'dem tax changes

How about ‘dem capital gains changes?

Is there anything good in the budget. No.

Does it hurt all business owners across Canada, absolutely.

How much our government is lying to us daily now – it’s bordering on the Cold War.

But, it all means we have more work to do, and unfortunately (or fortunately, depending on who you are), it means more fees and more insurance.

I have more to say on this later, but first an advertisement for one of my friends.

I literally just got off the phone with a friend who has moved companies and he’s got a super interesting offer for my insurance horde and here it is:

He works for a newish insurance fintech firm and they are looking for Advisors in Ontario (rest of the country to come). They will pre-book your schedule with qualified leads (its actually legit) and you simply need to close the insurance deals. They will put in 15-20 meetings weekly with people wanting to buy insurance.

You get 50% of the FYC and bonused at 170%. There can be a draw in month 1 of $4,000. But, you’ll be expected to do $4,000 of annual premium each week. If you do, you’ll be at $150,000+.

It’s so lucrative, I almost took the job myself.

I know this all sounds too good to be true, but I’ll tell you, it’s possible.

It’s completely virtual, but you have the chance to not only help a bunch of Canadians buy insurance, but probably make some serious bank.

You can do insurance in your own market, where the split is different. But if you have a mutual fund block, it won’t work. You’ll be too busy selling insurance.

If you’re intrigued, send me a message and I’ll connect you with my friend.

Let’s get back to this incoherent budget.

Here’s what I’ve told people who asked me: just don’t do anything. Pretend it doesn’t exist, it’s not final and it’s not law yet. The government expects you to overreact. The dunces down at Finance Canada really think we are lambs to be slaughtered. They think they can do whatever they want.

Anyways, you know all of this already.

But, there are people that unfortunately need to sell.

For example, I was recently working on a case for a widow and her husband passed away with $8,000,000 of BMO stock she never knew he owned. She is sick herself and could pass away before year end and she’ll get caught up on these new rules. Turns out he loved BMO and just kept on buying the stock and living on the dividends.

Or, the 90,000 doctors who use capital gains and now might decide to move to greener pastures.

Or, the 400,000 Canadians who own cottages….the list could go on.

A few weeks ago, I talked about corporate insured annuities, and I’d bone up on that, which is one way to completely eliminate the capital gains inside a corporation, especially if they want a nice income stream guaranteed at today’s rates.

And I know you read this newsletter for innovative solutions, which just happens to be my bread and butter.

So, here’s a non-traditional one, but I think can work under these new rules.

If you have someone with a bunch of personal assets cash or investments. You might never have considered this, but you could actually contribute those assets to a corporation (roll them as the accountants say) and invest in the corp and then freeze the shares.

Now, it can’t reduce the current capital gains (if there are any), but it could help shelter future gains if a future government messes around (probably a 100% guarantee here, when one of Justin’s sons is the future Prime Minister circa 2054).

You might do this so that future capital gains won’t be triggered in this person’s life, only the current capital gain.

Here’s how it works in practice.

Let’s assume you had $5,000,000 of assets. Over the next 30 years, those assets would grow to $28M (at 6%) and then a capital gain is paid on the death – under the current rules, that would be $8M at current rates.

Instead, if they flipped those assets to a corporation and froze the shares, in 30 years, they’d still have the same value of $28M, but on the person's death, nothing happens because all the growth shares are owned in a family trust going to the next generation.

Now, I’ll agree. We rarely see people with personal assets contribute them to a corporation and then freeze the shares. It’s non-traditional. But, that doesn’t mean it doesn’t work. It does. People just don’t do it very often.

But, I’ve seen it work.

Listen, I get it. This is niche for the right person. But, you need to be innovative when the government squeezes out the air for these business owners and there are opportunities.

Another thing to do, for those that are scared. Buy some term insurance, some carriers sell term 5 to cover any kind of gap in the meantime if this thing actually passes. It’s stupid we have to do this all, but those are possible solutions.

If you aren’t doing this already, you should plan on asking your client’s accountants for updated Terminal Tax Liability (TTL) calculations.

And finally, I wanted to share a story with you.

I have a friend who has a fledgling business. He worked for a company before and then started doing what he was doing there, but for his own company. And, unsurprisingly, he’s grown it within a few years to earning about $500K+ each year.

He’s not so up to speed on the finances and stuff like a normal business owner. But we got into this discussion about the word “no.”

I told him, sometimes it’s more important to say no than to say yes. When you say no, to the right people of course, it defines your business, but it also establishes credibility and exclusivity.

I told them the story about an online marketer I know. He has a monthly program, but if you cancel your membership (which he has no problem doing), he will never let you in again. You cancel and it’s a lifetime ban. There are plenty of reasons for this. But, essentially, it’s all about cultivating the clientele you want and repelling those you don’t.

If you aren’t already doing this, you should. Some clients are just poison. They will ruin your business and your life essence.

Cut them dry and attract the people who like you and will pay you.

On that note, have a great weekend,

Andrew

p.s. I’m working on a new course about building strategic partnerships to attract your ideal clients and essentially fill your calendar with those that you want. I’m starting a short list, so send me a message if you want to be added to it.

p.p.s. What the heck are the Atlanta Falcons doing, are they pulling a Green Bay. Some tension brewing in the NFC South.