Investment Q&A

Q: My wife will have no income for 2yrs and then a pension of about 30k after that. What is the max she can withdraw from an rsp for those 2yrs while paying minimum tax. In money saver I read that 10k withdrawn for no tax but what would be an optimum amount be. Looking to take out as much as possible during this time. Thank you all for such a great service. Chris

Q: Hi Peter, Ryan and team,
You've clearly built quite a firm with a solid following, and equally clearly, you have an informed and knowledgeable clientele as well. I just read Fraser's advice on the issue I broached about HP's split into two last November, and CRA's foot-dragging on the matter.

Just a quick note to say thank you to you guys, and also to other members, and particularly Fraser!
Cheers,
Warren

Q: On February 25 Warren asked you a question about the tax treatment of the stock dividend which set up HPE as a spinoff from HPQ. I am not a tax expert but I have established that HP applied to CRA on November 1 for this transaction to be tax-free under S86.1 and it looks to me as though CRA have not yet ruled. Their website (search "foreign spinoffs") is silent on HP and their most recent approval relates to a transaction which took place around August. Absence of ruling would explain why the stock dividend would be included on the T5. No doubt CRA would take the position that one should file including the stock dividend as income and then re-file an amended return if and when they approve HP's application, but it may be worth waiting until nearer the deadline to see if CRA approves the application which would allow the stock dividend to be excluded (though the book values of both HPE and HPQ would then change). Hope this helps and hope somebody else can add more.

Q: A recent answer pointed out that tax losses can be carried forward indefinitely. If tax losses are carried forward from a previous year, they do not reduce income until after the OAP clawback has been calculated. If you have stocks that have become worthless, don't write them off until you have some capital gains to offset them, in the same year.

Q: My wife has a loss carry-forward in her non-registered account. I'm thinking that with only one place for the $5,500 investment this year it would be better to work on reducing the loss carry-forward than contributing to her TFSA. Once the loss carry-forward has been eliminated contribute to her TFSA.

Is my thinking correct?

Thanks
Ron

Q: In general what are the tax implications of investing in US markets.
Thank You

Q: Hello 5i, Can I get your analysis on Richards. One thing I noticed going thru the financials is that the distribution is a return of capital and not a dividend. Could you clarify that as well and the implications on my investment as I understood it to be them simply returning my money as opposed to getting a dividend from profits. Thanks

Q: What stocks would be classified as foreign investments to be reported on T1135 form even though listed on Canadian exchanges? I am referring to stocks covered by 5i or frequently mentioned in the q&a section.I believe you have stated CXI, PHM and TCN fall in this camp. Might I assume BPY.UN any others? Is this information available from other sources? Thanks as always.

Q: Good Morning
I realize that in order to claim a capital loss you have to wait for 30 days before repurchasing the security.Can you still claim a capital loss if you purchase a call option of the said security after you sold it ?
Thanks

Q: Re Ralph's question: since there is no change in beneficial ownership, there should not be a tax consequence. Henry

Q: If I own CXI in my non-reg account and TFSA account (both are at a loss) and I sell it in my non-reg to take advantage of a tax loss, does the fact that I still own it in my TFSA make it a superficial loss? I will not be buying it back in the non-reg.

Q: hi Peter
I am looking at some re balancing my portfolios - wanted your opinion on how I should set up my 3 accounts. I use a Registered account - non registered account and a TFSA account. I invest in Growth stocks - Dividend stocks and I also invest in some smaller cap aggressive growth stocks as well. I still have apx 35yrs before withdrawing from my rrsp account. I have been using my rrsp account for Large Cap Dividend stocks but not sure that's the best way to go? any advice is appreciated

Q: If holding for the long term, does it make more sense (taxes) to have these stocks in a RSP instead of a cash account?

Q: Are there any tax issues with holding BIP.un in a non registered account? Is it eligible for a canadian dividend credit or does it count as a foreign dividend?

Q: hello 5i:
can you advise what type of tax treatment dividends from US REITs, such as OHI, receive here in Canada? From either a registered or open account?
thanks
Paul L

Q: I understand that if I transfer a stock from a non registered account to a TFSA a/c I cannot claim tax loss on the transaction. Am I correct to assume that if there is a gain, then a capital gain is not applicable as well?

Q: Happy New Year Peter and the 5i Team,

Last year,I transferred (in-kind) some 'poorly' performing stocks from my RRIF to my non-registered account. The reason for doing this is three-fold: (1) I am in the fortunate position of not needing the RRIF income for living expenses, so am gradually reducing my RRIF portfolio even though I realize that these withdrawals are taxable.
(2) If the stocks continue to under perform, they can be used as tax-loss selling inside the non-registered account. (3) If the stocks turn around, then the non-registered portfolio will grow, and the dividend tax credit will help to reduce the overall tax burden, when applicable.

Given that my 'thesis' is valid, and if what I've outlined is a good idea, which of these "under performers" in my RRIF would you suggest be transferred to my non-registered account? ABT, G, HLF, PEY, and SPB.

Thanks to 5i's timely advice,the "outperformers" in my RRIF have done very well so that even in this difficult market, the portfolio is still up and handily beating the TSX.

Since this is a rather convoluted question, please dock my question credits accordingly!

Thanks as always.

Q: I have a locked in RSP that I want to soon access. Can I still hold stocks if I transfer it to a LIF or a LIRA? I live in Nova Scotia.

Thanks

Q: I hold in my margin account stocks that are down:
BYD.UN (-4%)
CXI (30%)
MG (9% )
DOL (10%)

Can I transfer on January 4th.2016 this stocks in kind from my margin aacount to my TFSA account and have at the same time tax loss selling for 2016 apply to my margin account.

Q: If I sell an equity when the market opens on Dec 29th would it qualify for tax loss selling?