NON-REGISTERED ACCOUNTS
Non-registered accounts are taxable investment accounts available to Canadian citizens. As the name suggests, it is not registered with the Canadian federal government. Non-registered accounts are flexible, offer tax advantages, and have no contribution limits. There are two primary types of non-registered brokerage accounts: cash accounts and margin accounts.
Cash accounts are investment accounts in which income is taxable in the year earned if there are capital gains, dividends, or interest income. A margin account is a type of cash account that allows customers to borrow money to purchase securities. This process is known as purchasing on margin.
Non-registered accounts are investment accounts offered by banks and financial service providers in Canada. Many financial advisors recommend using non-registered accounts for short and long-term investing. These accounts offer a lot of flexibility with consistent liquidity and no contribution limits, as well as a tax benefit.
Dividends are taxed on a gross amount but benefit from a dividend tax credit. Capital gains from investments in non-registered accounts are taxable at only 50% of the account holder’s marginal tax rate. However, interest income is fully taxable at the account holder's marginal tax rate.
Non-registered accounts can be used in conjunction with other types of investment accounts including registered retirement savings plan (RRSP) accounts.
REAL-ESTATE INVESTMENTS
Capital gains from investments in Real-estate are taxable at only 50% of the account holder’s marginal tax rate.
However, these investments can be set up under a corporation to enjoy tax benefits.
Some common types of Real-Estate Investments are:
- Residential House Projects (New Built / Renovations / Re-Sale)
- Multi-House Complex (Joint Venture or Partnership)
- Residential Rentals (Profits from Sale/Lease)
- Commercial Projects (Profits from Sale/Lease)
- Development Projects (Profits from Sale)
- Buy/Sell Properties using Other-Peoples-Money (OPM) OR Leverage against Home Equity, RRSP and Collateral Life insurance Loans.
Contact us to Learn more about how you can contribute to Other Investments and build your investment portfolio.
