Capital Gains Question

[DuffMan]

Originally Posted by Locke

Pretty much bang on. Yes you can use bankrupt shares as a capital loss, BUT the company has to be gone. They cant be still listed and trading their shares for like $0.0000001 Cents or some crap like that and you should have it documented, but its usually pretty obvious.

My bill is in the mail...

Thanks

My payment is the mail...

[amorak]

Originally Posted by Azure

Why must capital gains taxes be replaced? Whats wrong with people making money on their investments and being able to keep it?

Its not that I hate all taxes, I just think we should be encouraging people to invest their money by allowing them to keep most if not all of their return.

Originally Posted by Azure

Tough call. I think its stupid that the money is technically being taxed twice, but on the other hand I like the fact that it can encourage the company to invest that money into other projects instead of paying it out to the shareholders.

But that is just me being an evil capitalist that wants companies to invest their money into building the economy.

On the other hand the shareholders deserve to make money too.

Is there double taxation of dividends in Canada? I know the US has it.

If I were a CA, I wouldn't know where to begin...


1) The purpose of the Capital Gains 50% inclusion rate is to encourage people to invest

2) No, there is not a double taxation on dividends - That's the purpose of the Dividend Tax Credit and the gross up. The result is that the total tax paid on that $1 of dividend, when you factor in the corp tax paid on the earnings and the personal tax = what you would have paid on normal personal income, give or take a bit.


There is no real double taxation in Capital gains and the whole purpose of the DTC is to eliminate or mitigate any double taxation. I am a proponent of Capital gains tax because of the 50% deduction (due to the inclusion rate) that we enjoy - But I'd love to see that rate drop! 25% inclusion = .

[MoneyGuy]

Originally Posted by amorak

If I were a CA, I wouldn't know where to begin...

1) The purpose of the Capital Gains 50% inclusion rate is to encourage people to invest

2) No, there is not a double taxation on dividends - That's the purpose of the Dividend Tax Credit and the gross up. The result is that the total tax paid on that $1 of dividend, when you factor in the corp tax paid on the earnings and the personal tax = what you would have paid on normal personal income, give or take a bit.

There is no real double taxation in Capital gains and the whole purpose of the DTC is to eliminate or mitigate any double taxation. I am a proponent of Capital gains tax because of the 50% deduction (due to the inclusion rate) that we enjoy - But I'd love to see that rate drop! 25% inclusion = .

This.

The problem with Internet forums is sometimes incorrect information is presented as fact. While maybe a bit high, there is nothing wrong with taxing cap gains. I, too, would like to see it halved to 25%.

The dividend tax credit ensures there is no double taxation of Canadian dividends.

Good post. Right on the mark.

[Azure]

Like I said above, it is a tough call as it can encourage companies to invest money.

In the general scheme of things its probably not a big deal. Cut it back to 40% and see where that leaves us.

The taxes on corporations are probably a bigger issue to deal with when we're talking about encouraging companies to come here than the capital gains tax.

[Shazam]

Yeah, yeah, DTC. It benefits small companies more than large company dividends.

Anyhoo, the real answer is to never declare anything