Registered Retirement Income fund (RRIF) rules were recently changed to take into account the changing financial outlook for retirees. The government does not allow taxpayers to keep investments in their Registered Retirement Savings Plan (RRSP) for their entire lifetime. By the end of the year in which a taxpayer turns 71, they must have rolled their RRSP into a RRIF, or report all of the money in their RRSP as taxable income on their personal income tax return for that
Once the investments have been rolled into a RRIF, the government dictates the amounts that must be withdrawn from the RRIF on an annual basis.
Minimum annual withdrawal amounts, coupled with decreasing interest rates, were resulting in many retirees depleting their RRIF’s earlier than anticipated.
The original calculations used to determine the required withdrawal amounts from RRIF’s were based on assumptions that returns on investment would be 7%, and inflation would be 1%. This type of investment return is now unrealistic for most seniors with a conservative portfolio.
The new guidelines assume a 5% return on investments, as well as a 2% rate of inflation. Although a 5%  return may still be higher than most retirees receive on their investments, it has helped to reduce the minimum withdrawal rate. The new minimum withdrawal rate for people who turn 71 in the year will be 5.28% of the balance in the RRIF. The previous minimum withdrawal rate was 7.38%. Furthermore, between the ages of 71 and 94, all minimum withdrawal rates have been lowered. By the time a taxpayer is 94, the minimum withdrawal rate is 20%, which is the same percentage that has been used in the past. For somebody  who has withdrawn over 5.28% already from their RRIF, they will be allowed to repay their overpayment back into their RRIF. The excess must be recontributed
to the investment by February 29, 2016. One drawback of taking a smaller annual withdrawal is that the taxpayer may have a larger balance in their RRIF when  they pass away, resulting in a higher total tax bill on cumulative withdrawals. This should be considered when determining how much is going to be withdrawn on an annual basis.


The Canada Revenue Agency (CRA) is again reminding taxpayers to be wary of scams from individuals pretending to be from the CRA. These scams range from e-mails which claim a taxpayer can receive a tax refund if they click on a link, to harassing phone calls demanding a payment on a tax account. The CRA will only send out deposits by cheque or by direct deposit. They will never send out a refund by e-transfer.  They will also never ask to use a cash card or Western Union transfer to make a payment. The CRA has provided these general guidelines to follow if a taxpayer should be contacted by someone claiming to be from the CRA.
• The CRA will not send emails containing anylinks.
• The CRA will not request personal information of any kind from a taxpayer by email or text message.
• The CRA will not divulge taxpayer information to another person unless formal authorization is provided by the taxpayer.
• The CRA will not send emails in English or French only: all communications are in both official languages.
• The CRA will never request information about a person’s passport, health card, or driver’s licence.
In addition, the CRA will not leave any personal information on an answering machine. Fraudulent callers can be very intimidating. They can
insist that a taxpayer make a payment to the CRA immediately, and will tell the taxpayer that they will be sending the RCMP to their home if they do not comply.
If somebody is concerned that a caller is not from the CRA, they can advise the caller that they would like to verify their number first. They can check on the authenticity of a CRA telephone number by contacting the CRA directly, at 1- 800-959-8281.

Congratulations to our own Jim Burch, Grand Forks office

2015 Board of Governors Election

CGA-BC is holding an election for the 2015 Board of Governors.  A call for nominations to fill seven vacancies resulted in the following:

One vacancy in District 5 –  East West Kootenays

One nomination was received to fill one seat; therefore the following individual is elected by acclamation:

Nominee Residence
James (Jim) R. Burch Grand Forks

Way to go Jim – we look forward to hearing more about this.


Request from CRA legitimate?

Ever wonder if information requests from Canada Revenue Agency (CRA) are legitimate? There are many fraudsters out there who are very creative when it comes to obtaining information. Often they already have some information about you which makes you feel comfortable to discuss your affairs with them. It’s important to note the following to protect yourself against fraud.

–          CRA will never request information from you through email or text messaging.

–          CRA will never leave a voice message containing confidential personal or tax information.

–          Benefit payments are always issued on specific dates.

–          You are the only one with access to your account unless written authorization has previously been given by you.

If you are not sure about the authenticity of a call or letter, phone CRA at 1-800-959-8281 to ensure it is legitimate. Be mindful that CRA will ask specific questions to ensure you are who you say you are when phoning them. Often CRA will ask questions regarding your previous year’s tax return so be sure to have it close by.

When it comes to giving out confidential information its best to be cautious.

New rules for federal not-for-profit organizations

Are you a federally incorporated not-for-profit organziation? On October 17, 2011 the new Canada Not-for-profit Corporations Act came into force. This Act is designed to simplify processes, procedures and requirements. This Act will apply to any federal non-share capital corporations incorporated after October 17, 2011. Federal corporations, such as Canadian charities incorporated under the old Act, may continue to operate under the old Act until October 17, 2014. However failure to transition within this time period could result in dissoultion of the corporation by Corporations Canada.

Contact your local KH Group office for more information or visit: