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Important Tax Changes for Planned Gifts

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Up until January 1, 2016 trusts created in your will, called testamentary trusts, had a distinct advantage as earnings in the trust were taxed at graduated rates. A graduated tax rate is how an individual’s income is taxed – lower rates at lower income levels with tax rates increasing as the level of income reaches higher thresholds. This advantage was so attractive, wills often contained instructions to create multiple testamentary trusts to reduce the tax load on their beneficiaries. For example: A Saskatchewan taxpayer paid a combined federal and provincial tax rate of 8.9% on taxable income of 20,000 in

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