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CRA Flags “Aggressive” Insurance-Based Tax Schemes: A Short, Practical Guide for Canadians

The CRA is warning Canadians about certain “tax-saving” arrangements built around critical illness insurance and complex lending structures. These pitches can look polished and legitimate, but the agency says they’re often designed to help shareholders extract corporate money without paying the tax that would normally apply. The result can be reassessments, penalties, and serious legal exposure.

What the CRA is warning about

The CRA says it is seeing aggressive arrangements involving critical illness insurance and complex transactions, including borrowing to fund insurance-related steps. The issue is not buying insurance. The issue is when insurance is used as a wrapper for a tax result that doesn’t hold up.

How these arrangements typically work (the pattern)

While specifics vary, the CRA describes a structure that often includes:

• Limited recourse loans: the lender’s recovery is restricted to specific collateral, commonly the policy itself (not your broader assets).

• A circular flow of funds: money is routed through connected parties so it appears to be a legitimate set of transactions, while the shareholder ends up with accessible funds positioned as tax-free.

• Promoter networks: schemes may be marketed by groups operating inside or outside Canada, sometimes involving offshore providers.

Quick comparison: legitimate planning vs. CRA-flagged scheme signals

What to do before you sign anything

Use this as a practical filter:

• Slow down if the pitch relies on insurance + borrowing to “eliminate” tax.

• Get independent advice from a qualified tax professional who is not tied to the promoter.

• Be wary of offshore layers and multi-party money loops you can’t clearly explain back in one minute.

• Ask for written support: clear tax rationale, not marketing slides.

Callout: If the headline benefit is “tax-free corporate cash,” treat the entire structure as high risk until an independent expert confirms it’s defensible.

Source: CP24

The Anti-Entitlement Advantage: What Actually Wins in 2025

Most people are not losing because the market is unfair. They are losing because they expect progress without the reps. The takeaway from GaryVee is blunt: ditch entitlement, lock down your spending, and build real skills, especially on social.

The mindset shift

• Renting vs. owning is a math decision, not an identity.

• “Easy money” is a trap. Consistency beats hacks.

• Losing is feedback, not a verdict.

Listen / watch: GaryVee

How to Get Approved for a $1 Million+ Mortgage in Toronto’s Luxury Market

Buying or refinancing above the $1 million mark is not just a bigger mortgage. It is a different approval process with tighter underwriting and more scrutiny. A strong strategy improves your odds of approval, protects your rate options, and helps you avoid last-minute conditions that delay closing.

Why $1M+ approvals get stricter: Once your mortgage crosses seven figures, lenders tend to assess overall financial strength, not just income.

They commonly focus on:

• Debt-to-income and total monthly obligations

• Credit history and repayment consistency

• Liquidity and cash reserves after closing

• Net worth and asset diversification

The 2025 window: plan while rates stabilize

With interest rates stabilizing after prior hikes and markets watching for potential easing later in 2025, preparation matters more than timing guesses. A well-built application positions you to take advantage of better pricing if competition increases.

How a specialist helps you get approved

Many bank channels follow rigid rules. A specialist can structure the deal and match you to the lender type that fits your profile, including A, B, and private options.

Common approaches include:

• Asset-based approvals for high-net-worth clients

• Blended-rate refinancing to manage payment pressure

• Extended amortizations where appropriate

• Solutions for self-employed and variable-income borrowers

• Presenting equity, liquidity, and investments as compensating strengths

What lenders weigh most on $1M+ mortgages

Your pre-approval checklist

Prepare early:

• Income documents for the last two years

• Full list of debts and monthly payments

• Proof of down payment, reserves, and source of funds

• Investment statements and key asset summaries

• Short explanations for any income swings or credit events

Avoid common pitfalls:

• Large unexplained deposits

• New borrowing during underwriting

• Income claims without documentation

• Depending on a single lender’s formula

✨ Contact Genelle Today

Ottawa Signals a Long-Term CRA Service Fix as the 100-Day Plan Ends

CRA call centre access has been a real pain point for Canadians who need answers on refunds, benefits, and filing issues. As the agency’s 100-day plan to reduce call delays ends on December 11, Ottawa says it is developing a three-to-five-year strategy to improve CRA service more broadly. The key takeaway for households is simple: expect gradual improvement and protect yourself with better documentation and verification.

What’s happening now

The 100-day plan focused mainly on reducing call centre delays. Federal officials have described it as a short-term measure, not a full solution.

What the CRA says is coming

CRA leadership has pointed to more standardized training and the use of artificial intelligence to improve consistency and reliability over time.

• Write down the date, agent name or ID, and a clear summary of advice.

• Ask what publication or rule the answer is based on.

Callout: If the decision affects how much tax you owe or claim, verify the answer before acting.

Source: CBC News

Tax Mechanic’s Year-End Tax Planning Series: 10 Essential Moves Before December 31

The year-end countdown is also a tax deadline countdown. Many of the most valuable planning moves only work if they’re done by December 31, not after.

@taxmechanic

The countdown to December 31 has officially started. Most tax opportunities expire at midnight and once they’re gone, they’re gone. I’m br... See more

Tax Mechanic has already started releasing a 10-video series (beginning Monday, December 1) covering the year-end tax actions Canadians should review before the deadline. We’ll clarify the difference between the December 31 cutoff and the RRSP contribution deadline, explain tax-loss selling and superficial loss rules, and show practical ways to optimize TFSA and FHSA room. We’ll also cover RESP grant timing, charitable and medical credits, and key year-end considerations for business owners.

Follow along and catch up starting with Part 1 so you don’t miss high-impact opportunities before December 31.

Need help now? 👉 Book a consultation / Contact us — check our Google reviews to see client outcomes.

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