It might surprise Canadians to know that mortgages can be tax-deductible, if they are willing to do some legwork.
The idea isn’t new in Canada. It’s best known as the Smith Manoeuvre, named after the Victoria resident and financial strategist Fraser Smith who popularized it in his book appropriately called, The Smith Manoeuvre.
“A Canadian mortgage is a very expensive debt,” says Michael Puccini, a mortgage consultant with Premiere Mortgage Centre in Halifax. “You have to service that with after-tax dollars.”
The traditional way of paying off a mortgage quicker was to go with bi-weekly payments, says Puccini.
“We’re saying to clients there’s a different way of doing this.”
This is where the Tax Deductible Mortgage Plan (TDMP) comes in. Puccini says the plan allows you to create tax refunds, pay off your mortgage faster and build wealth for retirement.
