Something old, something new, and everything borrowed.......

Mar 25, 2019 | Jeremy Goldfarb


Canadian lawmakers may have spent too much time reading about Modern Monetary Theory the past few months (MMT). More on that in another post. We were inundated with "first look at the new budget" posts last week, and you may have seen this as well. I prefer to take a more thoughtful approach, digest the information I have seen, and try to provide you with some insight into the more common elements we find ourselves exposed to and talking about. To the extent that you are concerned with the extension of the mineral exploration tax credit, there is something for you to read about in the attached Budget summary, however I am going to cover 2 or 3 highlight items


  1. Increase to the first time home buyers incentive plan -- perhaps for the younger investor (your kids, associates, extended family), the increase to the FTHBIP is not necessarily meaningful, but it is better than what was there before. One can now use up to $35,000 of RRSP investments to make a down payment on a first home (as opposed to the previous $25,000). The qualifying measures are important to know so please pay attention to those
  2. CMHC shared equity mortgage....essentially 10% equity mortgage in a new home build, and 5% on an existing home build will be made available from CMHC. I have had a few conversations with accountants and this is a bit of a mess coming out of the chute. Don't ask me how it is accounted for, and how it is represented when one sells. The other complication may occur in the event you move to refinance your home for the purposes of making improvements. Stand by for more
  3. An older one, but for all you day traders out there......Active TFSA trading. This is an old one....if you are deemed to be actively trading in your TFSA account, you could be dinged for active business taxation, thus eliminating the entire benefit of the TFSA. Be careful with this. It's a tough one to uphold and very gray in terms of the classification however it is important to know

Call me if you would like to talk more about these, or any other elements of the budget. We seem to be spending ourselves into oblivion thus the title of today's post. You don't have any choice in this marriage either.