I don't want to rehash again what has been discussed in depth but since there has been new persons query this subjuect, I think it is important that all know as much on this topic as possible so they make a decision that they are comfortable with. I am not trying to woo anyone pro or con, just forwarding information I have gathered. Zenith is a qualified investment for registered accounts like a TFSA. The question is at what price is it okay to transfer from a taxable account to a registered account? Many feel that if a brokerage allows them to do it, they will be clear as it is the brokerage's responsibility. In a while, I will tell an example that might shed some doubt on that. I tend to think that if they allow it, the brokerages feel that they are clear of liability with not as much interest as to whether you are or not. We notice that over and over they are reluctant even at brokerages that have done it before. 

Transfers into TFSA's, etc. are to be done at Fair Market Value (FMV) of which we have no way to determine because ZCC does not trade on an exchange. It would seem that those making the transfer are using ZCC's estimate of Fair Value (FV) of which the latest posted was as at last October of $0.689 USD ($0.927 CAD yesterday). Not long ago this was about $0.83 CAD. Zenith states to not use this value for anything but financial statements. FV of non-trading companies are notoriously low and I think that could be said with this price also. I think there are very few on this board that would sell their ZCC shares for $0.93 right now. Also, to add to this is that the most recent financings have been for $2.00 USD ($2.69 CAD yesterday). I will now proceed with the example I mentioned above.

I recently had a discussion on this with a financial adviser (call him Joe as in Joe Blow) from one of the big five Canadian banks. He had a client that transferred some other equity into his TFSA and had a windfall. This of course triggered an audit by the CRA. I don't know the details of course but the CRA did not accept his price. They did for a small amount but not most of it. This might be from transferring at different times and some they agreed with and others not. I don't know. The fact is that they didn't agree and they did not go after the bank, just him/her. They assessed him/her the taxes that they felt he/she was short, he/she paid them and was okay. Not knowing the particulars, maybe the circumstances made this look like just a mistake or the auditor was a nice guy. He did not assess any penalties or interest. This person came out ahead by transferring because some went through and the portion that did not, just paid the tax that he/she would have had he/she not transferred into the TFSA up to transfer and saved on gains afterward. 

Where I caution is that in an audit, it would be very hard to argue that we did not know that Zenith was worth more than $0.93 or whatever price was used. That leaves it open to the auditor deciding that it was not a mistake but rather a deception to avoid paying tax. He might very possibly levy penalties and interest. The odds are that anyone that makes the transfer will probably come out ahead totally or in part, I am just trying to make sure those that do it know the possibilities and are prepared to deal with the CRA and pay up if necessary whatever they need to. Just so there is no surprise. 

Just be informed and comfortable with you decisions!