Quote:
Originally Posted by darklord700
One concept that some people missed when evaluating RRSP/TFSA is that almost all investment income is taxed twice in Canada. Only RRSP/TFSA investment income is taxed once.
For example, to invest $1000 and generate $50 in interest, capital gains or dividends, your start with eg $1400 pre-tax personal or business income in most circumstances. But in RRSP/TFSA, your ending investment income is taxed only once, at the end for RRSP and at the beginning for TFSA.
That's why RRSP/TFSA will always give higher after tax investment income in theory than that from a non-registered account.
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I can't understand what you're saying here? Its probably me because I'm working really long days at this point and I'm quite tired, but could you explain this a little more thoroughly so that I understand it better (hopefully).
Frankly, I love threads like this. It gives me a better understanding of how "average" people view RRSPs and how they understand how they operate. I just think that is invaluable for me!