2025 Tax Planning in Canada (Part 5)
Bringing It All Together – Tax Planning Checklist & Case Studies
By now, we’ve explored both basic and advanced strategies for minimizing taxes in Canada for 2025. The key to successful tax planning isn’t just knowing the rules—it’s organizing them into a clear action plan you can actually follow throughout the year.
This section will help you:
Apply a practical tax planning checklist for different situations.
Stay on top of important 2025 tax deadlines.
See a realistic case study of a Canadian family’s tax plan.
Build a month-by-month tax planning roadmap for 2025.
1. Tax Planning Checklist for 2025
a. For Individuals & Families
✅ Contribute to RRSP before March 1, 2026 (deduction for 2025 income).
✅ Maximize TFSA contributions ($7,000 for 2025, plus unused room).
✅ Review childcare expenses, claimable if both parents work.
✅ Track medical expenses—consider pooling them under the lower-income spouse.
✅ Review tuition credits—transfer unused amounts to parents.
✅ Plan for charitable donations—bundle them for higher credits.
✅ Consider income splitting strategies (pension, spousal RRSPs, prescribed loans).
b. For Business Owners
✅ Optimize salary vs. dividends.
✅ Use the $500,000 small business deduction (watch passive income).
✅ Keep proper books for deductions (vehicles, meals, home office).
✅ Consider family trusts for succession planning.
✅ Make corporate charitable donations (sometimes more tax-efficient).
✅ Plan capital purchases before year-end to maximize capital cost allowance (CCA) deductions.
c. For Retirees
✅ Decide when to start CPP/OAS (age 60 vs. 65 vs. 70).
✅ Use pension income splitting with your spouse.
✅ Convert RRSP to RRIF by age 71.
✅ Watch for OAS clawback ($90,997 threshold for 2025).
2. Key Tax Deadlines for 2025
February 28, 2026 – T4 slips issued to employees.
March 1, 2026 – RRSP contribution deadline for 2025 tax year.
April 30, 2026 – Personal income tax filing deadline.
June 15, 2026 – Self-employed individuals’ tax filing deadline (payment still due April 30).
Throughout 2025 – Quarterly tax installment deadlines for those required (March 15, June 15, September 15, December 15).
Missing these deadlines can result in penalties and interest, so build reminders into your tax plan.
3. Case Study: Tax Planning for a Canadian Family in 2025
Let’s take a closer look at how a typical family can save money through careful planning.
Scenario
John earns $95,000/year (employee).
Maria earns $45,000/year (self-employed consultant).
They have two children (ages 6 and 12).
They pay $8,000/year in childcare for the younger child.
Family medical expenses total $4,500.
They are saving for retirement and a future home renovation.
Step 1: Income & Deductions
John contributes $15,000 to RRSP, reducing taxable income to $80,000.
Maria contributes $5,000 to RRSP, reducing income to $40,000.
Maria claims home office deduction = $3,000.
Net taxable incomes:
John: $80,000
Maria: $37,000
Step 2: Tax Credits
Childcare Expenses: $8,000 claimed by lower-income spouse (Maria).
Medical Expenses: Claim under Maria, since 3% of $37,000 = $1,110 (lower threshold than John’s).
Deductible = $4,500 – $1,110 = $3,390.
Basic Personal Amount (BPA): $15,000 each.
Canada Child Benefit (CCB): Approx. $5,000–$6,000 based on combined income.
Step 3: Outcome
RRSP contributions save about $8,000 in taxes.
Medical and childcare claims save $3,500+.
CCB adds an extra $5,000+ in tax-free income.
Total family savings: $16,500+ compared to doing nothing.
4. Month-by-Month Tax Planning Roadmap for 2025
Here’s how you can spread tax planning across the year instead of scrambling at the last minute.
January – March 2025
Contribute to RRSP early.
Review TFSA contribution room.
Organize prior year’s receipts (medical, charitable, tuition).
April – June 2025
File 2024 tax return by April 30.
Make 1st and 2nd installment payments (if required).
For business owners: plan summer purchases to maximize deductions.
July – September 2025
Mid-year review: Adjust RRSP/TFSA contributions if behind.
Consider prescribed rate loan strategy if income splitting is possible.
Harvest losses in investments to offset capital gains.
October – December 2025
Final charitable donations for 2025.
Accelerate medical or childcare expenses (pay before year-end).
Consider selling investments with capital losses to apply against gains.
For businesses: purchase needed equipment before December 31 to claim CCA.
5. Finally
Tax planning for 2025 in Canada is not just about compliance—it’s about strategy, foresight, and consistency. Whether you’re an employee, self-employed, a retiree, or a business owner, proactive planning can help you:
Keep more money in your pocket.
Optimize your savings and investments.
Ensure you’re compliant with CRA requirements.
The real secret? Start early, review regularly, and adjust as needed.
By following this guide’s step-by-step approach, you’ll be positioned to reduce taxes, build wealth, and achieve financial peace of mind in 2025 and beyond.