As taxpayers we are all well aware that our government and Canada Revenue Agency are always looking for ways to collect more tax dollars from us. This year, 2015, will be the last year that tax sheltering using Universal Life insurance will be possible. For years, wealthy clients have used these policies to combine their needs for life insurance to pay the inevitable estate taxes that will be due at death, and shelter additional investments from ongoing taxation at the same time. These structures are not just for the wealthy however – they may (or may not) be appropriate for you.
The federal government has recognized that they are losing out on a lot of tax revenue due to this sheltering and are changing the rules so that this will no longer be available on new policies.
If you have not discussed your estate plan nor done an estate tax estimate yet, now is the time to do it! We only have a few more months to apply for the current tax deferred Universal Life policies, so please don’t delay in calling to book a time to talk about this, before this particular window is nailed shut for good.