Quote:
Originally Posted by V
I didn't want to hijack the Stocks thread with this, so I thought I'd start a new topic.
Hypothetically, I have 100k in a cash investment account. I also have a 100k mortgage. Can I withdraw the 100k from my investment account, pay off the mortgage, then take out a LOC against the house for 100k, and use that borrowed money to deposit 100k into my investment account? Essentially I'm making all of the interest I pay on the mortgage tax deductible.
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I believe there was a Federal Court decision in favour of Revenue that ruled this a transparent tax avoidance maneuver, but I'll wait for a specialist to weigh in...