If you felt particularly generous this past Christmas, you may
have transferred money or other property to your spouse or minor
children or grandchildren. Your heart's in the right place, but
the Canada Revenue Agency stands ready to play the Grinch to your
Santa Claus. That's because those gifts can trigger tax rules
that will attribute any resulting income on those assets –
and the tax on it – right back to you. But there are a few
tax goodies left that could help you cut the tax bill.
The so-called "attribution rules" that boomerang tax
liability on transferred property or cash back to you are intended
to curb your ability to split income with members of your family
who are taxed at a lower rate – what the government calls
"abusive" income splitting. Although it seems to be more
abusive to government coffers than to Canadian families.
