All income is not taxed equally. This fact is most prevalent when it comes to the taxation of investment income. From the various types of income available through investments there are three different types of tax treatment.
Interest income is taxed as “regular” income exactly the same as employment income. This means at your highest marginal tax rate which, with the lowest rate of return and the highest tax bite, the least amount of money staying in your pocket.
Dividend income is a distribution of profits from corporations. While this income is also taxed at your marginal rate, because the corporation has also paid income taxes, you receive a “credit” for the amount of income tax previously paid by the corporation on the same income.
Capital Gains provide the best tax treatment and are currently taxed on only one-half of the actual gain. Structuring your investments with taxation in mind will allow you to change your focus from “rate of return” to “how much stays in your pocket”. That’s Real Wealth management. ™
At The Accounting Place we know that taxation is your single largest annual expense and believe that everything we do is part of your wealth building and retention plans. We also believe that no one can know it all, or be an expert in all areas of financial services.
This is why we specialize in taxation and work with a team of experts in their respective fields – either yours or ours – consisting of financial planners, investment advisors, bankers, lawyers, estate and retirement specialists and insurance representatives. This gives you access to the expertise that you need and, with The Accounting Place working as your primary advisor coordinating an overall wealth building plan, we can help you manage your financial affairs to your best advantage – while you do what you do best!
Why give the taxman more than is absolutely necessary by law? The Accounting Place is conveniently located at 154 Grays Road, Stoney Creek. Find out how you can maximize your wealth retention. Give us a call at 1- 866-938-1010.
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™ Real Wealth Management is a trademark of Knowledge Bureau Inc.