Quick question about Tax Refund

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Aurn
Member since: Jan 07

Posts: 76
Location:
Post ID: #PID

Posted on: 15-02-07 22:18:35

Hi,

If a person's earning is CAD$70K and he put CAD5,000/= in RRSP, how much tax refund he will get. He doesn't have any other income with 4 dependents.

One of my friend is telling tax refund would be CAD$3,000/=, Let anybody could confirm it.

Thanks

sudesingh
Member since: Jul 04

Posts: 2085
Location: Toronto
Post ID: #PID

Posted on: 15-02-07 22:36:10

1. How much tax did you pay
2. How did you earn that money, ie thru regular employment, self-employed etc
3. How old are the dependents
4. Were you in the country for the entire year or part year
5. Do you have a RRSP limit from the previous year

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Aurn
Member since: Jan 07

Posts: 76
Location:
Post ID: #PID

Posted on: 15-02-07 22:43:03

Quote:
Originally posted by sudesingh

1. How much tax did you pay
2. How did you earn that money, ie thru regular employment, self-employed etc
3. How old are the dependents
4. Were you in the country for the entire year or part year
5. Do you have a RRSP limit from the previous year

1. Total tax that paid during year abt 18000/=
2. full time employment
3. Wife, kids are 12,11,4
4. Ontario throughout the year
5. Yes, RRSP limits is about 15,000/=

sudesingh
Member since: Jul 04

Posts: 2085
Location: Toronto
Post ID: #PID

Posted on: 15-02-07 23:15:11

Refund without RRSP = $4800
Refund with RRSP = $6400

Note: These numbers are approximate.

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SS
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chandresh
Member since: Mar 03

Posts: 2606
Location: Toronto
Post ID: #PID

Posted on: 16-02-07 10:07:58

Quote:
Originally posted by Aurn

Hi,

If a person's earning is CAD$70K and he put CAD5,000/= in RRSP, how much tax refund he will get. He doesn't have any other income with 4 dependents.

One of my friend is telling tax refund would be CAD$3,000/=, Let anybody could confirm it.

Thanks

you mean to say your friend is suggesting that your marginal rate of tax is 60%???

Looking at your other info especially RRSP room, it is evident that you have been paying taxes for last few years - and so would know your marginal rate of tax.

Chandresh

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Chandresh

Advice is free – lessons I charge for!!

dp_jain
Member since: Jan 04

Posts: 418
Location: Brampton
Post ID: #PID

Posted on: 16-02-07 10:16:36

Better contact your accountant. He/She will let you know correct amount. All other will tell you just an approx. number.

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investpro
Member since: Nov 06

Posts: 1628
Location: carl sagan's universe
Post ID: #PID

Posted on: 16-02-07 10:57:10

Hi,

The $5,000 investment and $3,000 tax return smacks of LSIF.

If you invest $5,000 in an LSIF with a $70,000 income you will get RRSP savings of approx $1,770 and an extra tax credit of 30% or $1,500 = $3,270 which is approx $3,000.

There are also LSIFs (labor sponsored funds) that give you an extra tax credit of 35% instead of 30%.

Please confirm with your friend if that is what he means. If he means something else, please let us know, perhaps we all can learn something.

As a footnote LSIFs are volatile except for ROI for the time being.

Contributors: investpro(3) Aurn(3) sudesingh(3) dp_jain(1) chandresh(1)

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