Protecting the Value of Your Assets¶
Are your savings being eroded by taxes? Life insurance may be the solution you’re looking for.
At Palladium Insurance, we pride ourselves on a long history of protecting Canadians’ financial security. Talk to us to learn more about our flexible life insurance programs.
Request a ConsultationAre You Paying More Taxes Than You Should?¶
After years of careful planning, you’ve saved enough for a comfortable retirement. In fact, you may have more than you need to live comfortably.
The problem is that you’re taking a big tax hit because your money is growing in non-registered investments. The more successful your investments are, the more you owe the tax man.
You don’t want the benefits of your careful planning to be eroded by taxes. Life insurance can be the savings vehicle you need to shelter more of your hard-earned nest-egg. It can benefit the people or charities you cherish most, while growing in a tax-advantaged way.
Tax Shelter Questions¶
What Is a Tax Shelter?¶
A tax shelter is any kind of legal investment that reduces your taxable income, and therefore the amount you owe the CRA. Some, like registered investments (RRSPs, RESPs, and TFSAs) and income splitting are open to all Canadians, while others make more sense for high net-worth individuals.
What Makes Life Insurance a Great Tax Shelter for High Net-Worth Individuals?¶
Once your income exceeds $200,000 per year, additional tax shelters become an option. Some of these tax shelters are more like a delaying tactic because taxes need to be paid when income is generated through returns or when the asset is sold. A good example of this kind of trade-off is flow-through shares (shares that include a permitted tax deduction).
On the other hand, if your assets grow within a life insurance policy, you’re spared the tax payments. When you pass away, all the assets within the policy are given to your heirs outside the scope of your estate, bypassing taxes and other associated costs like executor’s fees.
To sum it all up, when you transfer investments into a tax-advantaged life insurance policy, you gain a tax-free estate benefit which you can bequeath to anyone you wish. You can also be assured a guaranteed cash value, over and above large tax savings.
With Palladium Insurance’s flexible legacy solutions, you maintain complete control of your policy. You can even choose to tap into its cash value at any time.
What Types of Life Insurance Can Provide a Tax Shelter?¶
With permanent life insurance policies (either whole life or universal life), your beneficiaries not only get a lump sum benefit when you pass away, you get the tax shelter component.