The writer is a Vancouver mortgage broker with an interest in tax efficient mortgages.
Unfortunately, tax efficient mortgages come under the heading of advanced tax planning.
Sadly, the disregard Canadian’s show for this technique costs them hundred’s of thousands of dollars. A hallmark of Canadians is their willingness to do things on the cheap. Checks the internet…cobble together some articles…viola the answer appears. Or my personal favorite is the internet query that turns into a 30 minute conversation with promises of business but the real intent is to prise years of experience from the broker for free.
In the interest of full disclosure…Yes these comments are self serving.
The real meat of the matter is that professionals are necessary for this level of tax planning. The reason is the CRA does not want Canadians to employ this technique for the simple reason is that the lost tax revenues would be enormous. The rules of the game have been set by the Supreme Court of Canada. You have a right to make your mortgage tax efficient.
Imagine turning your 25 year amortization into a 14 year amortization. If your mortgage payment was $1500 per month over that 11 year period you would save $198,000…did I mention the tax deductibility of the interest portion of the reinvested equity??? Wow, a write off your neighbour is ignoring.
This is the first of a series of articles on the concept of making your mortgage tax efficient. As the guy in ING commercials says “Save your money”
