5 BULLET FRIDAYS - Tax Mechanic News, Tips & Strategies

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Money On Your Mind: Why Tax Literacy Is a Financial Advantage

What Most Canadians Overlook

Financial Literacy Month pushes the idea of “talking money,” yet taxes remain the blind spot. Tax literacy is not paperwork. It’s strategy. When you understand how the system works, you unlock cash flow, reduce long term costs and prevent avoidable risk.

1. Turning Filing Into Income

Filing isn’t just compliance. It’s cash flow. Many families leave thousands of dollars unclaimed.

Key Annual Benefits

Direct deposit speeds everything up and removes processing delays.

2. Getting Ahead on Housing

Affordability is brutal. But the tax system actually gives first time buyers and multigenerational households leverage.

Key Housing Tools

• FHSA: Tax deduction on contributions + tax free growth
• Home Buyers’ Plan (HBP): Borrow from your RRSP without tax penalties
• Multigenerational Home Renovation Credit: Helps families create shared living spaces

Using these together is where the real advantage compounds.

3. Building Wealth Efficiently

Registered accounts are the long game. Each protects your money differently.

How Each Account Creates Value

CRA’s updated TFSA tools reduce penalty risk and help track limits accurately.

4. Protecting Yourself

Tax literacy also means recognizing threats. Most scams exploit people who don’t know what CRA will never do.

CRA Will Not

• Demand immediate payment
• Request payment through gift cards or unusual methods
• Threaten arrest or legal action by phone
• Pressure you urgently

When unsure, check your CRA account instead of reacting.

Source- CRA

The Real Foundations of Success: What AI and Adversity Teach Us About Winning Again

Episode 94 of Tea with GaryVee underscores a reality most people overlook: progress doesn’t stall because of technology or lack of opportunity. It stalls because of emotional avoidance, unproductive environments, and habits that quietly undermine growth. For Canadians working toward financial stability and better decision making, understanding these behavioural patterns is just as important as understanding money itself.

1. Confidence Requires Honest Self-Assessment

Confidence isn’t created through bravado. It comes from accurately recognizing your weaknesses so they can be corrected. Ignoring insecurity only turns short-term issues into long-term limitations.

2. Coddling Creates Risk-Averse Adults

Many adults were protected from losing as children, and now treat normal challenges as threats. This leads to hesitation, poor financial decisions, and a fear of long-term commitments. Losing is a temporary condition, not an identity.

3. Human Skills Still Outperform AI Shortcuts

Even with rapid technological change, emotional discipline, consistency, and resilience remain decisive advantages. AI amplifies effort, but it cannot replace accountability.

Where People Spend Energy vs Where Results Come From

Don’t Miss Your 2025 FHSA Window: A Smart Opportunity for First-Time Homebuyers

For Canadians preparing to enter the housing market, opening a First Home Savings Account (FHSA) in 2025 is a strategic move. With an annual contribution limit of $8,000 and the ability to carry forward unused room, early action strengthens future buying power. Even a small contribution this year ensures you don’t lose valuable space that can support your long-term savings plan.

1. Why Opening an FHSA This Year Matters

A minimal 2025 contribution unlocks next year’s carry-forward, allowing up to $16,000 of room in 2026. This makes the FHSA one of the most effective tools for building a down payment efficiently and tax-advantageously.

2. A Strong Option for Parents Supporting Their Children

Parents helping adult children save for a first home can use the FHSA to create disciplined, tax-efficient savings. Contributions are tax-deductible, investment growth is tax-free, and withdrawals for a qualifying purchase are also tax-free.

3. How the FHSA Compares to RRSPs and TFSAs

Account Comparison for Homebuyers

Conclusion

For first-time buyers and supportive families, acting in 2025 ensures you maximize tax benefits and create a more resilient homeownership plan.

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How Retirees Can Navigate CRA Quarterly Tax Instalments With Confidence

Many new retirees are surprised to learn they may need to pay income tax to the Canada Revenue Agency (CRA) every quarter rather than once a year. This shift happens because retirement income often lacks automatic tax withholding. Understanding how instalments work can help retirees avoid penalties, manage cash flow and choose the most efficient payment method.

1. Why Retirees Are Asked to Pay Instalments

The CRA requires quarterly instalments when taxes owing exceed $3,000 in the current year and one of the previous two years. RRIF withdrawals, CPP, OAS and investment income typically have little or no tax withheld, making instalments common for retirees.

2. How CRA Calculates Instalment Amounts

CRA reminder notices arrive in February and August.
Payment dates: March 15, June 15, September 15, December 15.

Payments are estimated using:
• Tax returns from two years prior (March and June)
• Last year’s tax return (September and December)

Retirees are refunded if they overpay or must pay the difference when filing.

3. Choosing the Right Instalment Method

Instalment Calculation Options

Source: The Globe and Mail

Fraser Simpson Live Friendly Tax Debate

Fraser Simpson from Tax Mechanic will be joining Kevin Johnston for a live, friendly tax debate focused on clearing up common misconceptions and giving Canadians straightforward, experience-based tax insight.

@taxmechanic

I’ll be going live with Kevin Johnston on November 25th at 9PM EST for a friendly debate and an open conversation about the tax topics eve... See more

Event Details

What to Expect