is on income therefore the taxation rate when it is withdrawn is in the same category.

So what's the answer? Well, there are a number of strategies that can be employed to reduce your taxation. It is best to talk frankly with either an investment professional at the bank or at an established investment firm. With all the computer investment programs that are available today they can draw out a tax strategy scenario that is beneficial for you now and far in the future. Don't feel burdened to invest with them until you are comfortable. Also, the internet is a great resource and one would benefit by doing their own research.

If one is a little more profit orientated and enjoys the risk, they can also invest privately, (private / municipal bonds, real property, group real estate investments and many other options) but you must determine what makes you feel comfortable. At the end of the da

In Canada we basically have 3 separate tax options when investing our money. It is sometimes confusing and we battle the options of risk security verses rate of return. Unfortunately most of us do not know of any other place to invest other than real estate property or at the bank.

The three types of investment income commonly available to Canadians are:

Interest Income - highest rate of taxation (same category as your employment income) for the individual but considered the most safe in terms of investment security. Usually has the lowest rate of return. Savings accounts, Guaranteed Investment Certificates, Term Deposits and bonds are typical interest earning instruments. They are considered "debt instruments" as when you deposit your money you are in essence lending money from a borrower (bank, government, private investment) for an agreed rate of return.

Dividend Income - preferred tax rate based on income earned via profits generated from sales produced by the company you invested in. Many stocks have dividend payouts that can be used as income without depleting the capital investment. Income earned from rental property would qualify in this category. Dividend income is usually taxed on an annual basis.

Capital Gains - preferred tax rate based on the growth of the investment. Stocks, investment property and Mutual Funds typically fall under this category. There is a personal exemption from capital gains tax if you sell your own home however there are some guidelines and restrictions best left to an investment professional to sort out for you. Depending on the investment structure you may be taxed annually or you may only be taxed at the time of disposition (sell for a profit).

I think of personal investment options much like owning your own store. I hope this simplified analogy makes sense for you.

1) When you buy the property, including land and building, you have made a capital investment. When you sell the property for a profit (property value increases), the profit from the sale of the property is considered a capital gain and taxed on the profit at approximately 50% of the rate you would pay if you invested in a GIC or the tax that you pay on your paycheck.

2) The store sells goods. The profit from the selling of goods is considered a dividend payment which has a reduced tax structure compared to taxation on interest or job income.

3) When you take a salary or if you then take the money that you profited and leave the money in the bank where interest accumulates. This is considered interest or employment income and is fully taxable at the highest rate.

In Canada we also have a well used tax shelter option is called a Register Retirement Savings Plan (RRSP). First of all, an RRSP is not an investment, it's a tax shelter. This tax shelter allows one to reduce their current tax rate by deferring income until it is withdrawn at a later date. It's a great advantage to one in the immediate tax year as the investment is left to grow untaxed and the rule of compounding works to your advantage.

The biggest downfall to an RRSP is that it is considered income when it is withdrawn and is subject to the highest form of taxation...all of it, not just the profit. The tax break that the Canadian government gives you now is on income therefore the taxation rate when it is withdrawn is in the same category.

So what's the answer? Well, there are a number of strategies that can be employed to reduce your taxation. It is best to talk frankly with either an investment professional at the bank or at an established investment firm. With all the computer investment programs that are available today they can draw out a tax strategy scenario that is beneficial for you now and far in the future. Don't feel burdened to invest with them until you are comfortable. Also, the internet is a great resource and one would benefit by doing their own research.

If one is a little more profit orientated and enjoys the risk, they can also invest privately, (private / municipal bonds, real property, group real estate investments and many other options) but you must determine what makes you feel comfortable. At the end of the day

ivate investment) for an agreed rate of return.

Dividend Income - preferred tax rate based on income earned via profits generated from sales produced by the company you invested in. Many stocks have dividend payouts that can be used as income without depleting the capital investment. Income earned from rental property would qualify in this category. Dividend income is usually taxed on an annual basis.

Capital Gains - preferred tax rate based on the growth of the investment. Stocks, investment property and Mutual Funds typically fall under this category. There is a personal exemption from capital gains tax if you sell your own home however there are some guidelines and restrictions best left to an investment professional to sort out for you. Depending on the investment structure you may be taxed annually or you may only be taxed at the time of disposition (sell for a profit).

I think of personal investment options much like owning your own store. I hope this simplified analogy makes sense for you.

1) When you buy the property, including land and building, you have made a capital investment. When you sell the property for a profit (property value increases), the profit from the sale of the property is considered a capital gain and taxed on the profit at approximately 50% of the rate you would pay if you invested in a GIC or the tax that you pay on your paycheck.

2) The store sells goods. The profit from the selling of goods is considered a dividend payment which has a reduced tax structure compared to taxation on interest or job income.

3) When you take a salary or if you then take the money that you profited and leave the money in the bank where interest accumulates. This is considered interest or employment income and is fully taxable at the highest rate.

In Canada we also have a well used tax shelter option is called a Register Retirement Savings Plan (RRSP). First of all, an RRSP is not an investment, it's a tax shelter. This tax shelter allows one to reduce their current tax rate by deferring income until it is withdrawn at a later date. It's a great advantage to one in the immediate tax year as the investment is left to grow untaxed and the rule of compounding works to your advantage.

The biggest downfall to an RRSP is that it is considered income when it is withdrawn and is subject to the highest form of taxation...all of it, not just the profit. The tax break that the Canadian government gives you now is on income therefore the taxation rate when it is withdrawn is in the same category.

So what's the answer? Well, there are a number of strategies that can be employed to reduce your taxation. It is best to talk frankly with either an investment professional at the bank or at an established investment firm. With all the computer investment programs that are available today they can draw out a tax strategy scenario that is beneficial for you now and far in the future. Don't feel burdened to invest with them until you are comfortable. Also, the internet is a great resource and one would benefit by doing their own research.

If one is a little more profit orientated and enjoys the risk, they can also invest privately, (private / municipal bonds, real property, group real estate investments and many other options) but you must determine what makes you feel comfortable. At the end of the da

me of disposition (sell for a profit).

I think of personal investment options much like owning your own store. I hope this simplified analogy makes sense for you.

1) When you buy the property, including land and building, you have made a capital investment. When you sell the property for a profit (property value increases), the profit from the sale of the property is considered a capital gain and taxed on the profit at approximately 50% of the rate you would pay if you invested in a GIC or the tax that you pay on your paycheck.

2) The store sells goods. The profit from the selling of goods is considered a dividend payment which has a reduced tax structure compared to taxation on interest or job income.

3) When you take a salary or if you then take the money that you profited and leave the money in the bank where interest accumulates. This is considered interest or employment income and is fully taxable at the highest rate.

In Canada we also have a well used tax shelter option is called a Register Retirement Savings Plan (RRSP). First of all, an RRSP is not an investment, it's a tax shelter. This tax shelter allows one to reduce their current tax rate by deferring income until it is withdrawn at a later date. It's a great advantage to one in the immediate tax year as the investment is left to grow untaxed and the rule of compounding works to your advantage.

The biggest downfall to an RRSP is that it is considered income when it is withdrawn and is subject to the highest form of taxation...all of it, not just the profit. The tax break that the Canadian government gives you now is on income therefore the taxation rate when it is withdrawn is in the same category.

So what's the answer? Well, there are a number of strategies that can be employed to reduce your taxation. It is best to talk frankly with either an investment professional at the bank or at an established investment firm. With all the computer investment programs that are available today they can draw out a tax strategy scenario that is beneficial for you now and far in the future. Don't feel burdened to invest with them until you are comfortable. Also, the internet is a great resource and one would benefit by doing their own research.

If one is a little more profit orientated and enjoys the risk, they can also invest privately, (private / municipal bonds, real property, group real estate investments and many other options) but you must determine what makes you feel comfortable. At the end of the da

and leave the money in the bank where interest accumulates. This is considered interest or employment income and is fully taxable at the highest rate.

In Canada we also have a well used tax shelter option is called a Register Retirement Savings Plan (RRSP). First of all, an RRSP is not an investment, it's a tax shelter. This tax shelter allows one to reduce their current tax rate by deferring income until it is withdrawn at a later date. It's a great advantage to one in the immediate tax year as the investment is left to grow untaxed and the rule of compounding works to your advantage.

The biggest downfall to an RRSP is that it is considered income when it is withdrawn and is subject to the highest form of taxation...all of it, not just the profit. The tax break that the Canadian government gives you now is on income therefore the taxation rate when it is withdrawn is in the same category.

So what's the answer? Well, there are a number of strategies that can be employed to reduce your taxation. It is best to talk frankly with either an investment professional at the bank or at an established investment firm. With all the computer investment programs that are available today they can draw out a tax strategy scenario that is beneficial for you now and far in the future. Don't feel burdened to invest with them until you are comfortable. Also, the internet is a great resource and one would benefit by doing their own research.

If one is a little more profit orientated and enjoys the risk, they can also invest privately, (private / municipal bonds, real property, group real estate investments and many other options) but you must determine what makes you feel comfortable. At the end of the da

is on income therefore the taxation rate when it is withdrawn is in the same category.

So what's the answer? Well, there are a number of strategies that can be employed to reduce your taxation. It is best to talk frankly with either an investment professional at the bank or at an established investment firm. With all the computer investment programs that are available today they can draw out a tax strategy scenario that is beneficial for you now and far in the future. Don't feel burdened to invest with them until you are comfortable. Also, the internet is a great resource and one would benefit by doing their own research.

If one is a little more profit orientated and enjoys the risk, they can also invest privately, (private / municipal bonds, real property, group real estate investments and many other options) but you must determine what makes you feel comfortable. At the end of the day it is your money and you want to understand the general direction and possible results in the end.