This page contains a Flash digital edition of a book.
On the Money


DAVID TRAHAIR


Personal Finance Cheat Sheet — 2016


S


INCE MY CHEAT SHEET IN 2015 seemed to be quite popular with our readers, here is the updated version of the key numbers related to personal finance for 2016.


RRSP: the limit for 2017 is $26,010, meaning 2016 earned income of $144,500 is required to maximize the amount since the limit is 18%.


RRSP LIMIT Year


2017 2016 2015 2014 2013


Limit


$26,010 $25,370 $24,930 $24,270 $23,820


Prior year earned income required


$144,500 $140,944 $138,500 $134,833 $132,333


Canada Pension Plan: the year’s maximum pensionable earnings (YMPE) for 2016 is $54,900. The year’s basic exemp- tion (YBE) is $3,500. At a contribution rate of 4.95%, the maximum CPP contribution is therefore $2,544.30. For self- employed individuals the contribution rate is 9.9%, so the maximum CPP contribution is $5,088.60. The maximum CPP retirement pension for 2016 is $1,092.50 a month or $13,110 a year. The maximum survivor’s benefit for


KEY CPP FIGURES Year


YMPE YBE


Maximum annual


employee


2016 2015 2014 2013 2012


$54,900 $53,600 $52,500 $51,100 $50,100


$3,500 $3,500 $3,500 $3,500 $3,500


contribution $2,544.30 $2,479.95 $2,425.50 $2,356.20 $2,306.70


Maximum annual


self-employed contribution


$5,088.60 $4,959.90 $4,851


$4,712.40 $4,613.40


a survivor 65 and older is 60% of that, or $7,866 annually. The amount of the death benefit has been fixed at a maximum of $2,500. In 2016 the reduction for collecting the CPP pension before


age 65 as early as age 60 is 0.6% per month (7.2% a year). The premium for waiting to start aſter age 65 up to age 70 is 0.7% a month (8.4% a year).


Tax-free savings account: the TFSA started in 2009 for Canadian residents aged 18 and older. Under proposed legisla-


TFSA CONTRIBUTION LIMITS Year


2016 2015 2014 2013 2012 2011 2010 2009


Annual limit $5,500


$10,000 $5,500 $5,500 $5,000 $5,000 $5,000 $5,000


Cumulative limit $46,500


$41,000 $31,000 $25,500 $20,000 $15,000 $10,000 $5,000


tion, starting on January 1, the annual TFSA limit for 2016 will decrease from $10,000 to $5,500. The TFSA annual room will be indexed to inflation and rounded to the nearest $500.


Maximum CPP


retirement pension


$1,092.50 $1,065


$1,038.33 $1,012.50 $986.67


Registered education savings plan: contributions to an RESP are not tax deductible but earnings in the plan accumulate on a tax- deferred basis. When the funds are paid out to fund a child’s education, the accumulated income earned in the plan is taxed in the child’s hands at his or her lower tax rate. Since 2007 there has been no


annual contribution limit but the total lifetime ceiling is $50,000 per beneficiary. RESPs are oſten set up as family plans so you can allocate the plan assets among related


52 | CPA MAGAZINE | JUNE/JULY 2016


Photo: Jaime Hogge


Page 1  |  Page 2  |  Page 3  |  Page 4  |  Page 5  |  Page 6  |  Page 7  |  Page 8  |  Page 9  |  Page 10  |  Page 11  |  Page 12  |  Page 13  |  Page 14  |  Page 15  |  Page 16  |  Page 17  |  Page 18  |  Page 19  |  Page 20  |  Page 21  |  Page 22  |  Page 23  |  Page 24  |  Page 25  |  Page 26  |  Page 27  |  Page 28  |  Page 29  |  Page 30  |  Page 31  |  Page 32  |  Page 33  |  Page 34  |  Page 35  |  Page 36  |  Page 37  |  Page 38  |  Page 39  |  Page 40  |  Page 41  |  Page 42  |  Page 43  |  Page 44  |  Page 45  |  Page 46  |  Page 47  |  Page 48  |  Page 49  |  Page 50  |  Page 51  |  Page 52  |  Page 53  |  Page 54  |  Page 55  |  Page 56  |  Page 57  |  Page 58  |  Page 59  |  Page 60  |  Page 61  |  Page 62  |  Page 63  |  Page 64  |  Page 65  |  Page 66  |  Page 67  |  Page 68  |  Page 69  |  Page 70  |  Page 71  |  Page 72