Investment Q&A

Q: I have about 110,000 dollar that I will be investing in your balanced portfolio and the etf ViG. About 45,000 dollars will be in a non registered account and 65,000 in TFSA. I am avoiding RRSP because I have a good pension. My tax person said that I would save tax by putting the non dividend equities to the non=registered account. I plan to leave the investments in for 7-8 year As well will vig be taxed at a higher rate because it is non-Canadian if it is in the non-registered?

Q: Re form 1135. Are US ETF holdings exempt when held in RRIF and TFSA accounts when calculating amounts?

Q: I'm in borderline Top 1% Tax Bracket, so I'm looking for a Flow Thro Fund. The Sprott 2016 Short Duration closed early, run by Eric Nutall. Can you recommend another? And, since I'm maxed out in my RRSP & TFSA, is it ok in a Margin/Cash a/c?

Many Thank

Q: It is time to invest new TFSA money. I wonder if you could rank these six small cap companies for potential growth?
DXD, DBO, IRD, ITC, PEO and TNC.

Thank you

Q: Further to Paul's question on the 15% withholding on US dividends, what is the situation if XYZ was not held in a TSFA? Do we, as Canadians get a tax credit for the 15% withheld or do we just lose it altogether? Henry

Q: Claire had asked a question regarding the purchase of a equity all ready owned (at a profit) with the objective of reducing the cost base. I believe this will only work if you wait the 30 days before selling otherwise you would be in violation of the tax act.

Q: hello 5i:
I'm having a bit of trouble with the specifics of taxation on US dividends, on stocks held within a TFSA. I'll ask it in 2 parts. Perhaps the following example will put this one to bed. If we hold XYZ, a fictitious US company paying a $1 dividend (simplifying as much as possible), then a 15% witholding tax is applied. Correct so far. Now, are the remaining dividends ($0.85/share) taxed again, or are they free and clear?
Part 2: do the US dividends received from XYZ have to be declared in annual income tax reporting?
thanks for your help
Paul L

Q: Hello 5i,
Wishing you a very happy and prosperous 2017. And thanks very much for your advice in 2016—it helped to make that a good year for me and many others.
I need to take money out of my margin account for a purchase. I am thinking of a strategy that sounds vagely illegal but I don’t think it is I haven’t read anything about this anywhere. . I thought I would run it by you.
I have high capital gains in fairly conservative blue chip stocks, such as BNS and BCE. I have been thinking about buying a substantial amount of the same stock at todays price, thus bringing my ACB down substantially and thus reducing my capital gains. Then selling the same amount for the planned purchase. Of course at a substantially reduced capital gain.
I know that there is some risk that the stock could move in the time between the purchase and the sale, but with a stock like this probably not too much. And if it did, I could hold it for awhile. Even if dropped considerably ( probably unlikely) I could make a case for holding it.
It seems like an altogether too easy a way to reduce capital gain taxes and make some money. Am I missing something here?
thanks

Q: I own stock in this company in my TFSA and since they pay there dividends in US dollars, how will the dividends be treated when it comes to Revenue Canada. Or are the dividends converted to Canadian dollars before I receive them?

Q: Les'question today about Alcoa - I think it may be a bit more complex. Alcoa first did a reverse 1 for 3 split and then days later spun off 1 share of a new company for every 3 of the new shares of Alcoa. At the same time they named the new company Alcoa and the old company Arconic. Les' BV for Arconic should be the old Alcoa BV (before the 1 for 3) and his $2,000 BV for the new Alcoa is the BV of the spinoff, so adding the two together he should have GAINED $2,000 in overall BV (probably temporarily). There may be no tax implication for a Canadian holder IF CRA eventually approve the spinoff under S86.1 (they haven't yet, so Les may find the $2,000 reported as a taxable stock dividend in a T5). If and when they do approve Les will have to advise CRA how he wishes to proceed under S86.1 - see an accountant or google several good articles on foreign spinoffs. I intend to file assuming approval and ignoring any stock dividend with an accompanying letter to CRA electing to defer tax and at the same time reducing the Arconic BV by the amount of the new Alcoa BV thus cancelling the temporary increase in BV. Worked for me before on HPQ/HPE and DHR/FTV. Hope this helps.

Q: alcoa split the shares 1 for 3 in Nov 1. My original book value for the shares are $6000. After the split the book value is reduced to $2000 althought I will get additional few new alcoa shares.It sounds to me it is rotten deal.

Q: I hold the above stocks in my RRIF and plan on transferring 'in kind' one of the stocks into my non registered account. Which one do you consider most appropriate and why?
Thanks and enjoy your time off. RAM

Q: Hi Group Hoping for a prosperous new year in 2017 for us all. I got ahead of myself and purchased $5.000 of GUD. What the penalty for this I bought it last Friday Dec 23 ...Can I reverse it and then purchase on the 2nd when markets open or?

Q: if it takes 3 days for deals to clear can you buy equities now for 2017 contributions ?

Q: When rolling put options does the superficial loss rule apply?

Q: MST.UN is mentioned often on the BNN Market Call Q&A sessions [excellent info show].
Good #'s and $'s, good prospects esp. with Trump/Perry and the pendingTexas oil boom.
My Q is about the dividend payout. What are the tax implications re CRA reporting and showing for tax year. Is the payout in US $? If so, the purchase exchange is offset by the falling Cdn $, the rising US$ and the creation of a US account for future US equity purchases. How is the future sale etc. treated by CRA?. I realize you are not tax people but I'm sure these are fundamental questions by novices. Thank you.

Q: My question is about year end taxes for capital gains or losses. If I sell a stock on say Dec 28, is it considered a gain/loss for the 2016 tax year or 2017 tax year? The "settlement date" always appears to be three trading days after the sale date. I am guessing the "settlement date" is the date that is used for tax gains/losses - is that correct? Is there a specific date in 2016 when the gains/losses are considered to be in 2017 - Dec 28?

Q: Hi Peter and Ryan, I'm just making sure I understand the withdrawal rules correctly in dealing with TFSA accounts. I have some cash accumulated from the payments of dividends during the last few months in my TFSA. Am I allowed to withdraw say $2,000.00 in cash from my TFSA account in the next few days (before December 31). Then after Jan 1st, 2017, does my new limit for 2017 become $7,500.00? If so can I transfer (in kind) shares from a cash account worth $7,500.00 into my TFSA without issues? Thank you so much for all you do and all the best in the new year. Mario.

Q: Do you have an opinion of ETF's structure. Specifically Horizons using derivatives and reflecting dividends in the share price vs. more conventional ETF's. If you could comment on the downside and upside of either structure. Thank-you and Merry Christmas.

Q: Good Day

With tax loss season here, any suggestions for buying stocks being sold for tax losses.

Thank you