ABN 0.02 +0.01 +50.0 0.08 0.01 WestFrase WFT 83.500 -1.380 -1.6 94.540 41.860 CMCMtlsLt CMB 0.06 +0.02 +50.0 0.18 0.03 WestJetAi WJA 22.110 -0.940 -4.1 25.470 14.560 MUTUAL FUNDS best/worst Best Net Asset 3-Month Fund Value % Chge iShares Japan Fundamental Idx (CH)-CJP 10.890 23.938 Fidelity NorthStar Currency Neut Cl A 12.218 19.065 Mac Focus Japan Class Series A 8.140 18.835 Altamira Japanese Opportunity Fund 4.310 18.207 TD Japanese Index - I 7.510 17.874 TD Japanese Growth Fund - I 6.650 17.801 Fidelity NorthStar Fund Series A 17.352 17.478 Fidelity NorthStar Class Series A 17.554 17.397 iShares S&P/TSX Capped Inform Tech Index 7.915 17.170 Investors Japanese Equity Fund 6.079 16.210 Worst Net Asset 3-Month Fund Value % Chge DMP Resource Class Series A 9.320 -37.627 BMO Junior Gold Index ETF 8.153 -33.242 Sprott Gold and Precious Minerals Cl A 4.247 -32.262 Dynamic Precious Metals Fund Series A 4.240 -32.037 Sprott Gold and Precious Minerals Fund A 30.508 -31.917 Sentry Precious Metals Growth ClA 9.545 -31.912 Sentry Precious Metals Growth A 32.811 -31.837 BMO S&P/TSX EW Global Gold Index ETF 8.998 -30.129 IG Mac Global Precious Metals Class A 7.217 -28.986 Mac Unv Wld Prec Metals Class Ser A C 39.747 -28.724 FINANCIAL HIGHLIGHTS TORONTO (CP) — Highlights at the close of Thursday at world financial market trading. Stocks: S&P/TSX Composite Index - 12,543.90 down 41.15 points TSX Venture Exchange - 969.73 up 0.41 point TSX 60 - 718.15 down 3.18 points Dow - 15,082.62 down 22.50 points S&P 500 - 1,626.67 down 6.02 points Nasdaq - 3,409.17 down 4.10 points Currencies at close: Cdn - 99.26 cents US, down 0.41 of a cent Oil futures: US$96.39 per barrel, down 23 cents (June contract) Gold futures: US$1,468.60 per ounce, down $5.10 (June contract) Canadian Fine Silver Handy and Harman: $24.934 per oz., up 9.9 cents $801.63 kg., up $3.18 MARKET MOVERS TORONTO (CP) --- These are Singapore dollar 0.8159 indicative wholesale rates for foreign CURRENCIES Slovakia koruna 1.3142 currency provided by the Bank of Hong Kong dollar 0.1292 South Africa rand 0.1118 Montreal at midday on Thursday. India rupee 0.0185 Sweden krona 0.1541 Please inquire at any branch for cash Japan yen 0.010100 Switzerland franc 1.0662 rates. Quotations in Canadian funds. Mexico peso 0.0838 Thailand baht 0.0340 Australia dollar 1.0220 Pakistan rupee 0.0102 Trin-Tob dollar 0.1569 Brazil real 0.5017 Philippine peso 0.0246 Turkey lira 0.5594 Bulgaria lev 0.6721 Poland zloty 0.3187 Ukraine hryvnia 0.1237 China renminbi 0.1636 Romania leu 0.3040 U.A.E. dirham 0.2730 Denmark krone 0.1764 Russia rouble 0.0322 U.K. pound 1.5543 Euro 1.3140 Saudi Arabia riyal 0.2674 U.S. dollar 1.0027 TORONTO (CP) — Some of the most active companies traded Thursday on the Toronto Stock Exchange and the TSX Venture Exchange: Toronto Stock Exchange (12,543.90 down 41.15points): Bombardier (TSX:BBD.B). Transportation equipment. Up 24 cents, or 5.67 per cent, at $4.47 on 25.76 million shares. The plane and train maker stock hit a new 52-week high after reporting that its revenues soared 25 per cent in the first-quarter, helped by higher-than-expected aircraft deliveries. Profits were up US$148 million from year-earlier U$155 million, with both per share figures equalled to eight cents. Surge Energy Inc. (TSX:SGY). Oil and gas. Up 69 cents, or 18.80 per cent, at $4.36 on 18.55 million shares. The Calgary-based company said Paul Colborne will be its new president and CEO, effective immediately. It also announced the sale of non-core assets pegged at about US$42.75 million and a $2.5-million financing through private placement. Kinross Gold Corp. (TSX:K). Miner. Up two cents, or 0.36 per cent, at $5.63 on 9.25 million shares. Bankers Petroleum Ltd. (TSX:BNK). Up 33 cents, or 13.04 per cehnt, a $2.86 on 6.49 million shares. First-quarter profits nearly doubled to $14.2 million or six cents per share from year-earlier $7.77 million or three cents per share as revenue jumped close to 30 per cent. The Calgary-based company cited record production levels for the improvement. BlackBerry (TSX:BB). Wireless communications. Up 59 cents, or 3.96 per cent, at $15.49 on 6.10 million shares. Iamgold Corp. (TSX:IMG). Miner. Down 14 cents, or 2.32 per cent, at $5.89 on 4.95 million shares. The gold sector led the decliners on the main index, falling 1.37 per cent to 200.27 points as the price of bullion fell US$5.10 to $1,468.60 an ounce on the New York Mercantile Exchange. Companies reporting major news: Canadian Tire Corp. Ltd. (TSX:CTC.A). Retailer. Up $8.32, or 11.24 per cent, at $82.36 on 2.51 million shares. The company is set to create a $3.5 billion real estate investment trust, with an initial public offering to be launched later this year. Canadian Tire also posted a 2.9 per cent hike in its first-quarter earnings, boosted by a 1.7 per cent jump in total revenue.