# Taxation when transferring stocks to/from non-reg accounts



## FrugalTrader (Oct 13, 2008)

For the tax experts out there, what are the tax consequences of transferring stocks from a single owner non-registered account (me) to a _new _jointly owned non-registered account (me and my wife)? Would there be a deemed disposition on the stocks?


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## stardancer (Apr 26, 2009)

If there is a transfer in kind, the stocks have not been sold so no disposition. If you sell the stock, then re-buy in a new account, then yes there is a disposition.

If your wife will be declaring part of the capital gains/dividends from now on, there would be a deemed disposition, but you would then be exposing yourself to attribution rules, unless you can prove that she has paid for 50% (or whatever %age) for the stocks.

If you continue to declare 100% of the capital gains/dividends on these stocks, then nothing has changed regarding the ownership. A joint account doesn't necessarily mean both own the instruments for tax purposes. My husband and I have two non-registered accounts- one holds stocks (his baby) and we have reported the transactions on his return; the other holds mutual funds, which I have always reported; we both put $$ into the accounts although it was so long ago I couldn't produce any paperwork any more. CRA has never questioned this; they might if I changed the way we reported everything.


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## FrugalTrader (Oct 13, 2008)

Thanks for the response! It may be easier to open a new individual non-reg account in her name for taxation purposes (I'm in a higher tax bracket) that she can fund with her savings. However, the downside is that it's another investment account to manage. The alternative is to sell everything in my existing non-registered account, and transfer cash (along with savings from my spouses savings) to the new account and start over.

As another thought, if I can prove to CRA that my current non-reg account has been jointly funded, can we split the dividends and capital gains from the account?


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## stardancer (Apr 26, 2009)

As another thought, if I can prove to CRA that my current non-reg account has been jointly funded, can we split the dividends and capital gains from the account? 
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Yes, but make sure you have paper backup of the transfers from her savings account to the investment account. I would make up a specific file folder just for this issue. You may not need it ever, but if you do, it's better to be prepared.


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## FrugalTrader (Oct 13, 2008)

Thanks for this. Since I've already claimed taxes on the non-reg account under my name alone, I may play it safe and open a new joint account.


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## humble_pie (Jun 7, 2009)

frugal what's so attractive about your plan is the equality that it means for the 2 partners.

so often in cmf forum we see a model in which one spouse - usually the husband - manages his portfolio more aggressively, meaning more equity loading, while at the same time managing his partner's portfolio more conservatively, meaning more GICs.

of course, over the past decade this has meant that one spouse has done far better than the other. The equity partner's portfolio has outperformed the GIC partner's portfolio, by far.

at the end of the day, suppose a divorce were to occur, or some other calamity. The passive partner is left with a personal investment portfolio that is significantly inferior to the aggressive partner's.

the beauty of frugal's plan is that both partners contribute, own & learn together. It's a lovely model to think about.

there are certainly some problems in planning & creating a dual account like this, so stardancer's contributions on tax record-keeping & other tax aspects are essential. 

possibly naiive suggestion: one or more how-to articles on this topic, with stardancer's suggestions? all you need is a catchy name for the shared model. More couples should be hearing about this, imho.


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## FrugalTrader (Oct 13, 2008)

Thanks for the comment HP, and a great idea for an article. I'm thinking about the integration for overall tax savings for the family. I basically pay all the bills, and my wife, who works part time (and takes dividend payments from a CCPC), accumulates savings for investments.


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