With the upcoming Federal election, it’s worth paying attention to the fiscal plans from the various parties to see which best aligns with your preferences, but if you take one thing away from this blog, please note that nothing major is going to change in at the next year, if not the next two.
Should I make changes now?
We’ve been fielding inquiries from people about whether this the right time to incorporate a business or liquidate an investment property to maximize tax benefits, based on the various promises being made during the debates. However, we are telling our clients this is not the time to make any major changes.
First, we have to see who wins the election. If it’s not the Liberals, a new budget will be announced, meaning that any changes will be at least a year down the road. Especially during an election campaign, nothing you’re hearing can be relied on to be passed into law.
Planning during uncertainty
At this point, the ability to plan ahead based on promises is premature and the idea that friends may be telling you to buy or sell real estate, incorporate (or unincorporate), take dividends (or not to take dividends) is all speculative.
Based on the debates, it appeared that one of the big issues will be shifting from COVID recovery to climate change with policy changes happening at the corporation level in industries such as oil and gas and green energy production.
Each party has a different response to how we’ll deal with the huge COVID spend, though only the NDP has offered any specifics on how to deal with the money that’s been spent.
Only so much can change
Over the next couple of years, we’ll see those bigger target areas being focused on. There is only so much political will and capital to make change and you can’t change everything all at once. People want to see movement on the environment and COVID repayment. I believe those are the areas the government will be focused on rather than the day-to-day things that affect individuals.
Don’t make any big business or life decisions based on tax policy that may or may not come into effect two years from now!
Don’t forget to vote!