Investing

Changes to Capital Gains Tax in Next Budget?

  • Last Updated:
  • Mar 31st, 2017 5:21 pm
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Aug 8, 2012
7321 posts
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BC
Sanyo wrote:
Mar 20th, 2017 1:33 am
Nothing like catering to the poor to get votes -- if they get the stranglehold, no doubt this country will just become the next Greece...and with all the tech investments and such the Libs want to woo in, doing this would be a stupid stupid move.
Democracies are intended to cater to the majority.

LOL that we will become the next Greece. I'm going to take that as sarcastic hyperbole. Because if you are serious that's a ridiculous statement. Greece's debt to GDP is second only to Japan and DOUBLE Canada's.
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Jan 14, 2009
623 posts
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Vancouver, BC
ace604 wrote:
Mar 20th, 2017 2:05 am
Democracies are intended to cater to the majority.

LOL that we will become the next Greece. I'm going to take that as sarcastic hyperbole. Because if you are serious that's a ridiculous statement. Greece's debt to GDP is second only to Japan and DOUBLE Canada's.
Maybe not Greece, yet, but becoming Ontario for sure. YAY! Democracy!!
Member
Dec 30, 1969
325 posts
94 upvotes
Hampstead, QC
In the past it was settlement date...and with tax loss selling at year end, its settlement date...so logically...its settlement date.
Member
Dec 30, 1969
325 posts
94 upvotes
Hampstead, QC
ace...sure I will pay the cap gains...but my trades are never long term, so I pay cap gains anyhow. You can wait and not pay the taxes of course but at some point you still must pay and they will be at 75% inclusion if the changes are made. My profits were big from my miner trades so I had to react or i would have payed 6 figures more under the change. If its retroactive to Jan 1...I am screwed.
Again, lets wait and see what the treehugger does....maybe he wont raise it.
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Jun 27, 2007
2840 posts
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Conquistador wrote:
Mar 19th, 2017 6:09 pm
Source?
I googled and CRA made this decision back in 1973, I believe. Question was how to treat gain/loss when selling at the end of December. CRA said to use settlement date as the date when ownership is actually transferred.

This is TRUE for Stocks (T+3 days). Options settle the next day and futures on the trade day.
I will review my open positions in options, I think I have at least one candidate.
The CRA's long-standing position in IT-133 has been that this settlement date is the date of disposition for income tax purposes.
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Sr. Member
Feb 25, 2007
844 posts
295 upvotes
Ottawa
This speculation made the rounds among the advising/accounting community a while back. Consensus was it was a real possibility (66% or 75% inclusion rate), but also that it might well get postponed/abandoned just like some of the changes to small business deduction eligibility that were being mooted about prior to last year's budget. Seems perceived likelihood has gone down since current thinking is that major tax policy changes will be sent to a task force first -- though still a possibility it will be there in this budget.

For myself, in view of the risk I crystallized some capital gains that I would have likely had to realize in the next 2-3 years anyway. The downside by "prepaying" the CG tax is not much if it's just for a year or two. I kept long-term capital gains that I don't expect to realize for decades intact. Tax bracket considerations for me and spouse also played a role.

I heard of two creative ways to have your cake and eat it too: transfer appreciated assets to spouse or a holding company, in return for a promissory note / shares (respectively). Such transfers *when reported in next year's taxes*, i.e. *after* this year's budget will have gone one way or other, can be elected to have occurred either at book or market value, so you can elect then whether the gains are being crystallized or not. But all such transfers have side effects, and only postpone the decision for a while, i.e. not robust if the govt delays and then makes a final determination only next year. By now, too late for either of them anyway.
Deal Addict
Feb 9, 2009
3025 posts
769 upvotes
It's ok, if Junior tries to mess this around, it'll be reverted back by the Cons in 2019 when that turd gets kicked out.

I always get a kick asking people "how has Trudeau improved your life since he came into office" to a blank stare.
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Dec 7, 2007
200 posts
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0
Sanyo wrote:
Mar 20th, 2017 11:58 am
It's ok, if Junior tries to mess this around, it'll be reverted back by the Cons in 2019 when that turd gets kicked out.

I always get a kick asking people "how has Trudeau improved your life since he came into office" to a blank stare.
You obviously haven't asked any low income individuals with a bunch of kids.

True story - in my role I was introduced to a woman who was on disability and had 5 kids - all under the age of 12 (3 under the age of 6). Thanks to the increase in child benefits she was pulling in the after-tax equivalent of almost $100k (including disability payments).

I would wager she is a big JT fan - and he has improved her lifestyle considerably.

That said - I would agree with you. Most people have been negatively impacted (more so if you earn a decent wage) but still love the guy. Very few associate themselves with the upper class regardless of their financial health. As such the constant preaching of supporting the "middle class" resonates with most individuals and their identities. It's pandering to the self-identified majority.

I wager he gets reelected in 2019 based on popularity associated with his persona and perception as opposed to his policies. Most people are too blind to understand the impact that "supporting the middle class" has had on their own bottom line and will vote for him again.
Jr. Member
Dec 30, 1969
106 posts
35 upvotes
The refugee story will likely end up being a bigger issue than the economy and taxes and possibly lead to the Liberal Party's election defeat if the current trickle of illegal crossings turns into a flood when weather warms up
Deal Addict
Feb 9, 2009
3025 posts
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toolioiep wrote:
Mar 20th, 2017 12:30 pm
You obviously haven't asked any low income individuals with a bunch of kids.

True story - in my role I was introduced to a woman who was on disability and had 5 kids - all under the age of 12 (3 under the age of 6). Thanks to the increase in child benefits she was pulling in the after-tax equivalent of almost $100k (including disability payments).

I would wager she is a big JT fan - and he has improved her lifestyle considerably.

That said - I would agree with you. Most people have been negatively impacted (more so if you earn a decent wage) but still love the guy. Very few associate themselves with the upper class regardless of their financial health. As such the constant preaching of supporting the "middle class" resonates with most individuals and their identities. It's pandering to the self-identified majority.

I wager he gets reelected in 2019 based on popularity associated with his persona and perception as opposed to his policies. Most people are too blind to understand the impact that "supporting the middle class" has had on their own bottom line and will vote for him again.
Not to be mean but my first question is why is someone on disability having that many children if she wasnt able to support them before Junior came into power?
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Apr 10, 2010
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Sanyo wrote:
Mar 20th, 2017 11:58 am
It's ok, if Junior tries to mess this around, it'll be reverted back by the Cons in 2019 when that turd gets kicked out.

I always get a kick asking people "how has Trudeau improved your life since he came into office" to a blank stare.
I don't think your wish will be fulfilled in 2019. Canada will be run by liberals for a very long time, because majority of Canadians care too too much about refugees and all the other liberal's "social" causes rather than their own pocket (which they don't understand anyway).

Mark my words. We can re-visit this thread in 10~20 years to verify my prediction.
Newbie
Aug 9, 2015
75 posts
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Parksville, BC
Sanyo wrote:
Mar 20th, 2017 4:29 pm
Not to be mean but my first question is why is someone on disability having that many children if she wasnt able to support them before Junior came into power?
A better question would be: Where's the dad? How come he has left his kids to be financed by the government?
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Sr. Member
Feb 25, 2007
844 posts
295 upvotes
Ottawa
Sanyo wrote:
Mar 20th, 2017 11:58 am
I always get a kick asking people "how has Trudeau improved your life since he came into office" to a blank stare.
513263337 wrote:
Mar 20th, 2017 4:53 pm
Canada will be run by liberals for a very long time, because majority of Canadians care too too much about refugees and all the other liberal's "social" causes rather than their own pocket (which they don't understand anyway).
Well, keeping it to the purely financial, people with income between $45-200k or so have benefited due to the income tax cut in the $45-91k tax bracket. Some of that was clawed back by eliminating/modifying tax deductions, but I know a lot of people incensed, say, at the TFSA limit cut who completely miss that they've saved much more in income taxes than they've lost by the TFSA limit cut. In a way, he's bribing us, not terribly effectively, with our own money, so it's not a good example of truly "improving our [financial] life" but he certainly gave a pretty large chunk of society a financial freebie right off the bat.

More broadly, "liberal/social causes" need to exist in balance with financial self-interest. As someone who deliberately moved back from the U.S. to Canada in spite of lower salaries and higher taxes, largely since I felt much more comfortable with the more socially aware centrist path Canada tends to take, I think looking purely at one's individual financial bottom line year to year is short-sighted. I do wish Trudeau had done more by now, but am happy enough he stopped us generally sliding in the Wrong Direction :)

Returning to the capital gains inclusion rate, I wonder to what extent a higher inclusion rate would change investor behaviour, encourage more longer-term investing in particular. Somehow I doubt that's what they're focusing on, though: I suspect it's purely $ vs political hit.
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Dec 8, 2010
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Sanyo wrote:
Mar 20th, 2017 4:29 pm
Not to be mean but my first question is why is someone on disability having that many children if she wasnt able to support them before Junior came into power?
Thing is, that's none of your business. There could be any number of reasons.
Sr. Member
Jan 14, 2009
623 posts
174 upvotes
Vancouver, BC
Non resident for tax purposes if it gets bad enough. I don't think it will ever reach that point though.
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