-   Scotiabank tax expert also offers tips to make tax savings a year-
        round priorityTORONTO, March 2 /CNW/ - As RRSP season winds down with today's
contribution deadline, many Canadians are turning their attention to their
taxes and, if eligible, thinking about what they'll do with their tax refund.
Nearly one-quarter of Canadians (24 per cent) plan to save their refund by
either depositing it or reinvesting it, while one-fifth (21 per cent) say they
will use it to pay off debt, according to a recent Scotiabank poll to find out
how Canadians intend to spend their income tax refund. A further one-fifth of
Canadians (20 per cent) don't expect to get an income tax refund at all.
    The poll, conducted by Harris/Decima for Scotiabank, shows that Canadians
living in British Columbia are the most likely to deposit or reinvest their
tax refund (32 per cent) followed by 28 per cent in Ontario, while those
living in Alberta are the most likely to pay off their debt (27 per cent).
    "In today's environment, it's great to see that so many Canadians are
thinking about how they can make the most of their tax refund," says Adam
Salahudeen, Senior Manager, Tax Advisory Services, Scotia Private Client
Group.
    For those who are uncertain about whether they should deposit or reinvest
their tax refund or pay down debt, Mr. Salahudeen counsels that there has
never been a more important time to review or build your financial plan: "Talk
to your advisor and get your concerns out on the table so that they can help
you determine the best course of action for you and your family."
    Whether you ultimately decide to deposit/reinvest or pay down debt, Mr.
Salahudeen encourages Canadians to file their tax returns early so they get
their refund back as quickly as possible, thereby accumulating or saving as
much as a month and a half of interest.
    The study also found that eight per cent of respondents said they would
go shopping/buy things, while five per cent said they would use their refund
to go on a vacation and four per cent said they would do some home
renovations.
    "If you're thinking about an 'enduring' renovation such as a kitchen or
bathroom, and you can afford the expenditure, this is the year to do it.
Effective January 28, 2009 until January 31, 2010, Canadians can take
advantage of a 15 per cent non-refundable tax credit on renovation costs in
excess of $1,000 up to $10,000. This measure will provide tax relief of up to
$1,350," Mr. Salahudeen explains.
    In addition to the Temporary Home Renovation Tax Credit, Mr. Salahudeen
offers a number of other planning strategies Canadians can explore in an
effort to reduce taxes for next year and beyond.

    Tax loss selling opportunities. If the capital losses in your investment
portfolio this taxation year exceed your gains, the net capital loss can be
deducted against any capital gains. You are also permitted to carry back net
capital losses to the preceding three taxation years and carry them forward
indefinitely, which provides you with some tax planning opportunities.

    Maximize RRSP contributions. Your RRSP remains one of your most powerful
tax breaks. Not only do you receive a deduction for the contribution you make,
the earnings in your plan compound tax-free. To get the most out of your RRSP,
consider "paying yourself first" by setting up a regular investment plan,
which will help you maximize your refund for next year.

    Open a Tax-Free Savings Account (TFSA). The new TFSA provides another
opportunity to save money and have it grow tax-sheltered like an RRSP with the
flexibility of a savings account. A TFSA can be opened at age 18 and you can
save $5,000 each year. All investment income earned inside the TFSA (capital
gains, interest, dividends) are tax free for life. Unused contribution room is
carried forward indefinitely, amounts withdrawn top up future contribution
room and the account can be kept for a lifetime.

    Splitting pension income. Individuals who earn income eligible for the
pension income tax credit can reduce their overall household tax bill through
pension income splitting. For people age 65 and older, eligible pension income
includes lifetime annuity payments under a registered pension plan (RPP), a
registered retirements savings plan (RRSP) or deferred profit sharing plan
(DPSP).

    Claim all your credits. These range from medical expenses, one of the
most under-used tax breaks, to education expenses, charitable donations,
transportation and age and pension credits.

    Make sure you take all eligible deductions. In addition to your RRSP
contribution there are many other deductions you may be eligible for such as
moving expenses, deductions for the self-employed, childcare expenses, and the
non-refundable tax credit of up to $500 for each child under 16 registered in
an eligible program of physical activity.

    "If you have ever considered getting professional tax advice, this is
definitely the year to consult a qualified tax accountant who can help you
ensure that you are taking advantage of all available tax credits and
deductions," counsels Mr. Salahudeen.

    The Scotiabank Income Tax Refund Poll was conducted for Scotiabank by
Harris/Decima via a national telephone omnibus survey among a representative
sample of 1,020 Canadians. The survey was conducted February 12 to 15, 2009.
The survey responses are considered accurate to within +/-3.1 percentage
points (19 times out of 20).

    Scotiabank is one of North America's premier financial institutions and
Canada's most international bank. With more than 69,000 employees, Scotiabank
Group and its affiliates serve approximately 12.5 million customers in some 50
countries around the world. Scotiabank offers a diverse range of products and
services including personal, commercial, corporate and investment banking.
With $508 billion in assets (as at October 31, 2008), Scotiabank trades on the
Toronto (BNS) and New York (BNS) Stock Exchanges. For more information please
visit www.scotiabank.com.