Investors and day traders beware: According to recent reports, the Canada
Revenue Agency (CRA) is looking to collect $75 million in taxes and
penalties arising from mistakes investors are making in their Tax-Free
Savings Accounts (TFSAs). What’s at stake is the possible repayment of most
of the investment, once penalties and interest are factored in. However,
taxpayers may have more rights than may be apparent at first glance.
Q
– I’m an IBM retiree and bought shares through IBM’s payroll deduction
plan, reinvested the dividends, and inherited some. The dividends are quite
nice, but they are taxed as ordinary income in Canada, and there is U.S.
withholding tax of 15%. I have a large capital gain that makes selling the
shares not particularly attractive. But I wonder if that wouldn’t be the
wisest thing to do?
By Mike Keerma
* U.S. stock markets back off record highs.
* BMO shutters income fund.
* Franklin Templeton launches new Canada fund.
* U.S. stock markets back off record highs.
A subdued outlook and declining quarterly earnings from
General Electric Co. (NYSE: GE) put the brakes on a week-long rally in U.S. stock markets, as the big
indices retreated a notch or two in Friday’s session. Still, the
S&P 500 Composite Index hit a record high last week and posted a 0.5% gain on the week overall. The
Nasdaq Composite Index also posted a record high on Thursday, but retreated on Friday, advancing
1.2% for the week. Toronto’s benchmark
S&P/TSX Composite Index also pulled back on Friday as
crude oil prices retreated -2.6% on the week, and as Canada’s June inflation rate
continued below the Bank of Canada’s target. However, the index was about
flat for the week, as energy issues weighed on performance, while stronger
retail sales in May helped cushion a futher decline. The retail sales data
also gave the
Canadian dollar a boost, which closed at US$0.7976 on Friday.
Q
– My fiancé and I are getting married later this summer. With all the
wedding planning taking up our time, we haven’t really been able to discuss
our financial situation in any great detail. Do you have any financial
planning advice for newlywed couples? – Brenda T., Toronto, Ontario
I recently read an interesting article in the
Monty Pelerin’s World website titled “The Trump Effect and Markets – Market Update.” It argued that
the initial “Trump effect” as it relates to the market is wearing off and
is being replaced by the reality that Trump and his ideas may not be
welcome in Washington.
