Academy of Financial Divorce Specialists

07/31/2026

How Experts Choose the Right Tax Rate for Your Net Family Property & the Risk from getting it wrong. What Professionals must know - Part 2

By Paul Beck, CFP, FMA, CFDS nocourtdivorce.ca Hamilton, ON
https://www.facebook.com/share/p/14jx3bVMF27

How Professionals Choose the Right Tax Rate for Your Net Family Property - Part 2

Once you understand the difference between marginal and average tax rates, the next question is: Which one should be used for your Net Family Property calculation? The answer depends on your financial picture, your retirement plans, and how likely you are to withdraw funds gradually versus in large amounts.

Why Many Professionals Prefer an Average or Blended Rate
Although the marginal rate is simple, it often overstates the tax people actually pay in retirement. Most individuals withdraw from their RRSPs slowly, stay in moderate tax brackets, and benefit from credits that reduce their effective tax burden. Because of this, many financial professionals use an average rate or a blended rate—something between the average and marginal rate—to better reflect real‑life outcomes.

A blended rate might fall in the 22–28% range for a typical Ontario household, though this varies widely depending on income, age, and retirement plans.

Factors Considered When Choosing a Rate
Professionals look at several elements to determine a fair and defensible estimate:

Expected retirement income from all sources

Size of the RRSP

Whether withdrawals will be gradual or lump‑sum

Your overall financial picture, including pensions and investments

The goal is not to predict the exact tax you will pay decades from now. Instead, it’s to choose a reasonable estimate that reflects how taxes are likely to be paid based on your circumstances.

Why This Matters for Your NFP
The tax rate chosen directly affects the after‑tax value of your RRSP or investments:

A higher rate lowers the value of the asset
A lower rate increases it

This can influence equalization payments and the overall division of property. Understanding the reasoning behind the chosen rate helps you feel confident that your NFP reflects a fair and realistic picture of your financial future.

07/29/2026

Kevin Wark, LLB, CLU, TEP, Integrated Estate Solutions & CALU, FORUM magazine

What if some of the biggest tax planning opportunities for small business owners aren't the headline changes, but the ones buried deep within Bill C-15? 💰💡

In his latest article for FORUM Magazine, Kevin Wark, LLB, CLU, TEP, Managing Partner of Integrated Estate Solutions and a tax advisor to CALU, highlights several important legislative changes that advisors should understand when working with incorporated business owners.

Kevin explains that while Bill C-15, the Budget Implementation Act, 2025, No. 1, received royal assent on March 26, 2026, "buried within its many pages are a number of golden tax nuggets for private business owners and their professional advisors."

Among the changes he explores are:

✅ The increase to the Lifetime Capital Gains Exemption (LCGE) to $1.25 million, applying to share dispositions after June 25, 2024, with indexation resuming in 2026.

✅ The extension of the capital loss carry-back period to capital losses realized within the first three taxation years of an estate for deaths occurring after August 11, 2024.

✅ Changes to the stop-loss rules, including a special rule that reduces the denied loss amount by 50 percent when shares are transferred to the deceased's GRE and redeemed within the estate's first taxation year.

✅ The expansion of the small business rollover, allowing eligible business owners to defer taxation of capital gains when proceeds are reinvested in another eligible corporation, with expanded timelines and qualifying share types.

✅ Enhancements to Employee Ownership Trusts (EOTs) and workers' co-operatives, including the extension of the shared $10 million capital gains exemption to qualifying workers' co-operative sales.

✅ New trust reporting exemptions, including expanded relief for certain family trusts holding qualifying assets of up to $250,000 where all trustees and beneficiaries are related individuals.

For advisors working with incorporated clients, these legislative updates could create valuable planning opportunities while reinforcing the importance of staying current on evolving tax rules.

Read Kevin's full article in the latest edition of FORUM Magazine for a detailed breakdown of what these changes could mean for your clients. https://bit.ly/4gRVlym

07/19/2026

Your $200,000 RRSP may not be worth $200,000 in a Net Family Property calculation.

Paul Beck, CFP, FMA, CFDS, nocourtdivorce.ca explains:

Why RRSPs and Investments Are Adjusted for Tax in Your Net Family Property- Part 1

When you’re going through a separation, one of the most confusing parts of preparing a Net Family Property (NFP) statement is seeing your RRSP or investments listed at an “after‑tax” value. This isn’t a penalty but it’s simply a recognition that some assets will trigger income tax in the future, and family law aims to reflect that reality when dividing property.

RRSPs are fully taxable when withdrawn, and capital gains on investments are partially taxable when sold. Because these taxes will eventually be paid, professionals must estimate what that future tax might look like. Two methods are commonly used: the marginal tax rate and the average tax rate. Understanding the difference helps you make sense of how your assets are valued today.

Marginal Tax Rate
Your marginal tax rate is the rate you pay on the next dollar of income. It represents your highest tax bracket.

If your marginal rate is 30%, every additional dollar earned is taxed at 30%.

Some professionals use this rate because it’s simple and reflects the maximum possible tax on RRSP withdrawals.

But this method assumes you withdraw a large amount all at once and that every dollar is taxed at the highest bracket. Rarely, that matches how people actually use their RRSPs.

Average Tax Rate
Your average tax rate is your total tax paid divided by your total income. Because income is taxed in layers, your average rate is always lower than your marginal rate.

For many retirees, average rates fall closer to 15–30% because:

Withdrawals are spread out over time

Retirement income is usually modest

Tax credits reduce the effective tax paid

Income sources like CPP, OAS, and pensions keep people out of the top brackets

Why This Matters
Using a higher marginal rate reduces the after‑tax value of your RRSP. Using a lower average rate increases it. Neither method is “right” or “wrong”—the goal is fairness and reasonableness.

Part 2 explains how professionals choose the right rate for your situation and how this affects your final NFP.

07/19/2026

Millennials Aren’t Falling Behind After All. This Data Reveals the Generation’s Deeper Problem.

by Reshma Kapadia, Barron's Oct. 2024
Graphics: Molly Cook Escobar,
Top chart: Data from Rob Gruijters, quantitative sociologist, University of Bristol in England.
Photographs: David Payr (Dunyak), Evan Jenkins (Davis), and courtesy Saba Dilawari.

Due to Canadian censorship the link gets blocked so type in without the spaces:
https:// www . barrons . com / articles / millennials-generation-wealth-gap-economy-49bf2e3a

07/19/2026

Millennials Aren’t Falling Behind After All. This Data Reveals the Generation’s Deeper Problem.

by Reshma Kapadia, Barron's Oct. 2024

Graphics: Molly Cook Escobar,
Top chart: Data from Rob Gruijters, quantitative sociologist, University of Bristol in England.
Photographs: David Payr (Dunyak), Evan Jenkins (Davis), and courtesy Saba Dilawari.

Millennials, once-dubbed the unluckiest generation, is one of the most economically divided, a Barron's analysis found.

07/15/2026

Millennials Aren’t Falling Behind After All. This Data Reveals the Generation’s Deeper Problem.

by Reshma Kapadia, Barron's Oct. 2024
Graphics: Molly Cook Escobar,
Top chart: Data from Rob Gruijters, quantitative sociologist, University of Bristol in England.
Photographs: David Payr (Dunyak), Evan Jenkins (Davis), and courtesy Saba Dilawari.

Millennials, once-dubbed the unluckiest generation, is one of the most economically divided, a Barron's analysis found.

07/09/2026

The Value of the Stay-at-Home in 2024

Study quantifies the value of stay-at-home parents by analyzing the amount of time they dedicate to performing their tasks and the price of outsourcing them in 80 cities around the world.

Exploring the critical role and immense value of stay-at-home parents in today's fast-paced world. Understand the economic and emotional impact of parenting at home in 2024.

07/08/2026

Man wanted 5K in damages from ex-romantic partner over phone number
They were in a -like relationship and separated in July 2024.
One phone number was used by the man for his business, but after their , the account remained in the woman’s name.

by Sandor Gyarmati, Delta Optimist

The man had the onus to prove his counterclaim but had not done so, the tribunal ruled

07/06/2026

Mio Wakita is a holding a Bachelor of Economics (B.Econ.), Certified Financial Planner (CFP®), Chartered Investment Manager (CIM®), and CFDS® designation.

Ms. Wakita provides Financial Planner services in Calgary, Alberta with TD bank / TD Wealth .

Congratulations to Ms. Wakita who graduated as a Chartered Financial Divorce Specialist in January 2026.

07/04/2026

More are waiting until 70 to start their CPP

by Roma Luciw, Journalist, The Globe and Mail

(Meta blocks direct links Canadian content on Facebook)

At long last, more Canadians are waiting until 70 to start their CPP pensions. See link in comments.