Changes enacted by the previous government mean that starting Jan. 1, the tax treatment of universal life policies will be less promising. New policy holders won’t be able to build investment gains above death benefit premiums on a tax-free basis to the extent they’re able now.
A new formula for calculating insurance will result in policies being slightly more expensive or reduced death benefits, according to the report.
There will also be increases in some tax amounts, including maximum RRSP contributions, tax brackets and the maximum amounts of some credits, according to Global News. Those are set to increase in 2017 to keep pace with inflation, but the tax-free savings account limit will remain at $5,500.
Still, most changes announced in the 2016 budgets of the federal and provincial governments have already been implemented.
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