So Why Are Hutterite Colonies Able to Split Their Income But Private Business Owners Have TOSI? Mismatched Socks Tax Policy

There’s an irony in Parliament’s reasoning for section 143: it enables income splitting because members own no personal property at all – no individual claim, no individual profit to tax. Flip that onto the Apples and it points the opposite way. Mr. Apple isn’t propertyless: Ontario’s Family Law Act already treats marriage as an economic partnership, entitling a spouse to an equalization of net family property – including growth in a business like BakeryCo – regardless of who ran it. But tax law treats his dividend as abusive income splitting, taxable at the top rate, regardless of what family law says about his stake in the business.

And through it all, the Hutterite rule was written into TOSI’s own exclusions on purpose. Buried in the split-income definition Parliament carved out any trust “deemed to be in existence by subsection 143(1)” and let colonies stay exempt, even before the 2018 amendments. Call this the “black sock”.

Our federal government also lets spouses split pension income with no test of the recipient’s own effort – nobody asks a retired teacher’s spouse to prove she was “actively engaged” first. Add that to the colony rule and matrimonial property law, and a pattern emerges: Parliament has repeatedly recognized that income earned inside a shared economic unit doesn’t always belong to whoever’s name is on the cheque. A colony is a shared economic unit. So is a pension-splitting couple. So is a small business run by two spouses, one active and one not.

Yet one group gets formula-driven splitting with no strings attached. The other – risking the family’s capital – gets the harshest treatment via TOSI.

That’s not principled tax policy. That’s a sock drawer nobody’s checked in decades – one deliberate quirky sock from 1977, and one rushed, mismatched sock from 2018, sitting side by side, nobody bothering to look down.

Being deliberately quirky, like my old classmate, meant someone thought about it. Being accidentally mismatched, like my young relative, just means you were in a hurry and nobody caught it. Forty years on, our tax system is still getting dressed in the dark.

A proper review and reform of the Act – one that looks at all the socks at once, not just whichever foot is cold that year – would restore fairness.

I love Hutterite vegetables and other farm-fresh goodies as much as the next person. I feel the same about my neighbourhood family bakery. I just wish I could buy the Apples’ bread and pastries knowing their family got the same tax treatment as the colony gets for its carrots and meat sales.

It’s time to get dressed with the lights on.

Leaders, Are Your Messages Inconsistent?

Unfortunately, I’ve often dealt with leaders throughout my life who say one thing but their actions are completely inconsistent.

I recall a specific “leader” who preached honesty and kindness at every opportunity – it was practically his personal brand. However, behind the scenes, he was ruthless and, as I eventually learned, dishonest. I caught him in a blatant lie. When I called him on it directly, there was a long silence on the phone – the unmistakable sound of someone realizing he’d been caught. Then, instead of owning it, he kept lying, layering on excuses that made things worse, not better. The cover-up told me more about his character than the original lie ever could.

That’s the pattern worth naming: leaders whose words and actions don’t match. They say “honesty matters” and then lie the moment it’s inconvenient. They say “I value my people” and then throw them under the bus the moment it’s politically useful. The words cost nothing to say. The actions are the only real evidence of character, and eventually the two get compared – usually by the people who trusted the words most.

The lie itself often isn’t the worst part. It’s what happens in the moment right after you’re caught. A leader with real character says, “You’re right, I wasn’t straight with you, here’s why, and I’m sorry.” A leader without it doubles down, deflects, and manufactures a story on the spot – and in doing so, reveals exactly who they are.

We don’t need more leaders who are polished in what they say. We need leaders whose actions match their words, consistently, especially when nobody’s checking and especially when they think they can get away with it.

That’s not a soft skill. It’s the entire foundation of whether anyone should follow you at all.

Public Debt Charges Calculator

On July 20, 2026, the Parliamentary Budget Officer released an update to a simple tool that it has provided since 2022 to help calculate public debt charges whenever the federal government proposes new revenue or spending measures. There are two inputs into the calculator: how much is the measure expected to increase taxation revenues? And how much is the measure expected to increase spending? Once those two inputs are completed, it calculates what the increase or decrease will be in public debt charges using a bunch of assumptions that are displayed for the user’s benefit.

Tools like this can be very useful to help a person understand how government programs are financed along with its related debt costs. In other words, government programs come with real costs – they aren’t simply provided using pixel dust.

I’d encourage you to review this tool and share it with your friends. The more Canadians understand basic financial concepts and can increase their financial literacy, the more informed they will become which can assist them in making better personal decisions and those at the ballot box.

Bonus Comment – From Ralph Waldo Emerson – American Author and Essayist – About Leaders’ Actions Speaking Much Louder Than Their Words

“What you are stands over you the while, and thunders so that I cannot hear what you say to the contrary.”

Exactly. Your actions will eventually drown out your words – for better or worse.

Money Sayings: The Phrases Running Your Financial Life

Money sayings can quietly shape fear, spending, and self-worth. Use Garrett Gunderson's Money Language Audit to question old phrases and choose a better rule today.