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Reggie28 · 05-08-2021, 01:01 AM

Does anyone here have experience with prescribed loans?

With a prescribed loan you can set up an investment account for a child, funded by a loan from the parent. The current rate is 1% (Bank of Canada rate rounded up). $100 per year for every 10k borrowed. The child then invests the money, makes a return and files income tax. Your 1 year old now has income, dividends and possibly capital gains to report.

I would like to do this for my nieces and nephew. Anyone else doing something like this?

05-08-2021, 01:01 AM	#3107
Reggie28 Scoring Winger Join Date: Mar 2013 Exp:	Does anyone here have experience with prescribed loans? With a prescribed loan you can set up an investment account for a child, funded by a loan from the parent. The current rate is 1% (Bank of Canada rate rounded up). $100 per year for every 10k borrowed. The child then invests the money, makes a return and files income tax. Your 1 year old now has income, dividends and possibly capital gains to report. I would like to do this for my nieces and nephew. Anyone else doing something like this? Last edited by Reggie28; 05-08-2021 at 01:39 AM. Reason: Clarity.