Each year Canadians make an interest-free loan to Canada Custom and Revenue Agency (CCRA) of about 12 Billion dollars!

Are you one of them?Chances are that you if you file an Income Tax return and receive a refund - then you are.

CCRA collects about $100 billion plus each year through the income tax.If they have to give 12 billion dollars back in refunds then that means that 12% of that money that they collected was not theirs to begin with.

Remember a refund is not a gift from the government; it is a return of your own money!So how can you reduce your withholding taxes?

Here are two strategies:

First, review your TD1 form.This is a form that you filed with your employer when you were hired for your job.

Outdated data that could affect the amount of withholding taxes:If for example you were single and are now married with children, this one change alone could provide you with a significant reduction at source.So, investigate and make the corrections if applicable.

Second, whether you pay source withholdings (as with an employer) or in installments (as in the case of self-employment or retired), you can apply to your local CCRA office to allow you to reduce your withholding tax for deductions not covered by the TD1 form.

Examples of these deductions are: RRSP contributions, medical expenses, charitable contributions.Request a waiver form from CCRA and give it to your employer so that he/she will be released from the responsibility of reducing your payroll tax and you will end up with a bigger take home pay cheque.

These two strategies alone could allow you to have your tax savings now to spend and INVEST as you see fit.

Remember a refund is nothing more than the return of your own money!

This one adjustment in your finances could help you to pay off your mortgage years sooner or retire much earlier and with more income.

To learn how you can invest these savings at 10% or higher annually and start enjoying a financially free and independent lifestyle sooner rather than later, please call or email me at my phone or email address.

Yvonne Finn provides accessible and usable financial information, education, services and products to fellow Canadians who want to get out of debt, learn to invest efficiently and protect their assets for themselves and their heirs.She believes each client is unique and requires and deserves one-on-one customised consultation.Call at: 647-281-5074 or E-mail

Figuring Out Your W-4 Withholdings
If you are employed by a business, you have the ability to play with the withholding on your paycheck. Fortunately, there is an easy way to do this online these days.What is one of the happiest days of the year? Holidays excluded, for many people it ...

Corporations Failing To Claim AMT Exemption Overpay Taxes By $11,000
Does your incorporated business pay alternative minimum tax [AMT]? If so, there is a 93% chance you have been overpaying your taxes by an average of $11,000 a year according to the Treasury Inspector General.The Office of the Treasury Inspector Gener...

New Tax Rules for the Poor
New tax rules for 2007 will bring about a good year for the poorest of tax-filers in Maryland. Tax-filers can now earn up to $37,000 and still be entitled to the Earned Income Tax Credit that will put more money in their pockets this year than it did...

How Taxes Apply To A Partnership Company
A partnership agreement is made between two or more partners, who mutually agree to set-up a business or become a part of it after the business takes off. All the parties entering a partnership deed become the owners of the company, and hold the powe...

Filing Quarterly - Making Quarterly Tax Payments
Who is Subject to Paying Quarterly?Everyone, in essence. Individuals whose tax obligation for any year exceeds $1000 need to make payments on those taxes due throughout the year. Most of us do without realizing it. If you are an employee at a regular...

Tax Deductions The First Time Home Buyer Can Expect
What You Can Expect From Your New HomeWhen one acquires his or her first new home, there is great expectation of a new income tax deduction. This expectation exists for both single folks and married couples as they wander into the new world of itemiz...

Tax Refunds: How Do They Work?
The best part about filing your taxes is getting the tax refund check! Chances are, you have been paying your taxes directly, or your employer has been withholding tax dollars from your paychecks. Many individuals overpay on their taxes, so they quic...

IRS Extends Tax Deadlines for Katrina Victims
Following Katrina, the IRS acted quickly to relieve victims of any tax burdens. One step was to extend any tax filing dates to late October and now those dates have been extended again.Emergency Tax Relief ActOn September 23, 2005, President Bush sig...

Tax Refunds-What to Do About Them
You may not think that big tax refunds are a problem-but they can be. If you are withholding more on your paycheck than you get as a refund, then you should consider getting your withholding less and getting smaller tax refunds. The government is u...

Saving Money with Tax Free Medical Plans
Do you have medical expenses that you incur every single year? Do you always use up your entire medical insurance deductible on co-pays?If so, there are a couple of medical saving plan available that would allow you to use tax-free money to pay for ...