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Old 01-09-2011, 09:43 AM   #1
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Regarding TFSA

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The TFSA and capital gains. Capital gains are likewise taxed more favourably than interest income in normal circumstances outside of registered plans and the TFSA. Only half of your capital gains, net of any losses, are taxable.

Capital gains also provide an opportunity for tax deferral because the gains are only taxable when the gain is “realized,” generally through the sale or transfer of the asset. You will not pay any taxes on the “unrealized” gains for as long as you continue to hold the investment.

From a TFSA perspective, the majority of capital gains potential will generally come from equities, although you may also realize some capital gains on bonds and mutual funds under certain circumstances.
Can anyone explain the bolded line?

If I use $10k to make $100k in 5 years and withdraw them afterwards, are those considered "realized"?
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Old 01-09-2011, 10:39 AM   #2
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realized means when you sell it
so if you don't sell it, CRA will not tax you on your gain in market value

When you take out $ out of your TFSA it won't be taxed
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Old 01-09-2011, 11:19 AM   #3
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2011 - Buy ABC Stock for 10k
2012 - ABC up 90k
2013 - ABC up to 100k
2014 - Sell ABC @ 100k --- gain realized in 2014. include 45k in taxable income.


if you use any sort of online brokerage , they will send u a T-3 (or t-5 can't remember) showing your dispositions and resulting gains/losses
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Old 01-09-2011, 11:30 AM   #4
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that sorta defeats the purpose of a tfsa.
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Old 01-09-2011, 12:42 PM   #5
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Wtf, then whats the point of having a TFSA then?
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Old 01-09-2011, 12:56 PM   #6
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if you dont use the tfsa. you will be taxed 50% on proceeds.
if you sell within the tfsa and withdraw money -- its not taxable like Waddy said.
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Old 01-09-2011, 02:01 PM   #7
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Quote:
Originally Posted by tiger_handheld View Post
2011 - Buy ABC Stock for 10k
2012 - ABC up 90k
2013 - ABC up to 100k
2014 - Sell ABC @ 100k --- gain realized in 2014. include 45k in taxable income.


if you use any sort of online brokerage , they will send u a T-3 (or t-5 can't remember) showing your dispositions and resulting gains/losses
they don't give u any tax slips on cap gains/loss, you have to print out the transactions for those

you only get a t3 or t5 for any dividends or interest income
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Old 01-09-2011, 02:38 PM   #8
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^ right, no slips are given, but depending on your broker they will give you a list of your sales
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