Re: last NR
in response to
by
posted on
Mar 11, 2014 09:42AM
He is referring to TFSA - Tax Free Savings Accounts. You can buy/own almost any kind of asset. They are completely non-taxed. No Capital Gains...no personal tax. For most Canadiana, this means gains on a stock are worth about 20-25% more.
Here's an example and I hope I have the details right....
In Canada we typically get the first 50% of capital gains free. All other things being equal, the rest is taxed at your personal income tax rate. For a gain of $10, the first $5 is free, the second $5 is taxed between 35-45% depending on income. At the highest rate of about 45%, which would apply to most people on this forum, you'd pay $2.25 on the $5.
Therefore, stock gains earned in TFSAs are worth at least 22.5% more. That's why he wants the stock to remain stable until his TFSA account gets initialized.