Tax Perils of Joint Accounts

Special thanks to Murray Paszko, CFP, FCSI, TEP, Manager, Trust & Estate Services at Servus Credit Union in Edmonton for contributing this article, originally published in a Concentra Trust bulletin on April 11, 2014.

Many people have concerns regarding their estate having to go through probate. As a result, they reregister their assets in joint names, usually with their children as an estate planning strategy. In solving one issue, they may have unintentionally created other consequences, such as tax issues. In some cases, the tax liability on both the original owner and intended joint owner may be more costly than probate itself.

In certain circumstances, CRA views the transferring or re-registering of capital assets, e.g. real estate, securities, etc., from sole ownership to joint ownership, as a deemed disposition by the original owner at the asset’s fair market value at the time of transfer. This is considered to be a sale even though no cash or consideration was exchanged. This could result in an immediate and unexpected taxable event back to the original owner on any accrued gains on the asset. Another concern is not having the cash available to pay the tax.

The person to whom you transfer capital property will also be liable for capital gains tax upon the future disposition of the capital property based on the value of the asset on the date of transfer.   Continue reading “Tax Perils of Joint Accounts”

Weekly Economic Update

In Canada this morning, Housing Starts have increased by 200.1K throughout July, beating economic expectations of 193.0K. Urban Housing Starts gained by 182.9K, while rural Housing Starts measured in at 17.2K. Later this morning, the Bloomberg Nanos Confidence Index will update for the week ending August 8, 2014. The Index most recently measured in at 58.9 which is the lowest level since June of this year. It is quiet south of the border without any economic data on the schedule for today. Releases will pick up again tomorrow, headlined by the Monthly Budget Statement for July.

Following this morning’s update to Housing Starts, focus this week shifts to the Manufacturing Sales data scheduled for Friday, August 15, 2014. After last week’s unimpressive employment data, the Bank of Canada can delay taking an aggressive approach with their interest rate decisions. The Bank of Canada has stated that they are waiting to see continued strength throughout the economy before considering a rate adjustment. The latest update to employment only seems to delay the possibility of a rate increase even further into the future.

There are many important releases scheduled throughout the United States this week. Retail Sales are forecast to increase by 0.2% for July, matching the gain in the previous month. The Import Price Index is expected to decline by 0.4% after a gain of 0.1% in the previous period. On Friday, an update to the Producer Price Index is expected to show an increase of 0.1% for July after gaining by 0.4% in the latest release. The releases this week will all factor into the discussions at the next Federal Reserve Rate Decision, scheduled for mid-September.

In the currency markets, the Canadian dollar has made early gains against its U.S. counterpart following the better than expected Housing Starts data. Currently, it is expected to see the Federal Reserve lead the Bank of Canada in interest rate hikes as we move forward, leading to a weaker CAD versus the USD. Although Governor Poloz has never stated that he wants a weaker currency, it is implied that a lower CAD is required to increase exports to help the economy fully recover. Governor Poloz will maintain his neutral tone until we see continued economic strength over a long period of time, compared to the short streaks of strength followed by disappointing figures that we have been seeing recently.

Todays expected range: 1.0905 – 1.1005

Source: Bloomberg

Posted by Concentra Financial Markets

Spot On With Your Member Needs

481457829Spot, T+1, swap …sounds like a bunch of jargon, right? Maybe. But, a little jargon is necessary and getting to know industry terms such as Spot transactions can help you talk to your members about foreign exchange trading.

A Spot transaction is the exchange of one currency for another and is the most common transaction in the foreign exchange market. For example, if a member executes a Spot trade to sell USD 100,000.00 at 1.1000 she is consequently buying CAD 110,000.00.

Business owners who are buying and selling products in the U.S. require foreign exchanges services such as Spot trading.

Watch this demo video and see how easy it is to execute a spot transaction using the Concentra FX trading system.

Would your credit union like to add foreign exchange services to your menu of offerings? With our industry-leading foreign exchange services and experts, we can make that easy and profitable for your credit union. Find out how by contacting the Concentra FX team or 1-306-566-1747.

Weekly Economic Update

In Canada this morning, the Bloomberg Nanos Confidence Index will update for the period ending August 1st, 2014. The index most recently measured in at 59.7, with a score above 50 suggesting net positive economic views. South of the border, the Markit US Services PMI for July is expected to release at 60.8, down slightly from 61.0 in the previous period. Factory Orders are forecast to increase by 0.6% for the June period after a drop of 0.5% in the latest release.

Focus this week throughout Canada falls on the employment data scheduled to release Friday, August 8th. The Unemployment Rate is expected to stay unchanged at 7.1% while the Net Change in Employment is expected to show a gain of 22.0K for the July period. The job market in Canada remains a key indicator for the Bank of Canada and Governor Poloz to consider when they hold their monthly rate meetings. Governor Poloz has maintained a neutral view of the Canadian economy; however, with continued strength in employment numbers, we could see him shift to a more aggressive tone.

It is a light week throughout the United States in terms of economic data. Headlines will include updates to the Trade Balance and Wholesale Inventories. The Trade Balance is expected to release at -$44.8B for June, slightly lower than the previous release of -$44.4B. Wholesale Inventories are forecast to increase by 0.7% on a month over month basis for June, following a gain of 0.5% in the latest release.

In the currency markets, the Canadian dollar has fallen against its U.S. counterpart in early trading this morning following the release of weak economic data out of China combined with low equity markets and dropping oil prices. The CAD has lost 3% since its July 3rd high. Focus for the CAD this week falls on Friday’s employment data out of Canada. Strong employment data would increase investor confidence leading up to the next Bank of Canada meeting, providing strength to the Canadian dollar, while weak employment data could lead to the currency falling further against the USD.

Todays expected range: 1.0905 – 1.1005

Source: Bloomberg

Posted by Concentra Financial Markets


UPDATE – Concentra staff fundraising to build home in Kenya

In our blog post on March 4, 2014, we shared news of our project to support Mission:180, an organization committed to make a difference in Kenya by building homes for orphans and widows and in working with them to create a future with education and employment opportunities.

In early 2013, we set a fundraising goal of $50,000 to build a Concentra ‘Forever Home’ with the hope to have it fully funded by end of December 2014. Through the support from payroll pledges, jeans days, 50/50 draws, e-bingos, a turkey dinner, and many other activities, so far we have raised $50,735!

Continue reading “UPDATE – Concentra staff fundraising to build home in Kenya”

Harness the Power of Innovation

As the Innovation Manager at Concentra Financial, I am always looking at ways to foster and grow our corporate innovation program. So this past May, I was grateful to attend the Business Innovation Summit in Toronto, hosted by the Conference Board of Canada. I experienced two days of high-profile keynote speakers and smaller interactive presentations focused on accelerating corporate innovation and commercialization in Canada.

I came away renewed, excited, and motivated with what I learned and I want to pass that on to you. Here are some of my key takeaways. Maybe you’ll find something of value that you can share in your credit union.

Continue reading “Harness the Power of Innovation”

Seek tailored solutions with your equipment financing partner

I want to share an article written for Canadian Treasurer Magazine by Hugh Swandel, a prominent expert in the Canadian leasing industry.

Hugh provides an excellent context of the business:

“The right equipment finance company has specialized knowledge of both the equipment used by a company and the financing structure that can address the useful life of the equipment and provide terms of financing that are practical and economical for the client.”

This is the value our commercial equipment leasing services bring to your credit union. Our professionals work with you in meeting the needs of your commercial members seeking tailored solutions for specific equipment-related issues.

You can find the article on page 22. Enjoy.

Terry Wensley, General Manager, Commercial Equipment Leasing

Case Studies in Handling Estates: New eClass using a five-step approach to handling estates

We are pleased to announce a new partnership with CUSOURCE Credit Union Knowledge Network to offer a personal trust-related eClass, a first for Concentra. Our Concentra Trust leading estate expert Joan McAulay has worked closely with the CUSOURCE team to create Case Studies in Handling Estates, specifically designed for credit union professionals seeking to enhance their knowledge and skills in handling estates.
Continue reading “Case Studies in Handling Estates: New eClass using a five-step approach to handling estates”

Expand financing options for your members

At Concentra Commercial Leasing Services, our focus for the past 16 years has remained unchanged. We are not in business to compete with credit unions, but rather to help position credit unions in the marketplace as a full-service financial service provider that offers a competitive lease product.

Our leasing product allows credit unions to offer their members a menu of equipment financing options as well as the greater financial capacity that comes along with sharing the load. Credit union staff and members enjoy a face-to-face relationship, which has long been the hallmark of credit unions, while our leasing staff assist behind the scenes to ensure the “i’s” are dotted and the “t’s” are crossed. It’s a win-win situation.
Continue reading “Expand financing options for your members”