InFormal Trust - Child
I have received conflicting information from cra so I wanted to see what the RFD communuty has to say regarding this situation.
Want to setup a trading account in my newborns name. The purpose would be for me to invest all of her monetary gifts in this account instead of having the money sit in a youth account.
Td offers an informal trust that I can set up in her name and invest proceeds in direct investing account. Once she is 18 the money would legally become hers so it will never be mine. The objective is to use this product so the income on the investments are taxed at her rate which would be 0 until its above 10000.
1. Is this assumption correct or will the investments be taxed at my tax rate?
2. Can I add additional funds from my account to this accounts or can it only be strictly gifts or income from her?
3. What type of mutual funds or stocks would be best for this type of account. Would swap based etf like horizons be best since capital gains are taxed least?
Thanks everyone for your help.