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Investment Q&A

Not investment advice or solicitation to buy/sell securities. Do your own due diligence and/or consult an advisor.

Q: in doing taxes for cap gains and losses in $USF and conversions, can one use the average exchange rate for the year(2017... 1.2986) or does one have to convert individually for each trade?
at the then exch rate?
Read Answer Asked by george on March 05, 2018
Q: This is a follow up on my earlier question on tax loss selling for Enbridge:
1) Aqn. I like it but is it really an equivalent of Enbridge? I can see how Trans canada could be, because it is pipe lines. But, I don't think Algonquin has pipelines. So, I imagine you are saying that it is not an exact replacement but close enough. Am I correct?
2) I am not great with calculations and would like to know how you calculate the 21 per cent that you mention. You speak about a high tax rate. What do you consider a high tax rate. It looks like 20 per cent here. Is that right?

thanks again
Read Answer Asked by joseph on February 27, 2018
Q: Hi 5i: Just a suggestion in relation to Elaine’s question about dealing with large embedded capital gains in a taxable account. If you are someone who makes charitable donations anyway, consider giving some of your highest percentage capital gains away by donating the shares instead of cash. For your own tax deduction purposes you get a tax receipt for the full value of the donated shares (capital gain included) but you don’t have to pay the tax on the gain to do it. An organization called CanadaHelps is worth checking out online as a facilitator. Before the New Year I was able to transfer a bunch of my PUR shares to them (after the takeout bid!), specify that I wanted the donation split in 12 different directions, and select the 12 different charities to receive individual donations equivalent to specific numbers of the shares. It was relatively easy for me given all the administrative work they looked after. And I got a bigger tax receipt than I would have if I had sold the shares, paid the tax, and donated the leftovers.
Read Answer Asked by Lance on February 21, 2018
Q: I understand you can't sell a stock for a Capital Loss and buy it again within 30 Days in any sort of account whether it be Cash, RSP, TFSA.
Can you do the opposite and Buy new shares in RSP first to take position then sell the same companies shares in Cash Account for Capital Loss?
Read Answer Asked by Craig on January 19, 2018
Q: Can Americans sell up until the end of the year for tax purposes without having to worry about settlement date falling into the same year. Thanks
Read Answer Asked by george on December 29, 2017
Q: First of all Merry Christmas and Happy New Year to the 5i team and all my fellow subscribers.

My question relates to where should I invest (RRSP vs TFSA vs Non Registered).

I am 53 yrs old and plan to retire in the next 12 yrs. My current investment portfolio is virtually 100% in RRSPs. My goal is to build a strong dividend portfolio of Canadian stocks coupled with an International and Bond ETF. My question is where should I keep my investments? RRSP? TFSA? or Non Registered?

I am entering my peak earning years and feel that I can retire comfortably on approx. 70% of my current income. I see potential benefits in all 3 but not sure where I should keep my investments. I will likely be at a lower tax rate than I am now than when I am ready to withdrawal from my RRSP. However, who knows what will happen with tax rates. As well, income from my RRSP (but not my TFSA) would impact my OAS clawback.

Any suggestions would be greatly appreciated.
Read Answer Asked by Nick on December 27, 2017
Q: I trade with CIBC and recently they reduced their settlement days from 3 to 2. In this case what would be this year's final stock sell day to qualify for tax loss selling? I assume it would mean December 28 for 2017. Am I right?

Thanks.
Read Answer Asked by Victor on December 21, 2017
Q: If I sold shares on Nov 22 (settlement date Nov 24) and realized a capital loss can I buy the shares back on Dec 21 as the settlement date is after Dec 24th?
Read Answer Asked by stephen on December 20, 2017
Q: TFSAs and RRSPs. Are you able to sell a stock one day, and rebuy the next, or is there a waiting period as in non-registered accounts.
Read Answer Asked by Brad on December 15, 2017
Q: Good Morning Peter, Ryan, and Team,
Tax loss selling season is coming to a close for 2017.
In your opinion which company(s), within the Balanced Equity Portfolio, appear to be sold down unnecessarily as a result of tax loss selling ???
To me GUD, WCP, CLS, and GC appear to be candidates. A company outside of the BE Portfolio that has really been thrashed is PEY although the gas market in Canada is brutal right now.
Thank you very much for your sage insights. DL
Read Answer Asked by Dennis on December 13, 2017
Q: I am an Alberta resident and in a low (15% federal rate) tax bracket and have the option of placing my $US investments in my TFSA or a regular investment account. Recognizing the 15% US withholding tax but also the foreign tax credit against Cdn tax owed, which account is preferable from a current income perspective?
Read Answer Asked by Jim on December 11, 2017
Q: Just a comment on Earle’s post on Friday on the 30 day waiting period on capital losses and being able at least to adjust your cost base. I am an “active” investor, which is a polite way of saying I trade a lot. I am not recommending that for all but here is my approach to taxes. I really don’t pay much attention to the 30 day rule during the year. If I sell a loser and change my view in a week or so due to new information, I will buy it back right away so as not to lose potential upside on that stock. At year end, I get my detailed trading statement. When I am calculating my capital gains/losses for the year, I check each losing security to see if I bought it back within the 30 day window. If I did, I just don’t claim the loss. For me, missing a taxable capital loss feels a lot better than missing the opportunity to get back onboard a stock on day 10 or 15 if my view has changed rather than waiting for day 30 to pass. I agree with Earl that taxation should always be secondary in your investment decisions.
I assume my approach is fine with CRA as I do not try and claim my capital losses if they are not past the 30 day window. Your views are appreciated.
Thanks again,
dave
Read Answer Asked by Dave on December 11, 2017