News Releases

TORONTO, ONTARIO--(Marketwired - May 5, 2015) - With today marking the 2014 tax filing deadline, BMO Nesbitt Burns today released the results of its fifth annual tax study which examines how many Millennials (those aged 18 to 34) filed their taxes before the deadline and how they plan to spend the money received from their refunds.

The study found 97 per cent of Millennials have already filed or plan to file their 2014 tax return before the deadline (compared to 98 per cent of Canadians overall). Millennials who have filed and are expecting a tax refund, plan to use their refund to:

• Pay off any outstanding bills and/or reduce debt (37 per cent, compared to 40 per cent of Canadians overall)
• Save and/or invest (33 per cent, compared to 25 per cent of Canadians overall)
• Travel and/or purchase leisure items (16 per cent, compared to 14 per cent of Canadians overall)
• Pay down their mortgage (14 per cent, compared to 9 per cent of Canadians overall)

"Canadians' financial priorities and situations differ depending on their unique needs and goals, but it's encouraging to see that the majority of Millennials who are expecting a tax refund will use their money responsibly to reduce their overall debt and/or save and invest for the future," said John Waters, Vice President, Head of Tax & Estate Planning, BMO Nesbitt Burns.

Tax-Efficient Investment Options

The study also examined the level of familiarity Millennials have in the area of investing and taxes. It found that, when considering new investments, fewer than half (48 per cent) of 18 to 34 year olds regularly seek out tax-efficient investment options.*

A majority of Millennials lack knowledge about the tax treatment of certain types of investment income that can reduce their overall tax liability:

• Fifty-nine per cent do not fully understand how capital gains are taxed
• Similarly, 60 per cent are uncertain how dividend income is treated from a tax perspective

"One of the reasons why young Canadians don't seek out tax efficient investing solutions may be because many do not fully understand how investments are taxed. Awareness is an important first step to being tax smart," added Mr. Waters. "Regardless of your age, ensure you become as familiar as possible with the tax system so you can spot opportunities to reduce the amount of tax owed and determine strategies for next year and beyond. Working with a tax professional or a financial advisor can help determine what strategy is best for you."

Regional Breakdown

Region	Among Millennials who have filed their tax return and expect a refund, % who plan to use their tax refund to pay off any outstanding bills and/or debt (versus all Canadians who have filed and expect a refund)		Among Millennials who have filed their tax return and expect a refund, % who plan put their tax refund towards savings and/or investing (versus all Canadians who have filed and expect a refund)		Among all Millennials, % who are not very or at all knowledgeable about how capital gains are taxed (versus all Canadians)		Among all Millennials, % of who are not very or at all knowledgeable about how dividend income is taxed (versus all Canadians)		% Millennials who seek out tax efficient investment options every/most times when considering a new investment (versus all Canadians)*
National	37/40		33/25		59/57		60/59		48/51
Atlantic	45/42		28/14		63/51		60/50		38/38
Quebec	28/26		34/25		62/60		73/65		52/59
Ontario	49/52		34/23		57/56		57/57		49/50
Prairies	21/30		26/27		65/58		63/55		66/51
Alberta	35/37		30/27		56/58		55/58		44/51
B.C.	37/46		42/37		56/57		51/60		36/45

The 2015 BMO Tax Survey was completed by Pollara between March 26^th and 28^th, 2015, with an online sample of 1,252 Canadians. A probability sample of this size would yield results accurate to ± 2.8 per cent, 19 times out of 20. Data has been weighted by region, gender, and age, based on the most recent Census figures, so that it is representative of all adult Canadians.

* The survey was conducted by Pollara between March 14th and March 17th, 2014 with an online sample of 1,007 Canadians. The margin of error for a probability sample of this size is ± 3.1%, 19 times out of 20.

For more information on tax efficient investing and planning locate a BMO Nesbitt Burns Investment Advisor at www.bmo.com/nesbittburns.

Get the latest BMO press releases via Twitter by following @BMOmedia.