Like most government publications, the leaflet on the New Ontario Senior Homeowners’ Property Tax Grant was virtually impossible to understand. Below is my interpretation so that you don’t need to consult a lawyer or accountant to figure out if this grant is something that you can take advantage of.

What does an eligible senior mean?

• At least 64 years old by Dec 31st 2008
• Living in your home (your primary residence) that you own in Ontario and have paid property taxes on in 2008.
• Your spouse (the person you’re married to) or common-law partner did not receive a property tax grant for 2009.
• You paid $250 or more in property tax in 2008 either as a single senior or a couple.
• You are single with an income less than $50,000 or you are a couple with an combined income of less than $60,000.

Great! Where do I apply?

When you get your 2008 personal income tax forms, look for Form ON479 – Ontario Credits. You can also check the Canada Revenue Agency website in early 2009 to download the form. It’s even available in LARGE PRINT!

Wait a sec – I already get property tax relief through the Ontario Tax Credits.

Don’t worry, if you are already receiving full property tax relief, you will continue to do so through the combination of grant and credit. This means you not only get the existing property tax relief, you get up to $250 on top of that!

I want to speak with someone about this.

No problem  – you can call 1 800 337-7222 or 1 800 263-7776 teletypewriter (TTY) between 8:30 am and 5:00 pm, Monday to Friday.

Is there a government website than I can go to?

Here is the link to the Ministry of Revenue’s Senior Homeowners’ Property Tax Grant webpage.

In 2010, the Ontario Senior Homeowners’ Property Tax Grant goes up to $500.

Did you know that you can follow the Ontario Ministry of Revenue on twitter? They don’t have a blog  listing yet as far as I know!

Below are answers to some more questions about the TFSA and how it will impact your retirement plans.

Will money earned in a TFSA or withdrawn from a TFSA be considered income for tax purpose?
No, when computing income for tax purposes, you will not have to include money earned in a TFSA or withdrawn from a TFSA.

Will contributions and withdrawals affect my Old Age Security or Guaranteed Income Supplement benefits?
No, any contributions or withdrawals will NOT reduce other benefits that are based on your individual income level.

Since it’s called a tax-free savings account, do I have to put my money in a savings account?
No, you can hold the same investments as a RRSP. This means you can invest in mutual funds, publicly traded securities, GICs, bonds and certain shares of small business corporations. Check with an account or tax lawyer for more information on this.

What investment vehicles will I be able to use?
No more stuffing the cash under your mattress! You’ll be able to open a savings account, invest in mutual funds, publicly traded securities, GICs, bonds and certain shares of small business corporations..tax free!

Can I borrow money to invest in an TFSA and deduct the interest payment?
No, interest on money borrowed to invest in a TFSA would NOT be deductible for tax purposes.

If you have any more questions, please ask them here.

The Federal Government has passed legislation to let Canadians save without paying tax on the interest we earn. Soon, you will be able to save up to $5,000 every year without being taxed on interest earned. This is great news for savers, especially retired individuals. Below are some common questions that I’m sure you have thought about and answers to put your mind at ease:

What is a Tax-Free Savings Account?
A tax-free savings account or TFSA is a registered savings account that allows Canadian taxpayers to earn investment income tax-free inside the account.

When can I open a TFSA?
According to the 2008 budget, you can open a TFSA starting in 2009.

Are contributions to the tax-free savings account tax deductible for tax purpose?
No, contributions are NOT deductible.

Are withdrawals of contributions and earnings from the tax-free savings account taxable?
No, withdrawals of contributions and earnings from the TFSA are NOT taxable.

Would there be any restrictions on withdrawals like there is on Registered Retirement Savings Plans (RRSPs)?
No, you can withdraw any amount from your tax-free savings account for any reason.

Are there any tax benefits to making a contribution to a TFSA?
No, contributions to a tax-free savings account would NOT be deductible in computing income for tax purposes.

I have more questions about the TFSA – where do I go?
Watch for part II of this article next week.