How to minimize your tax?

Different countries have different tax laws. However, there are always ways to help you minimize your taxes. Look into the following areas and see whether they can help you.

Business Expenses

Gifts to customers or clients and other expenditures like the cost of sending customers holiday cards are deductible in most countries against business or self-employed income. Of course, if you're self-employed, the expense comes out of your income from self-employment.

Mortgage Interest Expense

Homeowners and rental property owners in some countries can fully deduct interest paid on home mortgage loans against their total income or rental income respectively.

College / Education

You can earn a tax break if you're taking classes for your career. Your expenses are deductible as an itemized deduction. This deduction, however, is limited to the amount of your qualified education expenses, subject to different tax rules in different countries.

Medical Expenses

In many countries you can deduct allowable medical expenses. For example, in the U.S. , you can itemize your deductions, provided that your total medical expenses must exceed a percentage of your adjusted gross income (AGI). In the mean time, if you and your spouse file separate returns, you can claim expenses you paid for your spouse if you were married either at the time your spouse received the medical services or at the time you paid the expenses. Of course, if you file a joint return for a tax year, any expenses paid by either of you at any time during the year would be deductible.

Income Averaging

Many tax systems have tax rates that are scaled according to your income.  Therefore, you can have significant tax savings by averaging your income.  For example, if you know your income will be lower next year, you could arrange your fiscal year end bonus to be paid after the start of the new fiscal year. Also consider the tax effect of postponing the sale of your investments until next year, or offset the gain with a loss from the sale of other investments. These methods can save you from the high cost of paying tax at the next higher marginal rate.
Harris Fraser offers access to tax professionals for most major jurisdictions.  Our advisors are trained to watch for situations where your needs for tax planning arise so that they will recommend that timely, relevant advice from a tax planner is required.