In this week's edition

Clients with private corporations could face a nasty tax hit if they make assumptions about how much they can distribute from their capital dividend accounts in 2024. For example, clients may believe that a capital gain realized before June 25, 2024 — when the capital gains inclusion rate rose to two-thirds from one-half — resulted in adding 50% of the gain to the corporation’s capital dividend account. But that’s not necessarily the case. Reporter Rudy Mezzetta provides the details.

As a trusted advisor, you support clients through life’s challenges, including the death of a loved one. But if you’ve ever struggled to respond effectively during such a difficult time, you’re not alone. A couple of advisors shared their experiences and approaches when supporting grieving clients. As one of the advisors said, sometimes, “shut up and listen” is the way to go.

As family responsibilities grow, one partner in a couple may decide to reduce work hours or leave the workforce altogether to care for children or aging parents. Financial advisors play a key role helping families consider how they can afford to live on a reduced income and how insurance needs will change. As sources told reporter Jonathan Got, the process starts with a family conversation, along with net worth and cash flow statements.

The Department of Finance recently closed a consultation on simplifying and modernizing the definition of “qualified investments” — those allowed in registered plans such as RRSPs. Among other questions, Finance asked whether the qualified investment rules should change to promote an increase in Canadian-based investments. The Investment Funds Institute of Canada (IFIC) weighed in, saying the federal government shouldn’t revive the foreign property ownership limit for RRSPs and other registered plans, given that Canadian investors require access to international diversification opportunities. Read more about IFIC’s suggestions, including whether cryptocurrency funds should remain qualified investments for registered plans.