Page 22 - Newcom

22 AE 05 2015
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TAX
Protect clients from unwanted CRA scrutiny
X
IMPLICATIONS
OF THE SHARING
ECONOMY
by MICHELLE SCHRIVER, a Toronto-based editor and writer
IF YOUR CLIENTS HAVE TIMESHARES, RENT
out their properties on websites or use their cars to drive paying customers, they need your expertise when it comes to taxes, insurance and estate planning.
Timeshares
A timeshare can be a great way to save on vacation expenses. Most are either fee-simple (your client owns a share of the property) or right-to-use (no actual property ownership). Beyond the one-time property and closing costs, there are ongoing maintenance fees for regular repairs and special assessments for unforeseen repairs, such as those from a natural disaster.
Although a timeshare may make sense for your client’s circumstances, it’s not really an invest- ment, since profiting on a timeshare sale is rare. “There’s just too much inventory out there,”
says Greg Prekupec, a principal at N. Gregory McNally & Associates in Staynor, Ont.
Not to mention that the client could spend 50% of the sale price on marketing, according to the Timeshare Users Group (TUG). (For clients buying or selling timeshares, steer them toward the resale market on TUG2.com, eBay.com or Redweek.com.)
THINKSTOCK