Before year end, check in with your financial self
The final months of the year contain some important deadlines for investors and taxpayers. Here are some things to consider:
Charitable donations. December 31 is the deadline for making a charitable donation that can be claimed for the 2020 tax year.
Tax deductions and credits. December 31 is also the final payment date in order to receive a 2020 tax deduction or credit for expenses such as childcare, medical and tuition tax credits.
Tax-loss selling. You have until late December to sell a security that settles in 2020. December 29 is the expected last buy or sell date for Canadian securities to settle in calendar year 2020, based on trade date plus two business days.
However, it is recommended to review your non-registered investment portfolio earlier to consider the sale of securities with accrued losses before the end of the year to offset capital gains realized in the year, or in the three previous taxation years, if the net capital loss was created in the current year.
RRSP Conversion. If you turned or are turning 71 this year, December 27 is the deadline for collapsing your Registered Retirement Savings Plan (RRSP). However, planning for this important financial change should be done well in advance of the December deadline.