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Rusty69

Canadian Tax Dicussion

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Ok guys, Obviously u have No canadian tax info regarding currency exchange va capitol gains. Can any else help?

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Ah ... No I don't !  Though if and when the time comes, I'm positive there will be hundreds of know-it-alls telling you they know - when in fact the best place may be to check out the CRA site.

 

http://www.cra-arc.gc.ca/E/pub/tp/it95r/it95r-e.html

 

Mind you - this one was put in place in the 80s.  No. 6 states ...

 

6. A taxpayer who has transactions in foreign currency or foreign currency futures that do not form part of business operations, or are merely the result of sundry dispositions of foreign currency by an individual, will be accorded by the Department the same treatment as that of a "speculator" in commodity futures see 7 and 8 or IT-346R. However, if such a taxpayer has special "Inside" information concerning foreign exchange, he will be required to report his gains and losses on income account.

 

 

Therefore it should be treated as a Capital Gain ...

 

Capital Transactions

12. Subsection 39(2) applies to any fluctuation after 1971 of a foreign currency relative to Canadian dollars that results in a gain being made or a loss being sustained. In the case of individuals the rules in that subsection provide that only the amount in excess of $200 of an individual's net gain or loss on the disposition of foreign currency is taxable or deductible as a capital gain or loss.

13. The Department considers that a taxpayer has "made a gain" or "sustained a loss" in a foreign currency only where there has been a transaction resulting in a gain or loss. Subsection 39(2) does not apply where a loss has been made "on paper" but no transaction has taken place. As a result the "accrual" method of accounting for foreign exchange gains or losses is not acceptable for purposes of reporting foreign exchange gains or losses on capital account. The following are examples of the time when the Department considers a transaction resulting in the application of subsection 39(2) to have taken place.

(a) at the time of conversion of funds in a foreign currency into another foreign currency or into Canadian dollars,

(B) at the time funds in a foreign currency are used to make a purchase or a payment (in such a case the gains or loss would be the difference between the value of the foreign currency expressed in Canadian dollars when it arose and its value expressed in Canadian dollars when the purchase or payment was made), and

© at the time of repayment of part or all of a capital debt obligation.

Foreign currency funds on deposit are not considered to be disposed of until they are converted into another currency or are used to purchase a negotiable instrument or some other asset, i.e. foreign funds on deposit may be moved from one form of deposit to another as long as such funds can continue to be viewed as "on deposit". Term deposits, guaranteed investment certificates and other similar deposits which are in fact not negotiable, are considered funds on deposit. Transactions in which foreign currency funds are invested in negotiable instruments such as notes, bonds mortgages, debentures, U.S. government treasury bills and notes and U.S. commercial paper, will require a foreign exchange gain or loss calculation at the time the foreign currency funds are used to purchase these investments and as well, each time such investments mature or are otherwise disposed of, whether or not the funds are rolled over into like securities.

2002-09-06 Date modified: 

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Iwas just told tax Info from an accontenta; If you had 1 million IQD and held it for more than a year, Then First 500k @ 30%, Second $ 495k @ 15% , Third $5,000 @ 15%. This is based on holding investment over 1 year.

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I guess there are No Canuk Tax Lawyers, CPA"s, or Brokers That Deal with Taxes in Dinar Vets Group. If Your out there try and give us Your perspective on Taxes regarding This exchange in Canada.

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Posted this awhile back. Enjoy !!!

 

 

This is not mine, but came from my friend Bee. Copy and save as we are there I believe my fellow Maple Leafs.


pp



I'm hoping we will need this Information real soon. This is Information that I myself collected. The reg's mentioned can be verified by an accountant.

Most accountants have little to no experience with currency traders, so you will need this Information which I received from Revenue Canada, and not a web site or another persons Interpretation. This is REVENUE CANADA talking, a real person.

Under Canadian tax laws we are subject to taxes under Regulation P4037, Section 17, paragraph 12-15. This directly relates to currency traders and tax Implications.

In basic English, its as follows: (Example only) You take your 1 million from selling your Dinars, divide by two. No tax on first $500,000 or 50%. From the second $500,000 Minus your Investment money, say $1000.00. then minus $200.00. The remainder you pay tax on based on your yearly tax rate.

The $200.00 is the exemption allowed for say, you were on holidays and came back with leftover cash. Value jumps and you make a tidy some of say $300.00 over the cost of what you paid for it.

By law, that extra $100.00 must be claimed. Would most claim this small amount? Doubtful, but it is still the law.

As well you have 364 days, before claiming your windfall. This will give you the time to top up RRSP's, and any other legal financial hiding spot.

Remember, pay your taxes and move on, let the other guy/gal look over there shoulder the rest of their lives.

I am not an accountant, nor a financial advisor, just someone who spent way to many hours talking with Revenue Canada.

Now hit the print button, in a couple days were all rich, or at least I'm hoping we are.

 

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