A&S: TAXATION OF INSURANCE POLICIES

Question 1

LIFETIME CAPITAL GAINS EXEMPTION (LCGE) pg53?

Answer 1

• biz owner can shelter some capital gains with lifetime LCGE on canadian controlled private corps (CCPC’s)
• oer individual, not per biz
• max $800k since 2014
• also applies to some farms and family fishing biz — amounts may be diff

Question 2

CALCULATION:

Answer 2

SEE LATER

Question 3

TAXATION RULES TIPS

Answer 3

1. Life ins DB always tax free (premiums not deductb;e)
2. disability ins: if insured pays prem w after tax $, benefits = tax free
3. employer paid premoums : emplpyer can deduct for tax purposes
4. extended health care plans: no tax for employee (exception to rule below) ,
   usually:
   
   • if employer pays for employee: premium is taxable benefit
   • end policy subject to tax