Option-trading-tfsa

Option-trading-tfsa

Bagaimana-untuk-menghitung-a-forecast-using-a-3-dan-5-periode-moving-average
Trading-system-bse
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Stock-options-uruguay Bagaimana-untuk-melaporkan-perusahaan-saham-pilihan-di-pajak-kembali Apakah-biner-pilihan-legal Pindah-rata-artikel Stock-options-for-the-cz-550 Apa-is-a-pair-trading-strategy

Sepuluh pertanyaan TFSA dijawab hi Saya menemukan komentar untuk slide 5 menyesatkan mengenai saham dividen di dalam TFSA. Anda mengatakan dengan memegang saham dividen di dalam TFSA 8220 Anda akan kehilangan kredit pajak8221. Ya, itu benar secara teknis. Tapi saham yang membayar dividen di dalam perusahaan TFSA tidak memerlukan kredit pajak dividen karena semua pendapatan yang diperoleh di dalam TFSA bebas pajak. Itu adalah pesan yang lebih lurus ke depan yang dibutuhkan untuk slide ini. Dan jawaban untuk pertanyaan slide tidak seharusnya tidak begitu jelas. Tidak ada hukuman untuk menahan saham dividen di TFSA. Sekali lagi, karena tidak ada pajak yang dibayarkan di TFSA. Dari situs web Anda: 8220 Setelah investasi dilakukan di TFSA, M. setiap pendapatan atau keuntungan modal sesudahnya sepenuhnya bebas pajak. Penarikan juga bebas pajak. TFSA adalah semua tentang pengembalian bebas pajak, jadi ini cara yang pasti untuk Anda hindari pajak keuntungan modal8221 Bruce Mitton pada 18 Januari 2017 jam 9:17 pagi Terlalu benar. Sering tampak bahwa banyak cerita keuangan pribadi ini dan usaha mereka untuk mengoptimalkan pemerataan pajak tidak melihat setiap pilihan. Mereka hanya melihat apa yang tampaknya menjadi aturan praktis, diciptakan oleh siapapun. Dan terlalu sering, aturan praktis ini tampaknya tentang membayar persentase pajak terendah mutlak, namun pada gilirannya, apa yang Anda korbankan Satu peraturan adalah, jika Anda memiliki saham dividen Kanada, pastikan Anda mendapatkan kredit dengan menyimpannya di Akun yang tidak terdaftar Seperti yang Anda tunjukkan, ini pasti benar. Anda mungkin ingin tidak membayar pajak dibandingkan dengan mendapatkan kredit dan membayar sejumlah pajak. Yang lain mungkin memegang barang-barang bantalan bunga dasar di TFSA karena bunga dikenakan pajak pada tingkat yang lebih tinggi. Baiklah, tunggu sebentar. Seandainya kita menginginkan PERTUMBUHAN di TFSA kita itu bagus, saya dapat menghemat persentase pajak yang lebih besar dengan menyimpan tabungan, GIC, atau bahkan obligasi saya di TFSA, tapi saya akan menyimpannya semaksimal mungkin atau mungkin tidak sama sekali. Tentu, Anda mungkin membayar persentase yang lebih tinggi di luar pada bunga yang diperoleh di luar akun terdaftar, namun jenis investasi tersebut tidak akan tumbuh sebanyak itu. Mike pada tanggal 19 Januari 2017 di 4:27 pmIncome Tax Folio S3-F10-C1, Investasi Berkualitas RRSPs, RESPs, RRIFs, RDSPs dan TFSAs Seri 3: Rencana Properti, Investasi dan Tabungan Folio 10: Rencana Terdaftar untuk Perorangan Bab 1: Berkualitas Rencana tabungan pensiun terdaftar (RRSPs), dana pensiun pendapatan terdaftar (RRPs), tabungan terdaftar (RDSPs), dan rekening tabungan bebas pajak (TFSAs), dana pensiun bebas pajak (TSPS), tabungan tabungan bebas pajak (RESPs) ) Diwajibkan untuk membatasi investasi mereka pada investasi yang memenuhi syarat. Bab ini membahas jenis properti yang paling umum yang merupakan investasi yang memenuhi syarat, serta konsekuensi pajak untuk mengakuisisi, menahan dan membuang investasi yang tidak memenuhi syarat. Ini juga membahas konsekuensi pajak dari rencana terdaftar yang menjalankan bisnis atau meminjam uang. Bab ini tidak membahas peraturan anti-penghindaran untuk investasi dan keuntungan terlarang yang berlaku untuk RRSP, RRIFs dan TFSA. Aturan investasi yang dilarang dibahas dalam Folio Pajak Pendapatan S3-F10-C2, Investasi Terlarang - RRSPs, RRIFs dan TFSAs dan peraturan keuntungan akan dibahas dalam Bab terpisah yang akan dirilis kemudian. 160 CRA menerbitkan folio pajak penghasilan untuk memberikan interpretasi dan posisi teknis mengenai ketentuan tertentu yang terdapat dalam undang-undang pajak penghasilan. Karena sifat teknisnya, folio digunakan terutama oleh spesialis pajak dan individu lain yang memiliki kepentingan dalam hal pajak. Sementara komentar dalam paragraf tertentu dalam folio dapat berhubungan dengan ketentuan undang-undang yang berlaku pada saat pembuatannya, komentar semacam itu bukanlah pengganti undang-undang. Oleh karena itu pembaca harus mempertimbangkan komentar semacam itu sehubungan dengan ketentuan hukum yang berlaku yang berlaku selama tahun pajak tertentu. Diskusi dan interpretasi Ikhtisar investasi yang memenuhi syarat 1.1 Bagian ini dimaksudkan untuk memberi pembaca gambaran tentang peraturan investasi yang memenuhi syarat untuk RRSP, RESPs, RRIFs, RDSPs dan TFSAs. Hal ini tidak dimaksudkan sebagai pengganti diskusi yang lebih terperinci dan komprehensif yang mengikutinya, yang terutama akan menarik bagi institusi keuangan, perusahaan pialang, spesialis pajak dan pihak lain yang terlibat dalam perencanaan rencana. 1.2 Aturan investasi yang memenuhi syarat berlaku untuk rencana terdaftar yang ditetapkan sebagai kepercayaan. Rencana trusteed yang memungkinkan investor memilih berbagai investasi sering disebut sebagai rencana mandiri. Rencana trusteed juga mencakup rencana yang membatasi investasi pada reksa dana dan produk investasi lainnya yang dikeluarkan oleh perusahaan yang mengelola rencana tersebut. 1.3 Rencana Terdaftar yang berbentuk kontrak deposito atau asuransi, seperti sertifikat investasi yang dijaminkan (GIC) atau anuitas terdaftar, tidak tunduk pada peraturan investasi yang memenuhi syarat. Rencananya sendiri merupakan investasi yang layak. 1.4 Berikut adalah jenis investasi yang memenuhi syarat: uang, GIC dan simpanan lainnya sebagian besar sekuritas yang tercatat di bursa efek yang ditunjuk, seperti saham perusahaan, waran dan opsi, dan unit dana yang diperdagangkan di bursa dan investasi real estat mempercayai reksadana dan Dana terpisah Obligasi Tabungan Kanada dan obligasi tabungan provinsi kewajiban hutang perusahaan yang terdaftar pada kewajiban hutang bursa yang ditunjuk yang memiliki peringkat nilai investasi dan hipotek yang diasuransikan atau hipotek. 1.5 Meskipun Undang-undang dan Peraturan menetapkan jenis investasi yang memenuhi syarat investasi, banyak perusahaan memiliki kebijakan internal yang membatasi jenis investasi berkualitas yang mungkin dipegang oleh rencana terdaftar yang mereka kelola. Perundang-undangan tidak melarang mereka untuk memiliki kebijakan semacam itu, yang mencerminkan keputusan bisnis perusahaan. 1.6 Mengingat banyaknya dan beragam investasi yang ada, CRA tidak memelihara daftar utama investasi khusus yang merupakan investasi yang memenuhi syarat, juga tidak menentukan apakah suatu investasi tertentu memenuhi syarat kecuali dalam konteks keputusan pajak pendapatan awal Atau audit 1.7 Wali amanat terdaftar bertanggung jawab untuk memantau investasi untuk meminimalkan kemungkinan rencana yang memiliki investasi tidak memenuhi syarat. 1.8 Jika rencana terdaftar memperoleh investasi yang tidak memenuhi syarat atau investasi yang ada menjadi tidak memenuhi syarat. Konsekuensi pajak yang merugikan berarti berlaku. Dalam kasus RRSP, RRIF, TFSA atau RDSP, annuitant atau pemegang rencana dikenai pajak 50 yang dapat dikembalikan dalam keadaan tertentu dan diminta untuk mengajukan pengembalian pajak khusus dan mengirimkan pajaknya. Selain itu, rencananya akan dikenakan pajak atas pendapatan yang diperoleh dari investasi yang tidak memenuhi syarat. Dalam kasus RESP, rencananya dikenai pajak 1 bulanan dan pendaftarannya dapat dicabut. Wali amanat dari rencana tersebut diminta untuk mengajukan pengembalian pajak dan mengirimkan pajak atas nama rencana tersebut. Referensi untuk berbagai persyaratan 1.9 Istilah berikut digunakan di sepanjang Bab ini: Kepercayaan yang diatur oleh RRSP, RESP, RRIF, RDSP atau TFSA dirujuk secara individual sebagai RRSP, RESP, RRIF, RDSP atau TFSA, masing-masing, dan secara kolektif sebagai Rencana terdaftar Rujukan ke wali amanat dari rencana terdaftar berarti penerbit trust yang diatur oleh RRSP, RDSP atau TFSA, pembawa kepercayaan yang diatur oleh RRIF atau wali amanat trust yang diatur oleh RESP. Suatu obligasi, surat hutang, surat berharga atau kewajiban serupa disebut sebagai kewajiban hutang. Orang yang terhubung untuk tujuan interpretasi peraturan mengenai investasi yang memenuhi syarat didefinisikan dalam sub-bagian 4901 (2) Peraturan sebagai orang yang merupakan annuitant berdasarkan RRSP atau RRIF, penerima manfaat atau pelanggan berdasarkan RESP, penerima manfaat atau pemegang Di bawah RDSP atau pemegang TFSA. Ini juga mencakup orang lain yang tidak berurusan dengan panjang tangan dengan orang itu. Untuk diskusi mengenai kriteria yang digunakan untuk menentukan apakah orang-orang saling berhadapan dalam hal senjata, lihat Pajak Penghasilan Folio S1-F5-C1, Orang Terkait dan Penangguhan pada Panjang Lengan. Jenis investasi yang memenuhi syarat 1.10 Jenis properti yang merupakan investasi yang memenuhi syarat untuk RRSP, RESP, RRIF, RDSP dan TFSA dijelaskan dalam definisi investasi yang memenuhi syarat di bagian 146 (1). 146,1 (1), 146,3 (1), 205 (1) dan 207,01 (1). Definisi tersebut juga mencakup referensi properti tertentu yang dijelaskan dalam definisi investasi yang memenuhi syarat di bagian 204. Sebagai tambahan, investasi yang ditentukan oleh bagian 4900 dari Regulasi adalah investasi yang memenuhi syarat. Ada kemungkinan investasi memenuhi syarat di bawah lebih dari satu ketentuan. Daftar investasi yang memenuhi syarat umumnya sama untuk semua lima rencana terdaftar. Bila ada perbedaan, hal ini telah dicatat dalam deskripsi investasi tertentu. Tabel di 1.100 mencantumkan otoritas undang-undang atau peraturan spesifik untuk setiap jenis investasi berkualitas yang dijelaskan dalam Bab ini. 1.11 Umumnya, kondisi yang harus dipenuhi agar investasi menjadi investasi yang memenuhi syarat berlaku secara terus-menerus. Namun, beberapa ketentuan mengandung persyaratan yang berlaku hanya pada satu titik waktu, biasanya pada akuisisi investasi dengan rencana terdaftar. Jika demikian, hal itu telah dicatat di bagian Bab yang menjelaskan investasi itu. Uang dan simpanan 1.12 Uang adalah investasi yang memenuhi syarat baik dalam mata uang Kanada maupun valuta asing, asalkan nilai pasar wajarnya tidak melebihi nilai yang dinyatakan sebagai tender legal di negara penerbitan. Koin langka dan bentuk uang lainnya yang dipegang untuk nilai tertagih bukanlah investasi yang memenuhi syarat. Mata uang digital, seperti Bitcoin, tidak dianggap sebagai uang yang dikeluarkan oleh pemerintah suatu negara dan tidak memiliki investasi yang memenuhi syarat. Kontrak valuta asing bukan merupakan uang dan pada umumnya tidak memenuhi syarat investasi (lihat 1.46). 1.13 Deposit dengan cabang bank Kanada, deposit dengan perusahaan kepercayaan Kanada, atau setoran lainnya dalam arti yang diberikan oleh Canada Deposit Insurance Corporation Act adalah investasi yang memenuhi syarat. Hal ini mengakomodasi jaminan sertifikat investasi, deposito berjangka dan bentuk deposito lainnya. Karena definisi deposit berdasarkan Undang-undang tersebut tidak termasuk deposito dan deposito berdenominasi dalam negeri dengan jangka waktu lebih dari lima tahun, simpanan tersebut hanya akan memenuhi syarat jika bank tersebut berada di bank cabang Kanada atau perusahaan kepercayaan Kanada. 1.14 Deposit dengan credit union adalah investasi yang memenuhi syarat. Namun, deposit tersebut tidak akan menjadi investasi yang memenuhi syarat untuk rencana terdaftar dalam satu tahun kalender jika credit union setiap saat selama tahun tersebut memberikan atau memperpanjang keuntungan atau hak istimewa kepada orang yang terhubung berdasarkan rencana tersebut sebagai akibat dari rencana tersebut Atau investasi terdaftar yang diinvestasikannya) yang telah melakukan investasi dalam bentuk saham, kewajiban atau deposito yang dikeluarkan oleh credit union. Pembatasan ini tidak berlaku untuk RESPs. 1.15 Dengan beberapa transaksi yang melibatkan sekuritas, rencana terdaftar mungkin diminta untuk meninggalkan uang muka dengan broker. Meskipun setoran semacam itu pada umumnya bukan merupakan investasi yang memenuhi syarat, CRA tidak akan menerapkan konsekuensi pajak penghasilan yang merugikan yang dijelaskan di 1,69-1,80 jika deposit tersebut diserahkan kepada broker tidak lebih dari beberapa hari. Surat Berharga yang Terdaftar 1.16 Kecuali untuk derivatif tertentu, setiap keamanan yang tercatat di bursa efek yang ditunjuk (seperti yang dijelaskan pada 1.17) adalah investasi yang memenuhi syarat. Ini mengakomodasi berbagai jenis surat berharga yang terdaftar, termasuk: saham perusahaan yang ditempatkan dan opsi panggilan menjamin kewajiban hutang unit unit dana yang diperdagangkan di bursa investasi real estat mempercayai unit kepercayaan dan unit kemitraan yang terbatas. Kontrak berjangka dan instrumen derivatif lainnya yang mana pemegang risiko kerugian dapat melebihi biaya pemegang tidak memenuhi syarat investasi. Kenyataan bahwa seorang broker mungkin bersedia menempatkan sebuah pengaturan untuk menutup kontrak berjangka sehingga dapat memperkecil kemungkinan rencana terdaftar masuk ke posisi rugi tidak mengatasi batasan ini. Bursa efek yang ditunjuk 1.17 Bursa efek yang ditunjuk didefinisikan sebagai bursa efek, atau bagian dari bursa efek, yang ditetapkan oleh Menteri Keuangan pada bagian 262. Daftar bursa efek yang ditunjuk diterbitkan di situs web Departemen Keuangan Kanada. 1.18 Sistem kutipan over-the-counter (OTC), seperti Dewan Buletin OTC dan OTC Link ATS (dahulu Pink Sheets) di Amerika Serikat, tidak ditunjuk bursa efek. Akibatnya, sekuritas yang diperdagangkan di pasar OTC pada umumnya tidak memenuhi syarat investasi. Namun, sekuritas OTC masih dapat memenuhi syarat jika mereka mencantumkan silang pada bursa efek yang ditunjuk atau jika sekuritas memenuhi persyaratan kualifikasi lainnya seperti yang berlaku untuk usaha kecil Kanada tertentu (lihat 1,55-1,66). 1.19 Banyak bursa saham di Uni Eropa (UE) mengoperasikan dua segmen pasar, sebuah pasar resmi yang diatur oleh UE dan pasar tidak resmi yang diatur oleh bursa itu sendiri. Pasar yang terakhir mencakup Alternative Investment Market (AIM) di London Stock Exchange, Alterniances yang dioperasikan oleh berbagai bursa efek yang terdiri dari Euronext dan Open Market di Frankfurt Stock Exchange. Hanya pasar resmi yang diatur oleh UE yang memenuhi syarat sebagai bursa efek yang ditunjuk, asalkan bursa saham dimasukkan ke dalam daftar Departemen Keuangan. Pasar bursa yang tidak resmi dan tidak diatur tidak memenuhi syarat karena tidak dikenali sebagai pasar resmi berdasarkan undang-undang Uni Eropa, juga tidak tunduk pada persyaratan transparansi dan peraturan perlindungan investor yang ketat. Oleh karena itu, daftar di pasar yang tidak resmi dan diatur dengan peraturan tidak menjadi dasar bagi wali rencana terdaftar untuk mengkonfirmasi status investasi yang memenuhi syarat dari keamanan tertentu. Daftar Bersyarat 1.20 Dalam penerbitan sekuritas publik yang baru, pencatatan sekuritas mungkin tertunda dalam waktu singkat sambil menunggu pemenuhan kondisi tertentu. Suatu keamanan yang disetujui untuk daftar atau yang memiliki persetujuan bersyarat untuk pencatatan tidak pada saat itu dianggap terdaftar di bursa efek yang ditunjuk. Agar keamanan memenuhi syarat, daftar harus penuh dan tanpa syarat. Ditangguhkan dari perdagangan atau yang terdaftar di 1.21 Saham perusahaan yang tinggal di Kanada yang terdaftar di bursa efek yang ditunjuk di Kanada namun telah diskors dari perdagangan atau delisting umumnya akan mempertahankan status investasi yang memenuhi syarat dengan dasar bahwa perusahaan tersebut terus berlanjut Menjadi perusahaan publik Sebagaimana dibahas di 1.23, saham perusahaan publik adalah investasi yang memenuhi syarat. Status investasi yang memenuhi syarat bisa hilang, bagaimanapun, jika perusahaan tersebut memilih (atau ditunjuk) untuk tidak menjadi perusahaan publik. Dalam kebanyakan situasi lain, penangguhan atau penghapusan keamanan akan mengakibatkan hilangnya status investasi yang memenuhi syarat, kecuali jika keamanan juga memenuhi syarat di bawah ketentuan lain. American Depositary Receipts 1.22 American Depositary Receipt adalah investasi yang memenuhi syarat, asalkan properti yang diwakili oleh tanda terima (umumnya saham perusahaan yang terdaftar di bursa saham di luar Amerika Serikat) tercantum di bursa efek yang ditunjuk. Banyak American Depositary Receipts sendiri terdaftar di bursa efek yang ditunjuk dan dengan demikian juga memenuhi syarat berdasarkan keamanan yang terdaftar, seperti yang dibahas pada 1.16. Perusahaan publik 1.23 Kewajiban berbagi atau hutang dari perusahaan publik adalah investasi yang memenuhi syarat, kecuali seperti yang dibahas pada 1.29. Untuk komentar tentang arti perusahaan publik. Lihat Buletin Interpretasi IT-391R, Status Korporasi. 1.24 Ambisi perusahaan yang tunduk pada definisi perusahaan publik di ayat 89 (1) memungkinkan sebuah perusahaan baru memilih untuk dianggap sebagai perusahaan publik sejak tanggal pendiriannya. Untuk memenuhi syarat, perusahaan harus menjadi perusahaan publik pada atau sebelum waktu itu harus mengajukan T2 kembali untuk tahun pajak pertamanya dan harus mengajukan pemilihan dengan pengembalian tersebut. Efek retroaktif dari pemilihan ini juga berlaku untuk tujuan peraturan investasi yang memenuhi syarat. Dengan mengajukan pemilihan yang sah, saham atau kewajiban hutang yang tidak memenuhi syarat dari perusahaan baru yang diakuisisi oleh rencana terdaftar antara tanggal penggabungan dan waktu dimana perusahaan tersebut menjadi perusahaan publik akan menjadi investasi yang memenuhi syarat sejak mereka berada. Jadi didapat Dengan demikian, pajak investasi yang tidak memenuhi syarat yang berlaku berlaku akan dianggap tidak berlaku. Dana investasi 1.25 Unit kepercayaan reksadana (sebagaimana didefinisikan dalam butir 132 (6)) adalah investasi yang memenuhi syarat. 1.26 Bagian dari perusahaan reksa dana pada umumnya merupakan investasi yang memenuhi syarat. Perusahaan reksa dana didefinisikan dalam Pasal 131 (8) sebagai perusahaan yang memenuhi persyaratan dalam paragraf 131 (8) (a) sampai (c) atau memenuhi syarat sebagai perusahaan modal ventura yang disponsori tenaga kerja yang ditentukan. Setiap korporasi yang merupakan perusahaan reksa dana berdasarkan pendekatan pertama adalah definisi perusahaan publik dan oleh karena itu sahamnya merupakan investasi yang memenuhi syarat (seperti yang dibahas pada 1.23). Sebuah perusahaan modal ventura yang disponsori tenaga kerja yang diresepkan pada umumnya tidak secara definisi merupakan perusahaan publik dan oleh karena itu tidak memenuhi syarat atas dasar ini. Namun, sahamnya mungkin masih memenuhi syarat untuk RESP, RRSP, RRIF atau TFSA dimana kondisi yang dibahas dalam 1.63 terpenuhi. 1.27 Bagian atau unit perusahaan atau kepercayaan yang merupakan investasi terdaftar (RI) (sebagaimana didefinisikan dalam butir 204.4 (1)) adalah investasi yang memenuhi syarat. Jika rencana yang terdaftar untuk mengakuisisi saham atau unit tersebut sebelum perusahaan atau perusahaan trust menjadi RI, saham atau unit masih dapat memenuhi syarat berlaku surut pada saat akuisisi jika perusahaan atau trust terdaftar sebagai RI sebelum akhir tahun taksiran Saham atau unit diperoleh. Perhatikan bahwa registrasi sebuah RI tidak dapat memiliki efek retroaktif lebih awal dari awal tahun kalender dimana aplikasi untuk pendaftaran dilakukan. Juga, jika perusahaan atau trust kehilangan statusnya sebagai RI, saham atau unitnya akan mempertahankan status investasi yang memenuhi syarat sampai akhir tahun taksiran segera mengikuti tahun dimana deregistration terjadi. 1.28 Tipe-tipe tertentu dari RI (yang dijelaskan pada paragraf 204.4 (2) (b). (D) atau (f)) diminta untuk membatasi investasi mereka pada investasi yang memenuhi syarat. Apabila negara tersebut memperoleh investasi yang tidak memenuhi syarat, maka RI akan dikenai pajak khusus berdasarkan Pasal 204.6 (1). Hal ini tidak akan mempengaruhi status RI sendiri sebagai investasi yang memenuhi syarat untuk rencana terdaftar. 1,29 Bagian dari perusahaan investasi hipotek (MIC) adalah investasi yang memenuhi syarat untuk rencana terdaftar tertentu asalkan MIC tidak memiliki hutang orang yang terhubung berdasarkan rencana tersebut. Istilah MIC didefinisikan dalam subbagian 130.1 (6). Meski MIC dianggap sebagai perusahaan publik. Saham dan kewajiban hutang MIC secara tegas dikecualikan dari kualifikasi atas dasar ini. Kewajiban hutang 1.30 Beberapa kewajiban hutang yang lebih umum yang menjadi investasi yang memenuhi syarat adalah: kewajiban hutang yang dikeluarkan atau dijamin oleh Pemerintah Kanada (misalnya, Obligasi Tabungan Kanada) merupakan kewajiban hutang yang dikeluarkan oleh provinsi atau kotamadya di Kanada atau federal atau Perusahaan mahkota provinsi merupakan kewajiban hutang yang dikeluarkan oleh perusahaan, kepercayaan reksadana atau kemitraan terbatas, saham atau unit yang terdaftar di bursa efek yang ditunjuk di Kanada merupakan kewajiban hutang yang dikeluarkan oleh perusahaan yang sahamnya tercatat di bursa efek yang ditunjuk. Di luar Kanada suatu kewajiban hutang yang dicatatkan pada bursa efek yang ditunjuk (lihat 1.16) penerimaan bankir terhadap perusahaan Kanada, asalkan perusahaan tersebut bukan merupakan orang yang terhubung berdasarkan rencana terdaftar sebuah kewajiban hutang yang dikeluarkan oleh bank asing yang berwenang dan harus dibayar di Cabang bank Kanada merupakan kewajiban hutang yang dimiliki, atau dimiliki pada saat pembelian, peringkat investment grade (umumnya BBB o R yang lebih tinggi) dengan lembaga pemeringkat kredit yang ditentukan (lihat 1.31) dan diterbitkan sebagai bagian dari satu isu tunggal, atau dalam program penerbitan berkelanjutan, dengan hutang sekurang-kurangnya 25 juta jaminan yang didukung oleh hipotek (umumnya merupakan kepentingan yang tidak terbagi atau tidak terbagi sepenuhnya Di kolam hipotek atau klaim hipotek) jika: memiliki peringkat nilai investasi dengan lembaga pemeringkat kredit yang ditentukan pada saat diakuisisi oleh rencana terdaftar dikeluarkan sebagai bagian dari penerbitan minimal 25 juta dan memperoleh semua atau sebagian besar dari keseluruhan Nilai pasar wajar dari kewajiban hutang yang dijamin dengan hipotek atau hipotek pada properti nyata atau tidak bergerak yang terletak di Kanada dan beberapa hipotek lain atau klaim hipotek yang dibahas pada 1,32-1,36. Lembaga pemeringkat kredit yang ditentukan 1.31 Untuk keperluan jenis kewajiban hutang yang dijelaskan pada 1,30 (h) dan (i), berikut adalah lembaga pemeringkat kredit yang ditentukan: A.M. Best Company, Inc. DBRS Limited Fitch, Inc. Moodys Investors Service, Inc. dan Standard amp Poors Financial Services LLC. Dalam beberapa kasus, peringkat hutang dapat diberikan oleh anak perusahaan atau afiliasi dari salah satu lembaga pemeringkat yang terdaftar ini. Dimana fakta, struktur perusahaan dan hubungan hukum memperjelas bahwa sebuah lembaga pemeringkat terdaftar mengakui dan akan bertahan berdasarkan peringkat yang diberikan oleh anak perusahaan atau afiliasinya, maka syarat bahwa peringkat tersebut dengan lembaga pemeringkat kredit yang ditentukan akan dipuaskan. Lengan panjang dan hipotek non-lengan panjang dan hipotek 1.32 Selain sekuritas berbasis mortgage (lihat 1.30 (i)), ada dua jenis investasi hipotek atau hipotek lainnya yang merupakan investasi berkualitas. Ini biasanya disebut di industri investasi sebagai hipotek lengan panjang (dibahas dalam 1,33-1,35) dan hipotek non-lengan panjang (dibahas pada 1,36). Tidak ada persyaratan pajak penghasilan bahwa hipotek semacam itu merupakan hipotek pertama atau hipotek perumahan. 1.33 Kewajiban hutang yang dijamin sepenuhnya oleh hipotek atau hipotek pada properti nyata atau tidak bergerak yang berada di Kanada adalah investasi yang memenuhi syarat untuk rencana terdaftar, asalkan peminjam bukan orang yang terhubung berdasarkan rencana terdaftar. Secara umum, kewajiban hutang akan dianggap sepenuhnya terjamin jika nilai properti nyata atau tidak bergerak yang dijanjikan oleh peminjam kepada pemberi pinjaman jika terjadi gagal bayar cukup untuk menutupi jumlah pokok dan bunga pinjaman penuh . Untuk tujuan ini, setiap penurunan nilai pasar wajar properti setelah kewajiban hutang diterbitkan bisa diabaikan. 1,34 Properti nyata atau tidak bergerak bukanlah investasi yang memenuhi syarat untuk rencana terdaftar. Namun, rencana terdaftar mungkin memperoleh properti nyata atau tak tergoyahkan untuk melindungi investasi hipotek atau hipotek yang default. Dalam hal ini, CRA tidak akan menerapkan konsekuensi pajak yang merugikan (seperti yang dijelaskan pada 1,69-1,80) asalkan properti tersebut ditawarkan untuk dijual dalam kondisi yang wajar dan dijual dalam waktu satu tahun. Kerangka waktu yang lebih lama mungkin terjadi dalam keadaan yang tidak biasa. Setiap biaya hukum yang dikeluarkan untuk penyitaan, penjualan atau proses lain yang diperlukan untuk melindungi investasi adalah biaya, dan harus dibayar oleh, rencana terdaftar. Jika biaya dibayar oleh annuitant, holder atau subscriber dari rencana atau oleh orang lain, mereka akan diperlakukan sebagai kontribusi atau hadiah atas rencana tersebut dan dapat menimbulkan konsekuensi pajak yang merugikan. Semua dana atau properti yang diperoleh dari proses ini harus disimpan ke dalam rencana terdaftar. Jumlah apapun yang tidak disetorkan ke dalam rencana terdaftar akan dianggap sebagai penarikan dari rencana tersebut dan dikenai pajak sesuai dengan itu. 1.35 Jika hipotek atau hipotek berada dalam keadaan gagal bayar dan wali rencana terdaftar gagal mengambil tindakan yang tepat untuk melindungi investasinya (atau memerlukan otorisasi dari pemegang, pemegang atau pemegang iuran annuitant sebelum melakukan tindakan tersebut), ini merupakan indikator bahwa peminjam Mungkin tidak berurusan dengan panjang lengan dengan annuitant, holder atau subscriber. Jika ini masalahnya, karena peminjam akan menjadi orang yang terhubung. Investasi tidak akan lagi menjadi, atau mungkin tidak pernah, merupakan investasi yang memenuhi syarat. Penentuan ini akan memerlukan tinjauan terhadap fakta-fakta spesifik. 1.36 Kewajiban hutang yang dijamin dengan hipotek atau hipotek pada properti nyata atau tidak bergerak yang berada di Kanada adalah investasi yang memenuhi syarat jika dikelola oleh pemberi pinjaman yang disetujui berdasarkan Undang-Undang Perumahan Nasional dan diasuransikan oleh Canada Mortgage and Housing Corporation (CMHC) atau oleh Perusahaan asuransi swasta yang disetujui hipotek. Daftar pemberi pinjaman yang disetujui tersedia di situs CMHC. Tingkat bunga dan persyaratan lainnya harus mencerminkan praktik komersial normal dan hipotek atau hipotek harus diberikan oleh pemberi pinjaman yang disetujui dengan cara yang sama seperti hipotek atau hipotek pada properti milik orang asing. Kegagalan untuk melakukannya dapat mengakibatkan konsekuensi pajak yang merugikan. Obligasi strip 1.37 Obligasi strip dibuat ketika obligasi biasa dipisahkan menjadi komponen pembayaran bunga dan pokok untuk dijual kembali sebagai investasi individual. Jika obligasi asli merupakan investasi yang memenuhi syarat, maka porsi pembayaran bunga dan bagian pokok obligasi (yang sering disebut kupon dan residu masing-masing) juga akan menjadi investasi yang memenuhi syarat. Bunga yang tidak terbagi atas hak untuk menerima kupon atau pembayaran residual tersebut juga akan memenuhi syarat. Waran dan opsi 1.38 Sebagai tambahan atas waran dan opsi yang terdaftar (lihat 1.16), hak-hak tertentu yang tidak terdaftar memenuhi syarat untuk mendapatkan investasi dengan rencana terdaftar. Surat perintah, opsi atau hak yang serupa adalah investasi yang memenuhi syarat untuk rencana terdaftar jika memberi hak kepada pemegang atau segera untuk memperoleh properti yang merupakan investasi yang memenuhi syarat untuk rencana tersebut. Properti yang mendasarinya harus: saham, unit atau hutang penerbit hak (atau orang atau kemitraan yang tidak sesuai dengan kepentingan lama dengan penerbit) atau surat perintah yang diterbitkan oleh penerbit (atau oleh bukan senjata). Partai panjang) yang memberi pemegang hak untuk mendapatkan saham, unit, atau hutang semacam itu. Selain itu, penerbit tidak boleh menjadi orang yang terhubung di bawah rencana terdaftar. Hak mungkin juga menyediakan uang tunai untuk menggantikan pengiriman properti sebenarnya. 1.39 Kondisi kualifikasi untuk properti yang mendasarinya mungkin termasuk kondisi yang berkaitan dengan annuitant, holder atau orang lain yang terhubung berdasarkan rencana terdaftar (seperti ambang kepemilikan maksimum). Dalam hal ini, perlu diasumsikan bahwa rencana yang terdaftar telah melaksanakan hak dan memperoleh properti yang mendasarinya. Pada tahun 2012, Kenjii membeli 5 dari saham biasa ABC Company dan mengakuisisi 4 lainnya di RRSP-nya. Perusahaan ABC adalah perusahaan bisnis kecil tertentu. Saham tersebut merupakan investasi yang memenuhi syarat untuk RRSP semata-mata berdasarkan sub-bagian 4900 (14) Peraturan. Kenjii berurusan dengan panjang lengan dengan ABC Company. Baru-baru ini, Kenjiis RRSP membeli waran yang memberi RRSP hak untuk mengakuisisi 3 saham ABC lainnya. Waran tidak terdaftar di bursa efek yang ditunjuk. Agar waran menjadi investasi yang memenuhi syarat untuk RRP Kenjiis, saham yang mendasarinya harus memenuhi uji investasi yang memenuhi syarat. Seperti yang dijelaskan pada 1.56-1.60, salah satu syarat untuk saham perusahaan bisnis kecil tertentu menjadi investasi yang memenuhi syarat adalah bahwa saham tersebut tidak menjadi investasi terlarang untuk rencana tersebut saat diakuisisi. Dalam situasi ini, diasumsikan bahwa RRSP telah melaksanakan waran tersebut. Ini berarti Kenjii akan memegang 12 saham biasa ABC dan akan memiliki ketertarikan yang signifikan terhadap ABC Company. Dengan demikian, saham yang mendasari akan menjadi investasi terlarang untuk RRSP. Akibatnya, waran tersebut bukanlah investasi yang memenuhi syarat. Fakta bahwa saham yang saat ini dimiliki oleh RRSP adalah investasi yang memenuhi syarat tidak relevan dengan penentuan ini. Opsi menulis 1.40 Saat menulis opsi put dan call (kadang disebut jual), tidak ada properti yang benar-benar diakuisisi oleh option writer pada saat opsi tersebut dijual disamping pilihan premium. Pilihan penulis hanya menerima kewajiban untuk menjual atau membeli properti yang mendasari pada harga yang disepakati seandainya pemegang opsi menggunakan haknya. Oleh karena itu, pilihan penulisan, dalam dan dari dirinya sendiri, umumnya tidak tunduk pada peraturan investasi yang memenuhi syarat. Namun, beberapa peraturan pajak penghasilan lainnya mungkin membatasi kemampuan rencana terdaftar untuk terlibat dalam strategi penulisan pilihan (dibahas di 1,41-1,44). 1,41 Seperti dibahas pada 1,86. RRSP, RRIF, RDSP atau TFSA umumnya dikenakan pajak atas pendapatan bisnisnya. Jika RESP ditemukan menjalankan bisnis, pendaftaran rencana dapat dicabut. Rencana terdaftar yang melibatkan strategi penulisan opsi yang bersifat spekulatif dapat dianggap menjalankan bisnis. Oleh karena itu, akan dikenakan pajak atas premi atau pendapatan lain yang diperoleh sehubungan dengan kegiatan tersebut (atau dapat dibatalkan dalam kasus RESP). Apakah pembayar pajak menjalankan bisnis hanya dapat ditentukan setelah meninjau semua fakta yang berkaitan dengan pembayar pajak keadaan tertentu. Pandangan CRAS adalah bahwa penulisan opsi panggilan tertutup, dimana rencana terdaftar menjual opsi panggilan sehubungan dengan properti dasar yang telah dimilikinya, tidak menghasilkan, dalam dan dari dirinya sendiri, dalam rencana terdaftar yang dianggap membawa Pada bisnis Sebaliknya, penulisan pilihan panggilan yang tidak terungkap, atau penulisan opsi put, baik sendiri atau kombinasi dengan posisi lain, dapat menyebabkan rencana terdaftar dipertimbangkan untuk dijalankan pada bisnis. 1.42 Rencana yang terdaftar umumnya dilarang meminjam uang. Bergantung pada situasinya, penulisan sebuah opsi dapat menyebabkan penulis harus meminjam dana untuk menutupi kewajiban mereka berdasarkan perjanjian opsi. Jika rencana terdaftar adalah meminjam uang, konsekuensi pajak yang merugikan yang dibahas di 1.83 akan berlaku. 1.43 Sudah lazim bagi perusahaan pialang untuk menerapkan persyaratan margin sehubungan dengan berbagai strategi pilihan. Sebagai contoh, seorang penulis pilihan mungkin diminta untuk menyetorkan uang tunai ke perusahaan pialang mereka untuk menutupi kewajiban mereka berdasarkan perjanjian opsi. Seperti yang tercatat di 1.15. Jika deposit dibiarkan dengan broker lebih dari beberapa hari, deposit tidak akan menjadi investasi yang memenuhi syarat. Aturan investasi yang memenuhi syarat juga berlaku di mana premi opsi dibayarkan dalam bentuk non tunai atau dalam opsi non-tunai. Setiap properti yang diperoleh dari rencana terdaftar harus merupakan investasi yang memenuhi syarat untuk menghindari konsekuensi pajak yang merugikan. 1.44 Pajak keuntungan di bagian 207.05 dapat berlaku jika kepercayaan RRSP, RRIF atau TFSA terlibat dalam transaksi opsi tertentu. For example, this would be the case where: the counterparty to the option contract does not deal at arms length with the annuitant or holder, or the contract does not reflect commercial terms, which serves to artificially shift value into or out of the registered plan. Foreign exchange trading 1.45 Foreign exchange trading, also referred to as Forex trading, encompasses a number of financial instruments or transactions. These can range from simply holding foreign currency to entering into various foreign exchange contracts such as spots, futures, forwards, swaps and options. The ability for registered plans to engage in foreign exchange trading is severely restricted, as discussed in 1.46. 1.46 Foreign currency is generally a qualified investment, as discussed in 1.12. Foreign exchange contracts that are listed on a designated stock exchange are also qualified investments if the holders risk of loss does not exceed the holders cost (see 1.16 ). This would include, for example, foreign currency options. Most other listed foreign exchange contracts, such as foreign currency futures contracts, are not qualified investments because the risk of loss exceeds the cost of the contract. Foreign exchange contracts that trade on the over-the-counter (OTC) markets, such as swap or forward contracts, are not qualified investments. These contracts do not constitute money, nor is the OTC market a designated stock exchange. As with option writing, a registered plan that engages in foreign exchange trading may be considered to be carrying on a business and be subject to adverse tax consequences. Such a determination is a question of fact. Similarly, if a registered plan were to borrow money to cover its obligation under a foreign exchange contract, adverse tax consequences would apply. See 1.83 and 1.86 for more details. Annuity contracts 1.47 Several types of annuity contracts are qualified investments, although some are eligible only for certain plans. A qualification condition common to each annuity contract is that it be issued by a person licensed under Canadian or provincial law to carry on an annuities business. the registered plan is the only person entitled to any annuity payments under the contract (disregarding any subsequent transfer of the contract by the registered plan), and the holder of the contract may surrender the contract at any time for an amount that is approximately equal to its fair market value (ignoring reasonable sales and administration fees). This includes, for example, a segregated fund annuity. 1.49 An annuity payable to the annuitant at the maturity of an RRSP is a qualified investment for the RRSP if the annuity is described in the definition of retirement income in subsection 146(1) . 1.50 An annuity is a qualified investment for an RRSP, RRIF or RDSP if the annuity is similar to an annuity described in 1.49, except that the annuity payments can be made to the RRSP, RRIF or RDSP before the maturity date of the plan. Also, the conditions applicable to RDSP annuities differ slightly to reflect certain attributes particular to RDSPs. Gold and silver 1.51 Subject to certain conditions, investments in gold and silver bullion coins, bars and certificates are qualified investments. The CRA would anticipate that the registered plan trustee would exercise due diligence in using a custodial trustee for such bullion. 1.52 A legal tender gold or silver bullion coin produced by the Royal Canadian Mint with a minimum purity of 99.5 for gold and 99.9 for silver is a qualified investment. To ensure that the coin is not held for its collectible value, the fair market value of the coin may not exceed 110 of the fair market value of its gold or silver content. In addition, the coin must be purchased directly from the Mint or from a Canadian-resident corporation that is a bank, trust company, credit union, insurance company or registered securities dealer whose business activities are regulated by the Superintendent of Financial Institutions or a similar provincial authority (referred to in 1.53 and 1.54 as a specified corporation ). 1.53 A gold or silver bullion bar, ingot or wafer produced by a metal refiner accredited by the London Bullion Market Association and with the same purity standards that apply for coins (described in 1.52) is a qualified investment if it bears a hallmark identifying the refiner, purity and weight. In addition, the bullion must be purchased directly from the refiner or from a specified corporation. 1.54 A gold or silver certificate issued by the Royal Canadian Mint or a specified corporation is a qualified investment if the bullion represented by the certificate satisfies the conditions described in 1.52 or 1.53. In addition, the certificate must be purchased directly from the issuer or from a specified corporation. Small business investments 1.55 Certain small business investments are qualified investments for RRSPs, RRIFs, RESPs and TFSAs, as discussed in 1.56 - 1.66. None of these investments are eligible for RDSPs and only those described in 1.56 - 1.59, 1.63 and 1.64 are eligible for TFSAs (unless they qualify on another basis). Small business corporations 1.56 A share of a specified small business corporation is a qualified investment for an RRSP, RRIF or TFSA if the share is not a prohibited investment for the plan, as discussed in 1.57 - 1.60. For RRSPs and RRIFs, these rules apply only to investments acquired after March 22, 2011. Investments acquired on or before that date are subject to the rules discussed in 1.61 and 1.62 for RESPs. 1.57 A specified small business corporation is defined in subsection 4901(2) of the Regulations by reference to the definition of small business corporation in subsection 248(1) but with certain modifications. In general, a specified small business corporation is a Canadian corporation (as defined in subsection 89(1) but not including a corporation controlled, directly or indirectly in any manner whatever, by one or more non-resident persons) all or substantially all of the fair market value of the assets of which is attributable to assets that are: used principally in an active business carried on primarily in Canada by the corporation or by a corporation related to it shares or debt of connected small business corporations or a combination of the above two. To qualify as a specified small business corporation at a particular time, a corporation must satisfy these conditions either at that time or at the end of the corporations preceding tax year. Active business is defined in subsection 248(1) as any business that is carried on by a taxpayer resident in Canada other than a specified investment business or a personal services business. For more information, see Interpretation Bulletin IT-73R6, The Small Business Deduction . 1.58 A cooperative corporation is expressly excluded from being a specified small business corporation. However, shares of certain cooperative corporations may be qualified investments as discussed in 1.64 . 1.59 The term prohibited investment is defined in subsection 207.01(1) and is generally an investment of an RRSP, RRIF or TFSA to which the annuitant or holder of the plan is closely connected. More specifically, a share of a corporation is a prohibited investment for an RRSP, RRIF or TFSA if the annuitant or holder of the plan: is a specified shareholder of the corporation (generally a taxpayer who owns directly or indirectly 10 or more of any class of shares of the corporation, taking into account non-arms length and certain other holdings) or does not deal at arms length with the corporation. 1.60 The conditions that the corporation be a specified small business corporation. and that the shares not be a prohibited investment. need only be satisfied at the time the RRSP, RRIF or TFSA acquires the shares. This means that, should these conditions later not be met, the shares will not cease to be a qualified investment. It also means that the trustee of the RRSP, RRIF or TFSA is required to confirm qualified investment status for such shares only once at the time of acquisition. However, the annuitant or holder would nonetheless be subject to adverse tax consequences in the event these conditions are no longer met because the shares would be a prohibited investment. See Income Tax Folio S3-F10-C2 for more detail. 1.61 A share of a specified small business corporation may also be a qualified investment for an RESP, subject to rules that are nearly identical to those discussed in 1.56 - 1.60. The difference is that the prohibited investment test is replaced by a requirement that neither the beneficiary nor the subscriber of the RESP be a connected shareholder of the specified small business corporation immediately after the shares are acquired by the RESP. For this purpose, a connected shareholder of a corporation is generally a person who owns, directly or indirectly, at that time, 10 or more of the shares of any class of shares of the corporation or of any other corporation related to the corporation. The term is defined in subsection 4901(2) of the Regulations and is subject to various rules in the definition itself and in subsections 4901(2.1) and (2.2) of the Regulations that either serve to narrow or expand the definitions scope beyond the general description provided above. 1.62 RESP investments in specified small business corporations are also subject to subsection 4900(13) of the Regulations. This anti-avoidance rule addresses schemes that are designed to artificially divert otherwise taxable income into the shelter of the RESP or to circumvent the RESP contribution limit. It provides that a share of a specified small business corporation will cease to be a qualified investment for an RESP if the return from that investment can reasonably be considered to be: payment for services rendered by an individual to the share issuer or to a person related to the issuer or payment for goods or services provided to an individual by the share issuer or by a person related to the issuer. Although investments by RRSPs, RRIFs and TFSAs in specified small business corporations are not subject to subsection 4900(13). such schemes would generally give rise to advantage tax under section 207.05 if they were to occur in the context of these plans. Venture capital corporations 1.63 A share of a venture capital corporation described in any of sections 6700. 6700.1 or 6700.2 of the Regulations is a qualified investment for an RRSP, RRIF, TFSA or RESP. The same conditions applicable to specified small business corporations discussed in 1.56 and 1.60 - 1.62 apply to these venture capital investments. In other words, for RRSPs, RRIFs and TFSAs, the shares cannot be a prohibited investment. For RESPs, the beneficiary and subscriber cannot be a connected shareholder and the anti-avoidance rule in subsection 4900(13) applies. Cooperative corporations 1.64 A qualifying share of a specified cooperative corporation is a qualified investment for an RRSP, RRIF, TFSA or RESP. The terms qualifying share and specified cooperative corporation are defined in subsection 4901(2) of the Regulations. In addition, the same conditions applicable to specified small business corporations discussed in 1.56 and 1.60 - 1.62 apply to these co-op investments. In other words, for RRSPs, RRIFs and TFSAs, the shares cannot be a prohibited investment. For RESPs, the beneficiary and subscriber cannot be a connected shareholder and the anti-avoidance rule in subsection 4900(13) applies. Limited partnerships and trusts 1.65 Subject to subsections 4900(8) and (9) of the Regulations, a limited partnership interest in a small business investment limited partnership and an interest in a small business investment trust are qualified investments for RRSPs, RRIFs and RESPs. These terms are defined in subsections 5102(1) and 5103(1) of the Regulations respectively. An interest in a general partnership is not a qualified investment for any registered plan. Eligible corporations 1.66 A share of an eligible corporation (as defined in subsection 5100(1) of the Regulations) is a qualified investment for an RRSP, RRIF or RESP, if certain conditions are met. The conditions are comparable to those described in 1.56 - 1.62 for specified small business corporations, except that they must be satisfied not only at the time of acquisition but throughout the entire period during which the shares are held by the RRSP, RRIF or RESP. Because the requirements for eligible corporations are viewed as being more onerous than those for specified small business corporations, the latter provisions are normally looked at first in order to obtain qualified investment status for small business shares. Instalment receipts 1.67 An instalment receipt reflects a partial payment on property and gives the owner an interest (or for civil law, a right) in that property. If the receipt reflects a partial payment on, for example, a share listed on a designated stock exchange, the interest or right in that share will constitute a qualified investment for the registered plan. For example, a corporation may have an arrangement to sell shares on an instalment basis, where the shares are sold at a predetermined price with a portion of the sale price payable at the time of sale and the balance to be paid at some future date. The purchase and ownership of the shares are evidenced by the instalment receipt issued to the purchaser at the time of the initial payment. Escrow agreement 1.68 The fact that a security may be subject to an escrow agreement will not in and of itself cause it to be a non-qualified investment for a registered plan, provided that: the security has been issued to and not simply allotted to the registered plan the holder of the security has all the rights of ownership that every other holder has in relation to the issuer and securities that are not subject to an escrow agreement, but which are identical to the escrowed security, are a qualified investment. Tax consequences non-qualified investments 1.69 Adverse tax consequences apply when an RRSP, RRIF, TFSA, RDSP or RESP holds a non-qualified investment. Specifically: the annuitant or holder of an RRSP, RRIF, TFSA or RDSP is subject to a 50 tax that is refundable in certain circumstances an RRSP, RRIF, TFSA or RDSP is taxable on any income earned on non-qualified investments an RESP is subject to a 1 monthly tax and the registration of an RESP may be revoked. These consequences are discussed in more detail in 1.72 - 1.80. 1.70 In addition, the annuitant or holder of an RRSP, RRIF or TFSA may be subject to the 100 advantage tax on specified non-qualified investment income (generally subsequent generation income earned on income previously taxed in the plan). The advantage tax rules will be discussed in a future Chapter. 1.71 If an investment is both a non-qualified investment and a prohibited investment. subsection 207.04(3) deems the investment to be a prohibited investment only. See Income Tax Folio S3-F10-C2 for more detail. RRSPs, RRIFs, TFSAs and RDSPs 1.72 If an RRSP, RRIF, TFSA or RDSP acquires a non-qualified investment or an existing investment becomes non-qualified. the annuitant or holder of the plan is subject to a tax equal to 50 of the fair market value of the property at the time it is acquired or becomes non-qualified. The tax is imposed under section 207.04 for RRSPs, RRIFs and TFSAs and under section 206.1 for RDSPs. If the 50 tax is owing for any calendar year: the annuitant of an RRSP or RRIF must file Form RC339, Individual Return for Certain Taxes for RRSPs or RRIFs with a payment for any balance due no later than June 30th of the following year the holder of a TFSA must file Form RC243, Tax-Free Savings Account (TFSA) Return with a payment for any balance due no later than June 30th of the following year and the holder of an RDSP must file Form RC4532, Individual Tax Return for Registered Disability Savings Plan (RDSP) with a payment for any balance due no later than 90 days following the end of the year. In the case of RRSPs and RRIFs, the 50 tax applies to investments acquired after March 22, 2011. The tax also applies to investments acquired before March 23, 2011 that first became non-qualified after March 22, 2011. An investment that was non-qualified before March 23, 2011 will continue to be subject to the former rules in sections 146. 146.3 and 207.1 that provided for either an income inclusion with an offsetting deduction or a 1 monthly tax. 1.73 The 50 tax on non-qualified investments is refundable in certain circumstances. To qualify for the refund, the investment must be disposed of before the end of the calendar year after the year in which the tax arose (or such later time as is permitted by the Minister of National Revenue). However, no refund is available if it is reasonable to consider that the annuitant or holder knew or ought to have known that the investment was or would become non-qualified. In the case of an RDSP, the refund is limited to the proceeds of disposition of the property if the proceeds are less than the amount of the tax imposed. The forms referred to in 1.72 explain how to claim the refund. 1.74 If a non-qualified investment becomes qualified while being held by an RRSP, RRIF or TFSA, subsection 207.01(6) deems the investment to have been disposed of and reacquired by the plan. This might happen when a delisted security is relisted. Subsection 206.1(6) provides a similar rule for RDSPs. This ensures that a refund is available in this situation, provided the conditions described in 1.73 are met. 1.75 Section 206.4 and subsection 207.06(2) give the Minister authority to cancel or waive all or part of the 50 tax on non-qualified investments in appropriate circumstances, taking into account such factors as reasonable error. The forms referred to in 1.72 explain how to apply for this relief. Trust taxable on non-qualified investment income 1.76 A trust governed by an RRSP, TFSA, RRIF or RDSP is taxable under Part I on any income it earns in a tax year from non-qualified investments in accordance with subsection 146(10.1). 146.2(6) or 146.3(9) or paragraph 146.4(5)(b). Masing-masing. For this purpose, income tax is payable on the trusts adjusted taxable income which is calculated using only the income or loss from non-qualified investments and the full capital gain or capital loss from the disposition of non-qualified investments. The adjusted taxable income also includes capital dividends described in section 83 . 1.77 Subsection 207.01(6) provides a special rule that applies when an investment becomes or ceases to be a non-qualified investment while being held by an RRSP, RRIF or TFSA. Paragraph 206.1(2)(b) provides a similar rule for RDSPs. The rules deem the investment to have been: disposed of immediately before that time for proceeds of disposition equal to its fair market value, and re-acquired for the same amount at the same time. This ensures that only the portion of the capital gain or capital loss that accrues during the period in which the investment was non-qualified is taken into account in determining the trusts adjusted taxable income. Marcs RRSP buys 4,000 worth of shares of Red White and Blue, a company whose shares are listed on a designated stock exchange in the United States. The shares are later delisted and become a non-qualified investment. The shares are only worth 500 when they are delisted. Subsection 207.01(6) deems the RRSP to dispose of the shares for 500 and to re-acquire them at this same 500 cost. Several months later the RRSP sells the shares for 2,500, resulting in an overall loss in value on the shares of 1,500 (4,000 - 2,500). However, the RRSP trustee would calculate the RRSPs Part I tax payable under subsection 146(10.1) based on the capital gain of 2,000 (2,500 - 500) that accrued during the period the shares were non-qualified . 1.78 The trustee must file a T3RET, T3 Trust Income Tax and Information Return for the trust with a payment for any balance due no later than 90 days following the end of the calendar year. 1 monthly tax 1.79 A trust governed by an RESP is subject to a tax under subsection 207.1(3) in respect of each month in a calendar year that it holds a non-qualified investment. The tax is equal to 1 of the fair market value at the time of acquisition of all property that the trust holds at the end of the month that is a non-qualified investment. The RESP trustee must file Form T3GR, Group Income Tax and Information Return for RRSP, RRIF, RESP, or RDSP Trusts for the trust with a payment for any balance due no later than 90 days after the end of the year. RESP is revocable 1.80 If an RESP acquires a non-qualified investment, or an existing investment becomes non-qualified and is not disposed of within 60 days. subsection 146.1(2.1) provides that the RESP is revocable. As a result, the Minister may revoke the plans registration under the Act pursuant to subsections 146.1(12.1) to (13). In such a case, the trust will be subject to tax under Part I on its taxable income for the entire calendar year that includes the date of revocation (not just on its taxable income earned after the date of revocation) because of subsection 146.1(11). The 1 monthly tax would not apply. Removal of non-qualified investment 1.81 The advantage tax rules effectively prohibit most transfers of property between an RRSP, RRIF or TFSA and its annuitant or holder (or a person with whom they do not deal at arms length). These transfers, which are referred to as swap transactions . are treated as an advantage and give rise to advantage tax under section 207.05. There are, however, two exceptions from these rules that facilitate the removal of a non-qualified investment recognizing that in many cases it may not be possible or desirable to sell the investment to an arms length party. 1.82 The swap transaction rules permit a non-qualified investment to be sold to the plans annuitant or holder (or a person with whom they do not deal at arms length), provided that the annuitant or holder is entitled to a refund of the 50 non-qualified investment tax in respect of the investment (see 1.73 ). The removal can also be accomplished by making an in-kind distribution of the non-qualified investment to the annuitant or holder. The distribution is treated as a regular withdrawal and therefore, in the case of an RRSP or RRIF, is included in the income of the annuitant. To avoid imposition of advantage tax, these transactions must occur at fair market value. Although the prohibition on swap transactions does not apply to RDSPs or RESPs, these transactions must nonetheless occur at fair market value to avoid adverse tax consequences. Tax consequences borrowing 1.83 Adverse tax consequences apply to deter registered plans from borrowing money. If an RRSP, RRIF or RDSP has borrowed money in a year (or in a previous year and has not repaid it before the beginning of the year), it is required to pay Part I tax on its taxable income for the year in accordance with paragraph 146(4)(a). subsection 146.3(3) or paragraph 146.4(5)(a). Masing-masing. In this case, the RRSP, RRIF or RDSP must file a T3 return for the year, as discussed in 1.78. If an RESP borrows money, paragraph 146.1(2.1)(d) provides that the RESP is revocable, subject to certain conditions that accommodate short-term borrowing. If a TFSA borrows money or any other property contrary to paragraph 146.2(2)(f). paragraph 146.2(5)(c) provides that the arrangement automatically ceases to be a TFSA effective at the time the borrowing occurs. As a result, the arrangement will lose its tax-exempt status from that time forward. 1.84 The CRA will not apply the adverse income tax consequences described in 1.83 to an overdraft in a registered plan if it: is temporary in nature and covered without undue delay arises as a result of (i) a mismatch of cash flow due to differences in standard settlement cycles for securities, (ii) a reasonable error, or (iii) an unintended infrequent event and does not have the character of leveraged investing. This administrative position is intended to accommodate certain overdrafts of very short duration that are quickly or naturally reversed or that are infrequent and inadvertent. This position does not apply to borrowing that arises in connection with a cashless exercise of warrants or a margin account. 1.85 The borrowing restrictions discussed in 1.83 do not apply where a registered plan acquires a qualified investment that is payable on an instalment basis (see 1.67 ). This is because an obligation to pay instalments does not constitute borrowed money as there is no relationship of lender and borrower between the parties. Tax consequences carrying on a business 1.86 Adverse tax consequences also apply to deter registered plans from carrying on a business in certain situations. An RRSP, TFSA, RRIF or RDSP is generally taxable under Part I on any income it earns in a year from carrying on a business in accordance with paragraph 146(4)(b). subsections 146.2(6) or 146.3(3) or paragraph 146.4(5)(b). Masing-masing. The RRSP, TFSA, RRIF or RSDP must file a T3 return for the year, as discussed in 1.78. An RESP is revocable pursuant to paragraph 146.1(2.1)(c) if it begins carrying on a business. 1.87 The determination of whether a particular taxpayer carries on a business is a question of fact that can only be determined following a review of the taxpayers particular circumstances. Interpretation Bulletin IT-479R, Transactions in Securities. sets out factors developed by the courts that are relevant in determining whether transactions in securities constitute carrying on a business. While there is nothing unique in applying these general principles to securities trading that occurs within a registered plan, several exceptions apply so that certain business activities will not give rise to adverse tax consequences. 1.88 Section 253.1 provides, in part, that an RESP, RDSP or TFSA will not, solely because it acquires and holds an interest in a limited partnership as a limited partner, be considered to carry on the business carried on by the partnership. Consequently, the provisions referred to in 1.86 will generally not apply where an RESP, RDSP or TFSA invests in a limited partnership. 1.89 In the case of an RRSP or RRIF, the rules in paragraphs 146(4)(b) and 146.3(3)(e) for calculating the amount of business income that is taxable to the RRSP or RRIF specifically exclude any business income from, or from the disposition of, qualified investments. This exclusion serves a similar purpose to the rule in section 253.1 in that it ensures that RRSPs and RRIFs are not subject to adverse tax consequences where they make eligible investments in limited partnerships. However, the exclusion is broader in that it applies not just to limited partnership investments, but to any investment of the RRSP or RRIF provided it is a qualified investment. This means, for example, that if an RRSP or RRIF were to engage in the business of day trading of various securities, it would not be taxable on the income derived from that business provided that the trading activities were limited to the buying and selling of qualified investments. 1.90 As discussed in 1.41 and 1.46. where a registered plan engages in certain option writing strategies or foreign exchange trading, it may be considered to be carrying on a business. The same result may arise where a registered plan engages in short selling (which is where an investor sells property they do not own) or securities lending. Note that, because the restriction on borrowing for TFSAs (discussed in 1.83 ) applies to any property not just money, a short sale within a TFSA is effectively prohibited. 1.91 The decision in Prochuk v The Queen. 2014 TCC 17, 2014 DTC 1050 held that trading in a registered plan is not a relevant factor in determining whether a taxpayer is carrying on a trading business outside of the plan. This decision does not stand for the proposition that the trading of securities in a registered plan will not in any circumstance be considered to be carrying on a business by the plan. Obligations of registered plan trustees 1.92 Responsibility for compliance with the qualified investment rules generally lies with the trustee of the registered plan. In the case of RESPs, responsibility may be shared between the trustee and the promoter. In some cases, the trustee may require the annuitant, holder or subscriber of the registered plan to provide the trustee with evidence for the purpose of determining qualified investment status. In these cases, the trustee must exercise due diligence in satisfying itself that the documentation provided is sufficient. The CRA may ask the registered plan trustee to demonstrate how it determined that a particular property was a qualified investment. 1.93 Subsection 207.01(5) requires the trustee of an RRSP, RRIF or TFSA to exercise the care, diligence and skill of a reasonably prudent person to minimize the possibility of the plan holding a non-qualified investment. Paragraph 146.4(13)(d) imposes a similar obligation on the trustee of an RDSP. If a trustee fails to comply with this obligation, the trustee is liable to a penalty under subsection 162(7) . 1.94 The trustee of a registered plan is required to file the tax returns referred to 1.78 and 1.79 on behalf of the trust and remit any balance due. If the registered plan trust does not have sufficient assets to pay any taxes owing (for example, because of a withdrawal or transfer of assets to another institution), the trustee may be held responsible for the tax pursuant to section 159 . 1.95 The trustee of an RRSP, RRIF or TFSA is also required to report information to the CRA and the annuitant or holder if the RRSP, RRIF or TFSA begins or ceases to hold a non-qualified investment in a year. For information on these reporting obligations, refer to: 1.96 The Act requires that all contributions, acquisitions and dispositions of property, distributions, and any other transactions involving a registered plan occur at fair market value. Otherwise, adverse tax consequences will arise. While the term fair market value is not defined in the Act, it generally is considered to mean the highest price expressed in terms of money that can be obtained in an open and unrestricted market between informed and prudent parties, who are dealing at arms length and under no compulsion to buy or sell. The determination of fair market value is a question of fact. 1.97 It is the responsibility of the registered plan trustee to determine the fair market value of property involved in a transaction. In the case of RESPs, responsibility may be shared between the trustee and the promoter. In some cases, the trustee may require the annuitant, holder or subscriber of the registered plan to provide evidence to determine the propertys fair market value. In these cases, the trustee must exercise due diligence in satisfying itself that the documentation provided is sufficient. The CRA may ask the registered plan trustee to demonstrate how the fair market value of a particular property was determined. 1.98 Except for RESPs, it is common for registered plan trustees to have an agreement with an agent, such as an investment broker, that allows the agent to provide the trustee with certain administrative and investment functions. However, the ultimate responsibility for ensuring that a registered plan complies with the qualified investment rules always remains with the trustee. 1.99 All qualified investments of a registered plan must be held by the trustee of the registered plan and not by the annuitant, beneficiary, holder or subscriber under the registered plan. In the case of a share or other security, registration of the security in the name of the trustee demonstrates holding by the trustee. However, there are situations where a security may be considered a qualified investment for a registered plan even though the trustee is not the registered holder of the security. This can happen, for example, where a security dealer holds the qualified investments of the registered plan as the agent for the trustee and it is necessary to register the investments in the dealers name. It can also happen where securities are issued and processed through a central depository for securities, such as CDS Clearing and Depository Services Inc. Where the registration and trading of a security is maintained by a central depository for securities and the security is otherwise a qualified investment, the security will be a qualified investment for a registered plan if the security is held for the registered plan. Statutory or regulatory authority 1.100 The following table lists the specific statutory or regulatory authority for each type of qualified investment described in the Chapter. Specific statutory or regulatory authority for each type of qualified investment Application This Chapter, which may be referenced as S3-F10-C1. is effective September 2, 2016 and replaces and cancels Interpretation Bulletin IT-320R3. Qualified Investments Trusts Governed by Registered Retirement Savings Plans, Registered Education Savings Plans and Registered Retirement Income Funds . Any technical updates from the cancelled interpretation bulletin can be viewed in the Chapter History page. Except as otherwise noted, all statutory references in this Chapter are references to the provisions of the Income Tax Act . R.S.C. 1985, c.1 (5th Supp.). as amended and all references to a Regulation are to the Income Tax Regulations . C.R.C. 1978, c. 945. as amended. Links to jurisprudence are provided through CanLII. Income tax folios are available in electronic format only. Sections 146, 146.1, 146.2, 146.3, 146.4, 204, 205, 206.1, 207.01, 207.04 and 207.1, and section 4900 of the Regulations. Date modified: 2016-09-01 Secondary menuTFSA vs RRSP: Head to Head Comparison There has been a lot of talk about which one is better, the TFSA vs RRSP in both the PF blogosphere and the media. Both are great savings and investing tools for us Canadians, but there are important differences between and choosing correctly between the Tax-Free Savings Account (TFSA) and Registered Retirement Savings Plan (RRSP) can save you thousands of dollars in the long-term. In an ideal world, one would max out both their RRSP and the TFSA. In the real world though, life happens . It is oftentimes very difficult to be able to scrounge up the money (without having to sell a kidney on the black market) to be able to max out both if your tax-advantaged accounts. In my opinion, the RRSP and the TFSA are like siblings. Not twins mind you but siblings with different personalities. In some ways they are almost mirror opposites and the inverse of each other. Both options share the trait that they allow you to shelter your investments from taxation allowing your money to grow tax free using a wide variety of investment options. Each have their time and place, and are fantastic tools in their own way, but as we all know, one probably deserves more of your attention than the other (just like parents who really do have a preference of one sibling over the other, but they dont say it aloud) uh oh, is my middle child syndrome coming out in my post. Sorry about that. So lets talk about the RRSP first (the older sibling): The Basic Lowdown on the RRSP: The RRSP can hold a number of things (including GICs, stocks, mutual funds, and bonds) its like a basket of investments sheltered from tax. Contributing to the RRSP is done with PRE-TAX income (the tax refund you get is your pre-tax money, but given to back to you at a later date). You will have to pay tax eventually when you take money out 8211 its a tax-deferral program. The hope is that when you take money out of the RRSP, youll be at a lower income than when you put money in (aka retired), so the average tax rate that you pay on the savingsinvestments will be lower. You are supposed to contribute to it to reap the tax deductions when youre at a higher tax bracket, and take it out when you are in a lower tax bracket. Your maximum RRSP contribution is calculated by calculating 18 of your gross income or 25,370 (as of 2016) whichever is lower. Any unused contribution room can be carried forward to the next year. There are two options where you are allowed to borrow money from your own RRSP (but it has to be paid back later): Home Buyers Plan (25,000 max) Lifelong Learning Plan (10,000 per year, 20,000 total max) The TFSA Lowdown: People could first contribute to a TFSA in 2009 (this is the new toddler sibling, becoming ever more popular). Each year after the age of 18, you can contribute to 5,500 per year to a TFSA. (It is indexed to general inflation after briefly being raised to 10,000 per year with no indexing under the Federal Conservative government in 2015.) Currently in 2016, if you havent opened a TFSA before, you can contribute up to 46,500 Like an RRSP, you can hold a number of things within the TFSA. The TFSA is like a basket that you put investments into. (GICs, High Interest Savings Accounts, stocks, bonds etc.) Money contributed to TFSAs is done with AFTER TAX income meaning that you dont get a tax refund because the money you put it was done after you paid taxes on it. You can withdraw money any time tax free If you withdraw money, you have to be careful about making contributions back into your TFSA within the same year. Its kind of a weird rule, but the TFSA only gives you back your contribution room during the following calendar year. For example, if you have maxed out your TFSA contribution, then you withdraw 2,000, you cant put 2,000 back into your account later in the year unless you want to pay a penalty. Instead, in 2017 you would have 7,000 worth of contribution room available. Many people have been using the TFSA as an emergency fund, but with the increasing amount allowed (46,500) I think people should be looking at other options for their TFSA. If you use the TFSA to invest in long-term equities, you can shelter a substantial amount of investment earnings in your TFSA. Would you rather shelter the 1 you are getting in a high interest savings account, or the 7-8 a balanced index ETF portfolio could snag you RRSP pre-tax dollars invested, taxed when you withdraw TFSA after tax dollars invested, no tax when you withdraw. Now that weve introduced the siblings, lets look at their good and bad traits. PROS of the RRSP : It feels awesome to get that tax return. Especially when you use that tax return to supercharge your RRSP contributions for the following year. RRSPs are great in that you are sort of forced not to withdraw from it (other than for school or for a first time home purchase) because of the tax hit you will take if you do so. Were all human, and if we know that money is accessible then its hard to keep sticky fingers away from the cookie jar Consequently, using an RRSP is a great way to develop disciplined investing habits. Its an especially good tool for those with high incomes who are taxed to the nines. It can feel good to get some of your tax dollars back and then defer your investment returns until you retire to a lower tax bracket. RRSPs are perfect for holding stocks and ETFs from the USA. This is because of a tax treaty that Canada and the USA have when it comes to taxation of dividends. It can get kind of complicated (if you want the in-depth explanation, heres a good place to start ), but suffice it to say that RRSPs are a great place to park US-based equities. CONS of the RRSP: Its a tax deferral so if youre fortunate to have a great pension, you will be taxed to the nines when you are in retirement, especially when you are forced to take your RRSP out when you turn 71 via Registered Retirement Income Fund (RRIF). Some people end up paying an even higher tax rate than they would have during their early working years. You cant take money out penalty-free except for buying your first home or under the Lifelong Learning Plan. If you arent making much money that year (e.g. if you are a student) there isnt too much point in taking a deduction and chasing a big tax return via an RRSP contribution. You already arent taxed very highly (if at all), so you wont get much of your taxes paid back. Better to use a TFSA here. If you dont re-invest your tax refund (woo hoo Caribbean trip), then you lose out on the pre-tax advantages. Most Canadians gloss over this little detail. Now lets look at the flashy younger sibling, the TFSA PROS of the TFSA Its a very flexible savings tool that allows folks to take money in and out of a tax-sheltered account easily and without penalty. TFSA investments have already been taxed, so unlike your RRSP investments, you can safely determine exactly how much money you can take out when you retire. RRSP withdrawals of course are subject to whatever new tax rate comes out. When you retire and started pulling money out of your RRSP and TFSA accounts, as well as collecting government payments such as Old Age Security (OAS), the government takes your RRSP withdrawals into consideration when clawing back your OAS but this is not the case when withdrawing from TFSA. Just like the RRSP, your investments can compound inside your TFSA tax-free (this can make a HUGE difference if you start at a young enough age). CONS of the TFSA The problem is that it is being heavily marketed as a Tax-Free High Interest Savings Account by all the big banks. You get 2 interest if youre lucky. This misinformation means that people are actually severely misusing their TFSA. Im in favour of renaming the entire package to a Tax-Free Investing Account. This would give people a much more accurate view of the ideal way to use the tax-sheltered account. The majority of Canadians still earn significantly more during their working years than they do in retirement. This usually tips the balance in favour of RRSP contributions. Because its so easy to take money out of a flexible account such as the TFSA, human nature might tempt you into making decisions that are not conducive to building long-term wealth. Some employers only offer pension-match contributions for RRSP contributions. If this is the case then ignore everything else take the free money your employer is offering Decision-Making Flowchart There is more to choosing where to place your hard earned savings than tax considerations. Heres a great tool that we borrowed from a friend. Dont be afraid to ask questions in the comment section below Youngandthrifty8217s Take: The short answer when it comes to the TFSA vs RRSP debate is: Yes DO IT. Truthfully, the real danger here is paralysis by analysis. Picking the wrong one (the better term might be slightly less efficient one) is still much much better than not saving at all Personally, I am trying to contribute to both my TFSA and RRSP in order to take advantage of eachs unique characteristics. I dont have very much money that I am allowed to contribute towards an RRSP anyway because of the Pension Adjustment, so a little tax refund is always nice to offset some things like capital gains, interest income, etc. otherwise I might be paying more taxes when Ive already paid so much in taxes from my primary source of income. Being that Im in a relatively high income tax bracket right now, some RRSP contributions make sense however, I am one of the very fortunate souls that will also have a nice pension to depend on when I retire (assuming I dont get fired) so going all-in on RRSP contributions isnt my favoured approach. I would recommend that for those who are not paying a relatively high level of taxation it is better to contribute to a TFSA. The TFSA is better for short term goals (within 1-10 years), like saving for a down payment, saving for a car, saving for that future baby, or saving for that big trip. As we discussed before however, the TFSA is actually best used for long-term investing. It is like the Swiss Army Knife of registered accounts. Of course, everyone is different and would have a different reason for having one or the other as a better option for their situation. Its best to sit down and really think about the merits of each option to figure out which one you want to allocate the majority of your hard earned money to. Readers, what do you think What are your thoughts between TFSA vs RRSP Are you planning to contribute to both If you had to pick one, which would you choose 110 Comments Etienne on February 7, 2011 at 6:37 pm TFSA 100 before RRSP. RRSP you have to take funds out even if you have other revenue sources. thus putting you in high tax brackets. Taxes are not likely to go down with the economy. I would def. max out TFSA before putting money in RRSP. TFSA your gains are not taxable, ever Jim Yih on February 7, 2011 at 8:37 pm Thanks for the mention. I really appreciate it. I like the siblings analogy. I8217m not sure why their is such a surge of anti-RRSPers out there this year. As you said, they are both good but for really different reasons. People who overgeneralize the tax consequences at the back end may not be cutting the RRSP short. These accounts are not mutually exclusive. you do not have to buy one without the other. You can actually do both. SavingMentor on February 8, 2011 at 4:34 am I agree, both can be a good option because you can withdraw from your TFSA in retirement to keep your retirement income low and also withdraw a little bit from your RRSP at a low marginal tax rate. That8217s pretty win-win. If you have a pension that will increase your income substantially every year, then TFSA would be the clear winner. Fox on February 8, 2011 at 6:53 am Great post YT Personally they both have their advantages. I borrowed for an RRSP yrs ago, paid it off and used the RRSP as my HBP, for my first home about two yrs ago. I was thinking of getting into an TFSA. I just don8217t find it feasable at the moment to invest, as I am eliminating debt. I may convernt some savings and bring them over to the TFSA. Eitherway great post, well explained. Look for the feature in 8220Fox8217s Weekend Blog Love8221 Invest It Wisely on February 8, 2011 at 8:52 am Definitely both for me. Many places offer an RRSP match which means you are losing money if you don8217t at least take advantage of the match. Andy on February 8, 2011 at 11:31 am My strategy this year is to max out RRSP contributions as much as possible and take the tax refunds and put it in TFSA. My reasoning is that who knows what the tax regime will be like in 30 years when I retire. Bear in mind, our country8217s finance needs to survive the boomer seniors first. I suspect there won8217t be enough money and they8217ll encourage seniors to use up their nest egg by taxing it less. Lowering taxes on seniors will be popular and given they of all the various demographic groups is the one most likely to vote, makes political sense as well. I contribute to RRSP to get my money back from the gov now and put it somewhere where they can8217t get at it, unless they change TFSA rules. Basically, the government is betting on the uncertain future and lending you the money. Might as well take it. Balance Junkie on February 8, 2011 at 1:31 pm Wow. You really covered a lot of ground here. Nice job. I8217ve written a lot about the benefits of TFSAs and I do think most Canadians aren8217t using them enough yet. But I would never say that they are better or worse than RRSPs. It really depends on your personal situation. We will continue to use both, but will probably top up our TFSAs first and then contribute to RRSPs. That8217s because we already have a decent amount in RRSPs and we want to allow our TFSA savings to catch up a little. (Thanks for the mention. )) Money Rabbit on February 8, 2011 at 1:09 pm I love both my RRSP and TFSA. My TFSA is used for my investments and its perfect, since I don8217t have to pay taxes on any of the growth and I bought my stocks while I was a student, so I wasn8217t taxed on the money I saved to buy into the market. But I love the RRSP tax refund, and I like the fact that it8217s set aside specifically for my retirement, whereas my TFSA is a little more flexible with what I use the money for. I also won8217t have a very big pension (even though I8217m employed full time, I don8217t really work 8220for8221 a company, I work for two individuals, and so I8217m not going to have a large pension to fall back on) so contributing to my RRSP helps me sleep at night. Patricia on February 9, 2011 at 5:11 am Don8217t forget that you can defer claiming the RRSP contribution until a higher earning year. Nicole on February 9, 2011 at 10:59 pm You forgot the major point of RRSPs for young folks: Your allowable contribution limit for RRSPs will ROLL OVER from year to year. So you don8217t have to contribute right away but it is worth doing so once you8217ve settled into more permanent work and then you can make much more significant contributions. 8220My strategy this year is to max out RRSP contributions as much as possible and take the tax refunds and put it in TFSA8221 young on February 10, 2011 at 7:04 pm Sustainable PF- Hey, that8217s a nice problem to have. It8217s like a bittersweet accomplishment, heading to the next tax bracket. young on February 10, 2011 at 7:14 pm My Own Advisor- Oops- yes, thanks for the clarification. I was being too 8220absolute8221 with the RRSP- yes you can cash them out anytime but you will pay major tax for it- agree that its not preferable, but it is an option. Thanks for your additional tips (re: spousal RRSPs8230 I haven8217t gotten a chance to look closely at that yet since I8217m not a spouse yet ) young on February 10, 2011 at 7:16 pm Jim Yih- You8217re welcome Jim. Agree- there8217s been a lot of RRSP backlash, preferable to max out on both, if possible. young on February 10, 2011 at 7:17 pm SavingMentor- Definitely win-win, but there would have to be a clear distinction from which funds are for retirement in the TFSA, because it8217s just way too easy to dip into the cookie jar when things are so easily accessible. young on February 10, 2011 at 7:18 pm Fox- Thanks Fox (for the love). I would definitely get into a TFSA (especially since we8217re both young). You could definitely convert some savings into a TFSA- because at the non-registered savings rate, you are basically paying for inflation AND you get taxed on the interest income. young on February 10, 2011 at 7:19 pm Invest It Wisely- yes, thanks for mentioning the RRSP match (those good ol8217 employers) That is definitely a win-win scenario. young on February 11, 2011 at 12:43 am Andy- Excellent strategy. That8217s what I plan to do too. Then it8217s like a win-win-win situation Good point that the tax regime will likely look very different 30 years down the road. young on February 11, 2011 at 12:44 am Money Rabbit- Sounds like a perfect game plan (save the money while you8217re a student because it isn8217t taxed and put it into a TFSA) I agree that both are good, for different reasons, and you can8217t really have one over the other. They are both great ways to save for retirement or other big life purchases (e.g. down payment, wedding etc.). Good tax shelters to keep the tax man away (for the time being, anyway). young on February 11, 2011 at 12:45 am Balance Junkie- Thanks for visiting You could do what Andy suggests, which is to use your RRSP refund (or tax refund if you get one) to contribute to your TFSA. I8217m pretty sure I8217m going to be doing that this year. young on February 11, 2011 at 12:46 am Patricia- yes indeed Thanks for pointing that out Merlin on February 15, 2011 at 1:16 pm Ummm8230 I think people are highly neglecting the benefit of an RRSP. The money is not taxed going in8230 it is tax deferred8230. yes you do pay tax on the income gained but only on the back end when you take it out. It not only accumulates tax free but YOU DON8217T PAY TAX GOING IN. On the flip side8230. with the TFSA you are dealing with after tax income8230. So of course it is better that the tax income will never be taxed but you have to account for the fact that you are able to invest less because it is after tax dollars. If the goal is to save for retirement it seems always better to invest in the RRSP first as you are essentially able to invest more because you pay less tax. Imagine you are trying to figure out what to do with 8,000 ish dollars. One option is to pay the tax upfront and then put the 5000 dollars into a TFSA. The other option is to put the whole 8,000 into an RRSP (assuming you have room)8230. if you have a cash flow issue you can borrow to put more in and pay off with the return. The fact that you can essentially invest more (because you are allowed to invest the taxes) means that for retirement purposes you will almost always be better in a RRSP. Yes it is true you have to pay tax on the capital and the interest but here8217s the thing 8211 in the TFSA youalready paid the tax on the principle because it is after tax dollars you are investing8230. young on February 15, 2011 at 10:45 pm Merlin- Thanks so much for your comment. You have detailed the inverse relationship of the RRSP and the TFSA. It8217s best to put money away in both, but if not possible, everyone has a different preference. I suppose it also is important to consider what tax bracket you are in too Sarah on July 21, 2011 at 10:50 am Hello I just found your site. well, I am not sure how I got here. Love it though. am learning lots. My husband and I are both 25 and living in Northern BC. We often have this debate alot. RRSP vs. TFSA. I8217m all for TFSA because I am terrified we are going to be in a high tax bracket when we retire. Hubby is an RCMP officer so will have a good pension. He contributes more to his RRSP because he loves the tax return (sometimes I think he forgets that we8217ll be paying all that tax later) and puts every cent we get back onto our mortgage. I on the other hand, will not have the a great pension. so RRSP seems like a better option for me. Anyways, my mind spins sometimes thinking about what to do, what is best8230 etc etc. Hubby just tells me that atleast we are saving something. Some of our friends don8217t even know what an RRSP is. S young on July 21, 2011 at 10:49 pm Sarah- I8217m so happy that you enjoy my blog Personally, I think a TFSA is where its at for us (especially us with pensions) because who knows when the rules might change The RRSP is good though if you plan to use it for the HBP (Home Buyers Plan) or LLP (Lifelong learning plan). I think you should be very very proud that you contribute to an RRSP TFSA. I know many many many people who are my age (and even in their 308217s) are are not contributing to either. Ronde on August 4, 2011 at 12:55 pm Sarah said, 8220I on the other hand, will not have the a great pension. so RRSP seems like a better option for me.8221 I8217m in the same boat as you and your and your husband. I have a great pension, my wife has no pension. I take out Spousal RRSPs8211I get to deduct the return and use it on the mortgage, SHE gets to withdraw the RRSP income when we retire and not be taxed because her income will be minimal. For people like us, RRSPs win over TFSAs all the time. young on August 6, 2011 at 2:01 pm Ronde- Very good point and analysis on the different scenarios and application of the RRSP for people with pensions and their spouses without. Tom Eaton on September 8, 2011 at 10:27 am young, thank you for explaining the difference between the two RRSPs amp TFSAs.I think the way you and you wife are going about doing it is really smart, I might look into it for my self and my wife. young on September 8, 2011 at 2:17 pm Tom Eaton- Thanks Except I don8217t have a wife lol8230. Money in Training on January 14, 2012 at 1:22 pm Great post Like some of the commenters above me, I have no idea what tax bracket I will be in when I retire. If I had to guess at this stage, I8217d say I would be in a lower tax bracket, which would mean I should prefer socking money away in my RRSP before the TFSA. However, I have read a few articles about METRs and how they can change your situation upon retirement. Currently, I don8217t really understand the concept. Therefore, I have just started contributing to a TFSA (Questrade8217s TFTA) since I already have 4 of each pay cheque going into my RRSP through my employer. If nothing else, having a decent chunk of change in both the RRSP and TFSA will afford me more flexibility when I retire. young on January 15, 2012 at 8:58 am Money in Training- Does your employer match the 4 that you put in your RRSP You sound like you have a great plan ahead. I agree, the METR8217s can be completely unknown in the future I personally like the idea of both RRSP and TFSA as well, though I will probably focus more on my TFSA (provided it still exists in 20 years HA) because of my defined benefit pension plan. Money in Training on January 15, 2012 at 12:14 pm I lied. They actually match upto 3 of every pay cheque. So, essentially 6 of every pay is going towards my RRSP. They also offer a registered and non-registered employee stock purchase plan. They match 50 of your contribution into the ESPP upto 4 of your salary across both (the NR-ESPP and R-ESPP) plans. I have chosen to sock away 3 of every pay into the RSPP and 4 of every pay into the R-ESPP so as to get the maximum possible match from my employer. Why turn down a guaranteed 100 and 50 ROI young on January 16, 2012 at 9:47 pm Money In Training- That8217s excellent I agree. I think it8217s funny why people would turn down employee matching. It8217s free money Robert on February 11, 2012 at 6:46 am YoungandThrifty, I have to tell you the truth. Anyone who has a pension plan at work and contributes to an RRSP is 8220COOKOO8221. Let me explain. In Canada we have a progressive tax system with increasing rates of taxation as your income reaches the predetermined thresholds. Now let8217s say that your pension is going to pay you 70 of preretirement income. If you were earning 80K then pension would we 56K. Now here comes the terrible part. At a taxable income of 56K you would have a marginal tax rate of 31 at todays tax rates. Then you start to receive income from your RRIF to the tune of 16K. You now have a total of 68K retirement income. Now your marginal tax rate is 33 and you have paid taxes on the RRIF income to the tune of 5000 When you deposited this 16K to your RRSP you received a tax deduction of 5600 if you were at a marginal tax rate of 35 So low and behold, for a 16K RRSP contribution your only gain in retirement was 600. The Canada Revenue Agency always gets their tax dollars. There are strategies that are OK, and there are strategies that are AMAZING. Would you take your Rolls Royce to Canadian Tire for and oil change canadiancentsiq on February 11, 2012 at 7:27 am Money in Training, For nearly 85 of Canadians, RRSP8217s as a savings vehicle are the least efficient way to save for retirement. I say this because when you receive the income in retirement, you pay taxes on the money you originally deposited and all of the capital gains and dividends it earned. As an example, if your portfolio of investments earned 50K in Capital Gains and 25K in Dividends all would be taxed as employment income through the RRIF. If your tax rate was 30 in retirement you would pay in taxes to CRA 22.5K. If you had the investments in a 8220Cash Account8221 you would receive preferential tax rates of 15 on Capital Gains and 13 on Dividends. So all said and done you would pay a total of 10.7K in taxes. This means you got to keep an additional 11.8K in your pocket canadiancentsiq on February 11, 2012 at 7:41 am It sounds to me like you need a complete Modern Canadian Personal Finance overhaul. You have been indoctrinated into a belief system that is old and inefficient. The government and the banks only want one thing from you, for the banks its to keep you in debt for as long as possible, and the government wants your taxes. You have the illusion of having savings while paying interest on debt. If you are willing to learn with an open mind, I will show you how you can pay off your mortgage and be debt free in 12 the time. You don8217t need to get a second job, and you don8217t need to stop having fun. The system I employ comes from Australia. It has been around for over 50 years and its the only way people bank. Let me know if this sounds like a better way. Robert has a point about the RRSP. No your not COOKOO With RRSPs you can contribute later. Since 2005 the government has been looking at ways to clawback money like the OAS. We will see more changes to OAS. RRSPs really hurt if one has saved too much, later when you pay taxes. How about something different At looking at the end game Retirement If you are lucky enough to have a full pension you have choices do you want more money now (at retirement) and less survivor money to go to your partner With Life insurance you have choices Can one get 7 or 8 guaranteed at retirement Life insurance (permanent) has a number of things going for it. If you are disabled does the RRSP or TFSA continue to be funded to 60 or 65 every year Can you get all your money back plus interest Is there a death benefit Can you borrow from it and be credited for all your money Is there creditor protection Can you spend and enjoy your money with less risk and pay less taxes plus have more protection The problem is many people have no way of testing different models factoring taxes, inflation, markets etc. The current financial software(out in the market) really looks at rates of return, with out looking at other factors. If you are interested I can do a short webinar on why one would want (not need) permanent life insurance as part of a retirement plan. Assuming they have a partner, kids, etc. young on February 20, 2012 at 1:43 am CCIQ- I know in Australia they have something similar to a tax free savings account. My aunt and uncle who are retired are enjoying something from their. is it called a 8220super8221. Once I finish my HBP I am going to go to TFSA all the way. canadiancentsiq on February 22, 2012 at 7:30 am Dear young, I was referring to the way that Australians conduct their day to day banking. They have a solution that combines their chequeing account, mortgage, line of credit, credit card, and savings all within one product. This product allows for the mortgage to be paid off in half the time, saving the homeowner tens of thousands of 8217s in interest expense. The mortgage portion is based on simple interest not compound interest that which Canadian banks use. I8217m here to tell you that it has been here in Canada for the past 10 years. It is gaining momentum and the big banks are loosing clients to it. How would you like to tell your bank, 8220The Gravy Train Is Over8221 I have much more information to share. young on February 23, 2012 at 11:41 pm CCIQ- That sounds like the Manulife One to me. do they still have that around Bryan Jaskolka on March 29, 2013 at 2:46 pm Wow, what an extremely thorough and comprehensive post regarding the differences between these two savings vehicles, as well as what makes them goodnot so good for those trying to choose between them. So often you find so much general information regarding these two, but no real in-depth, side by side comparison such as this. Thanks for posting Don on May 6, 2013 at 10:14 pm Dear Young, saw your site listed in National Post, Six of the coolest money websites. TFSA vs. RRSP post is ongoing family debate, so read all previous posts. This may be late but for my money TFSA8217s all the way in to-days world of slow growth and low interest rates stretching till If employed with no company pension a TFSA with no taxable income on retirement might even allow person to receive GIS if only taxable income is CPP and OAS. A trading TFSA account costs 50.00 yearly, no fee usually after 25,000.00. Good dividend paying stocks earning 4 and up add to return as well as hopeful increase in share price. All non-taxable in acc. 29.00 trading fee mentioned is only problem if engaged in frequent trading. RRSP trading acc. usually costs 100.00 yearly, some no fee after 25K, some not until 100K. Trades same cost amp returns as per TFSA BUT all taxable income whether withdrawn early or after retirement. If you are going to be receiving a companygovernment pension TFSA would also be my way to go. IE: RCMP pension (indexed) increasing ever year even if slightly on top of CPP and OAS means even higher tax bracket to pay with RRSP returns. Wife with little or no income, priceless. If money contributed to his and her TFSA8217s builds up till retirement, means cash windfall there to be employed however tax free. Plus with both receiving CPP and OAS and splitting his pension with no other taxable income ie: RRSPs, more tax savings. Point for RRSPs, they can also be split with spouse, but point lost if both have them. Family debate has both situations and unless government changes TFSA rules in future, looks like a good retirement tool to use. Teacher Man on May 7, 2013 at 7:28 am We8217re always happy when the mainstream press shines a little light in our direction First off, I myself am very upset by the fact I can8217t use a TFSA right now 8211 or rather the benefits don8217t outweigh the drawbacks. As an AmericanCanadian citizen that has to file taxes in both countries the TFSA is a nightmare. Now when it comes to factoring in GIS into the debate I8217m not sure I would depend on our current retirement structure staying the way it is. Also, if you have that little income in retirement, the low tax rate you8217d pay on RRSP withdrawals shouldn8217t hurt you too bad, and should be down substantially from what it was in your working years The numbers in this article are now a little outdated. Get rid of all of those fees and go to a discount brokerage where your TFSA and RRSP are free, and where you can get your ETFs commission-free Check out our recent Questrade updates for more info. I completely agree that if you are getting a pension the TFSA looks a lot better, especially considering the move to raise tax rates on upper tier earners going forward in the Western World 8211 as a teacher that can8217t use a TFSA this makes me even more angry Check out our free ETF investing guide and see what you think Bodrey on February 28, 2014 at 6:38 pm If you8217re earning a large income then it makes sense to invest in RRSPs to offset the higher rate of income taxes you8217ll pay. IMO, that, and the fact that you can contribute much more to an RRSP than a TFSA (currently, anyway) are the only reasons to invest in an RRSP. Otherwise, a TFSA is the clear winner. For example, let8217s say for argument8217s sake you invest 5K in a TFSA and in 35 years it8217s worth 30K. The initial 5k investment was made with after tax income but you won8217t pay a cent in income taxes on the 25K ROI. Under the same scenario with an RRSP you8217d have to pay income tax on every penny of that 25K. In addition (depending on how much you withdraw for retirement) if you8217re eligible for the GIS it could be clawed back at an effective marginal tax rate of 50 That8217s brutal. And, whose to say in 20-30 years8217 time (if not sooner) the government decides to apply the same rule to OAS Due to demographics going forward, there will be fewer and fewer workers to pay CCP premiums for an ever-increasing number of retirees. So, in the long term the CPP is not sustainable unless taxes rise markedly or benefits are cut back. People need to take charge of their own retirement destinies and put as much away as they possibly can. Kyle on February 28, 2014 at 9:40 pm I completely agree on your idea surrounding government clawbacks Bodrey. I think that scenario grows increasingly likely every year and why I too favour the TFSA. Thanks for the input I have been asked this question so many times, and the answer really depends on each individual8217s personal situation. Their current tax bracket, risk tolerance (therefore expected returns), etc. Ideally, people should contribute the maximum to both every year. Michael on August 8, 2014 at 10:38 am young, I recently discovered this website and really enjoyed reading your post. My wife and I are always discussing the merits of investing in TFSA vs. RRSP, and I8217m curious about what people8217s thoughts are as to what we have chosen. My wife and I are both educators and have an excellent, defined benefit pension plan. Each of us works full time and so we can count on a reasonable retirement income. As the pension plan is obviously registered, it8217s my understanding that we are benefiting from tax deductions based on contributions to that pension. That being said, my wife and I opened Tax Free Savings Accounts in each of our names as soon as we were employed out of university. Her account is intended for short term savingspending goals, and when we had contributed the maximum amount to it, we used about half of it to pay for an auto loan that I got out of school as we needed a vehicle. Now that8217s it8217s been over a year, we plan to continue to contribute to it in the hopes of paying her large student loan off at some point. We use my Tax Free Savings account as a long term investing tool that is invested in a diversified, medium risk mutual fund with the hopes that it will be an excellent supplement to our retirement income as (like you mentioned) the money will be easy to access and obviously tax free. We do not invest in any RRSP aside from the pension contributions that we make on a monthly basis. Any thoughts I love the dialogue that occurs on this website and will continue to read it regularly. Thanks Sarah on August 8, 2014 at 11:26 am I8217m back after several years We ended up opening a spousal RRSP as well. It has been working out great for us. Kyle on August 27, 2016 at 10:26 am IRPs are a much different product Daryl. They are slightly more complicated, but as a general rule I8217d say most people are better off investing in their TFSA and RRSP first, before looking at less mainstream options such as IRPs. that being said, if you can max out the first two, there are some interesting scenarios where IRPs make some sense. TomT on September 27, 2016 at 11:29 am Hello Thanks for the quick and easy read. Like many I originally started saving money for retirement by putting money into an RRSP to help with retirement. The tax refund really made it feel like I was winning twice. About ten years ago though I started working for an employer with an amazing pension plan. Out of I just kept contributing to my RRSP as well. This year I sat down and did the math, and was disappointed to see that the tax advantages of the RRSP is really no longer there for me. In fact I likely should have stopped paying into them five years ago. My advise to anyone with a work place pension and RRSP8217s is to sit down with someone as soon as possible to see if that advantage still exists. For me TFSAs are the only real option now, and I am even considering taking a hit transferring some of my RRSPs to my TFSA as I don8217t know that my tax bracket will actually be any lower in my retirement than it is currently. Add to that I suspect our taxes may actually go up as a result of of irresponsible baby-boomers, I think that TFSAs may actually pay a much larger end benefit. I know I will miss that end of the year refund, but it only counts if I get to keep it in the long run. Kyle on September 28, 2016 at 11:30 am That makes a lot of sense to me Tom, especially when you consider you can withdraw from the TFSA without it affecting your OAS and CPP cheques (can8217t say the same for RRSP). Had you read this article before do you think it would have helped you make the decision I8217m always curious as to if the writing is structured in a way that makes sense for people to digest and take action with. TomT on September 28, 2016 at 2:16 pm Thanks Kyle. I would have loved to have seen this article years earler. It likely would haveat, the very least, triggered me to have a closer look at my savings to see if I was getting the best bang out of my buck. I have already given the link to a few co-workers, as I know they are similarly putting to many eggs in the same basket. That all said the RRSPs really helped motivate me to save, and in my opinion helped me build good savings habits. If my biggest complaint is about which savings plan works best for me, I know I8217m better off than many. Kyle on September 28, 2016 at 6:53 pm Thanks for sharing the link Tom 8211 it means a lot to me when readers engage like that Seems like you have a pretty solid financial foundation and will transition smoothly into the next phase of your life. Ed on December 30, 2016 at 8:58 pm Hi, I8217m new to investing and just trying to learn so that I can get started. I8217m in my 20s I won8217t be retiring for a while, but I8217m just wondering- because I want to start investing my money. So my question is, in my situation, should I start with a TFSA or RRSP I work for the federal public service and the pension is pretty good (defined benefit plan). I8217ve never invested a cent before, financial advisors have always scared me off (hence why I8217m lurking here on your website). So given that I have a good pension when I retire, are you saying I should focus on TFSA instead Thank you kindly. Kyle on January 3, 2017 at 10:50 am You can8217t go wrong getting your feet wet with a TFSA in your situation Ed. You can always use your RRSP room as you get further into your career and presumably make more money. Kira on January 8, 2017 at 5:13 pm Great insight and thorough post on the differences between both investment vehicles I am 31 this year and just maxed out my TFSA but have not invested anything fully in it yet due to market uncertainties. I have like 50 cad and 50 usd parked in there for flexibility in investing CAD or USA markets. I am still not sure what to invest or to max out my money. If your money is parked there without any buying of investments, do you get a 2 high interest from the bank I am thinking of putting in like 25K into my RRSP (which I have not put any yet) for investments and possibly to contribute towards a downpayment to a home in a couple years and also to reduce my tax bracket as I am in a high tax bracket as of this year. I do contract jobs so not much of pension to look for when I retire. What do you suggest I should do or what I am doing is right Kyle on January 9, 2017 at 6:57 pm Have you checked out our robo advisor article. I think it might be a great fit for someone like yourself. Check it out and let me know if you still have these questions. Dominic on January 29, 2017 at 4:31 pm I want to start investing in the stock market by myself. Is it better to use a RRSP or TFSA account for that kind of investment If I have capital gains from selling does the money I keep in the account taxable as income Kyle on January 29, 2017 at 4:49 pm Hi Dominic, the capital gains will not count as taxable income in a TFSA. Any gains in an RRSP will compound tax-free, but are taxable upon withdrawal. Sign up for our free ebook for more details. Kira on January 29, 2017 at 5:54 pm Yes I have read the robo advisor article, very informative I was wondering if you could recommend a robo advisor online for investing like a sum of 30,000. I got 50,000 in my TFSA which I could also transfer over to make it 80,000. Or do you think I should invest in some TD e-series funds on the TFSA while I put like 30k on a robo advisor in a bunch of ETFs to see the performance. Does robo advisors like Weathsimple provide me to contribute on a RRSP I was thinking of contributing to my RRSP before Feb 28th to bring down my tax bracket. Kyle on January 30, 2017 at 6:34 pm Several questions there Kira: 1) If you8217re waiting to 8220see the performance8221 you need to read more of our stuff on indexcouch potato investing. The performance over a short term is almost completely inconsequential. 2) You can move your TFSA andor RRSP over to any of the major robos. 3) It really comes down to if you want to be responsible for re-balancing your TD e-series funds on your own, or what a robo advisor to help with that. Given the questions that you8217re asking, I think you might benefit from the 8220light advice8221 component that the robos offer. Braden on February 17, 2017 at 4:43 pm The only thing I can8217t seem to get is the benefit to investing your tax refund into a RRSP That money was taxed from you and now the government is giving it back to you. What makes it 8220better8221 to invest that money instead of money you received after tax (on your pay cheque). Both we taxed, in fact the money you got back for your refund was tax itself. I don8217t get why there is an added benefit for using an RRSP to invest this money over a TFSA. Someone please explain this to me Kyle on February 18, 2017 at 11:54 am It8217s simply a matter of your tax bracket Braden. Like the advantage of the RRSP is that it is 8220pre-tax income8221 going in right It8217s only truly pre-tax if you invest the money you get back (that should have been yours all along) otherwise your spending your tax deferment. That being said, you could invest the refund in your TFSA and that will still serve you extremely well 8211 so whatever motivates you Manny on February 19, 2017 at 3:49 am Hi I was thinking of investing like 25k-30k for my upcoming RRSP into the TD e series funds like the Canadian Bond Index, Canadian Index, International Index and US Index. What would be a good percentage to contribute for each if I have higher risk tolerance and am 31 years old with lots of contribution as well on my TFSA as well. I am having hard time to distribute to see which one should I go with. I dont think doing 25 for each split would be the best option. Kyle on February 19, 2017 at 6:06 pm Hello Manny. The percentage in each really depends on so many more variables. You could do worse than a 25 x 4 solution If it were me (not saying your variables are like mine) I would tamper down the bond percentage and split it between the Canadian and American markets, but that8217s just me. Manny on February 19, 2017 at 6:41 pm Thanks Kyle for your immediate response I was also thinking more like what you said, 30-30-30-10 like from the couchpotato model portfolio aggressive stance. Like 30 cad market, 30 international market, 30 us equities and 10 in the bond market. I see that they have risen quite high over the past few years so I am not sure if this is the best time to put money in or wait for a drop perhaps in the near future. I know you might say just invest it in because we can never time the market but I would be interested to hear your opinions. Plus I guess with the dividends, I could do a reinvestment plan to buy more of it every year. Kyle on February 20, 2017 at 10:46 am That sounds like a solid plan Manny. I have no idea where the market is headed and if I did 8211 I8217d be managing a hedge fund and not a blog Anyone that tells you they know is likely delusional Manny. I do know that over the last 100 years the stock market has averaged a return of 10 or so. The worst 30-year rolling average is around 6. I just take comfort in those numbers TrackbacksPingbacks
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