Whereas it’s now too late to set off any tax loss gross sales for 2023, the rocky efficiency on markets all through the final 12 months should imply there’s a possibility to lock in some tax loss gross sales now. Relying in your market outlook, this can be a second to set off some tax loss gross sales for 2024 earlier than any potential rally in fastened earnings or equities takes place.

Learn extra: Tax planning not a year-round precedence for many Canadians | Wealth Skilled

Courcelles notes that if losses exceed beneficial properties in a specific 12 months, the surplus might be carried again as much as three years or ahead indefinitely. A loss triggered this 12 months, in extra of any beneficial properties, might be utilized again to tax payments as latest as 2021. Early in 2024, if losses can nonetheless be triggered, Courcelles notes that the surplus loss generally is a large benefit. Any losses triggered now, too, might act as a type of credit score towards the debit of beneficial properties triggered later within the 12 months.

Charitable donations are one other space that advisors can evaluate with their shoppers in 2024. Within the scramble to finish 2023, some methods and alternatives for revision might need been ignored. Courcelles notes that in most provinces, the primary $200 of donated cash is eligible for a a lot smaller tax credit score, whereas any donations in extra of that $200 can qualify for a far better credit score. If in reviewing tax plans early in 2024, an advisor sees their consumer donates $300 annually to a charity, Courcelles recommends making a $600 donation one 12 months and never donating the following 12 months, pulling ahead a far better tax profit.

Donations in form of securities might be much more helpful from a tax perspective. If a consumer was to promote their holding and donate the proceeds, they’d need to pay capital beneficial properties tax on 50% of their beneficial properties earlier than getting a credit score. Donating the safety in variety wouldn’t set off any cap beneficial properties, however would ship the equal tax credit score.