Brookfield Office Properties Inc T.BPO.PR.A

Canadian Taxation

[pierrelebel]

It is always frustrating to communique about taxation.  So many people have opinions and so few understand the facts.

For example, a couple living in Ontario and dividing their income more or les equally can earn up to $111,000 a year without paying a penny income tax on their "eligible" Canadian dividends.

On the other hand, eligible dividends deposited into an RRSP or RRIF lose the advantages of the dividend tax credit and the 50% reduction in capital gains as all amounts coming out of RRSP and RRIF are fully taxable.

How to handle your investments keeping in mind the eventual income tax that will have to be paid - use a competent investment adviser who understand and can halp guide you.  Much depends on your age, personal circumstances, province of residence and other income.

Whatever you do.... DO NOT ASSUME.

Many readers may find this https://www.taxtips.ca/taxrates/on.htm interesting.

[CrazyTrader]

To be honest, I've never actually did any "Tax calculations"..... My goal is to grow my TFSA and RRSP accounts.    They grow exponentially.        I'll be happy to pay my taxes (more tax) when I take my money out from my RRSP.   If I win, Tax Man wins...  That's ok.    If I lose, Tax Man also lose, that's ok also

[SONOFFERGUS]

Hi Pierre. Well said.  Taxes are very sensitive to personal circumstances. I think for older investors looking for income, BPO prefs belong in the trading account to take advantage of the DTC.  Younger investors and those who aren't relying on TFSA money might consider holding them there.  RRSP/RRIF would be the last choice for me, since the DTC benefit is lost and capital

[pierrelebel]

Good evening SONOFFERGUS. "BPO prefs belong in the trading account to take advantage of the DTC." Yes, BPO preferred shares are best held in an investment account, not a trust account.  As we get older, we need to have a larger portion of our portfolio in fixed income (most experts suggest 30% to 50%).  This is where TFSA are useful. Someone suggested "margin account

[SONOFFERGUS]

Indeed, margin bad.  That said, I do run almost everything in my margin account to avoid timing issues.  There's no cost for the option to run a debit in the right circumstance, and I'm running one right now pending exit of a couple of positions. The rule of thumb I've known is 100 minus age to equities, rest to debt.  That has not been a winning strategy for a long

[Carena]

Hi Pierre,  I have been away for a couple weeks and just saw your post on Cdn Taxation.  One can only take advantage of the our tax system if one understands it.  You clearly understand it.    Have a great day. Carena