# Splitting dividends or capital gains with spouse



## kork (Jun 9, 2012)

My wife and I have now both set up unregistered trading accounts. 

We're each putting $1000 into our cash account automatically and then when the time is right and there's enough cash, we purchase shares of "xyz" company or an ETF like VNC.

So far my wife's at $11k and has shares of a couple companies. I'm a little slow catching up so I've just make a transfer.

My question is this. If my wife owns a variety of stocks (Bell Canada and TD Bank for example) and they do exceptionally well, while I own a couple funds such as TELUS and BMO and they flop, what is the best strategy to normalize our income together or is it even possible?

Should we just share the same asset allocation between the two of us or in there something where "families" can split capital gains or dividend payouts (that are dripped)?


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## humble_pie (Jun 7, 2009)

kork said:


> My wife and I have now both set up unregistered trading accounts.
> 
> We're each putting $1000 into our cash account automatically and then when the time is right and there's enough cash, we purchase shares of "xyz" company or an ETF like VNC.
> 
> ...



these are separate accounts in each of your names, i hope? because otherwise - if a joint account - the attribution rules are going to kill with paperwork.

there's nothing where families/couples can split capital gains or dividend payouts from separate investment accounts. Each of you will have your own income results & tax considerations.

it happens frequently in coupledom where the 2 accounts evolve in totally separate directions. A common pattern is for a husband account to do well with common stocks during a bull market while the wife account, which has been conservatively invested in interest-bearing paper, does not perform as well. This pattern can also hold for registered accounts, if each partner invests in different types of securities.

re the DRIPs in non-registered accounts, i'd like to mention something if i may. These are also going to kill with paperwork, especially since you are adding small increments of cash at intervals. You will have to re-bookkeep your cost base every single time you DRIP a dividend. With some divvies, the particles of income that comprise the dividend get even more complicated than simple eligible canadian divvies. Conclusion: DRIP away in RRSP & TFSA, but don't DRIP in non-registered ... not until you have evolved to eclectic's level of tax expertise!

one more hint: bell, telus, td bank & bmo are stocks, not funds. Tax reporting is somewhat easier because the broker will aggregate all the dividends & send you one tax slip. For yourself & your wife, as startup investors, these are good basic choices imho. Wishing you great success.


EDIT: you've both maxed your TFSAs i hope? DRIPPing dividends works beautifully in tfsa accounts. Nothing to record, nothing to report.


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## kork (Jun 9, 2012)

Thanks Humble Pie - I appreciate your patience! Our unregistered accounts are new(ish) territory for me but I'm learning. We've jumped in feet first after reading and reading and reading. It's the details that are complicating things (as you've pointed out).

When my wife and I registered her account, it *WAS* set up a joint. We went in to open it for her, but when they asked the question "do you want it to be joint?" There weren't any discussions about attributions rules, etc.

My account is my own (set it up last month) simply because she wasn't there when I was setting it up. With that said, I've now set up an appointment to close the joint account and re set it up as her own account with me no longer as a "holder."

Secondly, The dripping. ARGH! I thought I was doing a good thing by dripping it. Even made a point to own enough shares to cover the purchase of another share with the drip. Nothing has actually dripped yet and it's relatively simple to "turn off." So I'll do that.

RRSP's and TFSA's are maxed, yes. But our RRSP's and TFSA are couch potato index funds and we're both balanced pretty much the same. Both accounts are within a thousand dollars of each other.


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## kork (Jun 9, 2012)

One thing to note is that the money for my wife's account is coming from her account and from her own income. Not sure is that makes the attribution stuff simpler for the "past" but we'll get it fixed up moving forward.


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## humble_pie (Jun 7, 2009)

your RRSPs & TFSAs sound lovely! good for you.

you've also done very well with your studies & readings in finance. Yes, DRIPs are fabulous ... when they're happening in registered accounts.

in a non-registered account, each DRIP dividend means a tiny new acquisition of new stock so presto! the cost base changes. 

me i sort of swoon when i even think about things like that. Income tax time is bad enough. So in non-registered, me i take cash dividends.

another thing to compliment you on: the young generation outlook. There's none of the my-wife-doesn't-understand-finance-so-i-have-to-protect-her-with-GICs mindset that we occasionally see among us old phartz. On the contrary, your wife is in there buying up a storm & probably doing very well.

i like that you're contemplating a few basic core stocks in non-registered. A few years ago cmffer Argonaut used to post about his 5-Pack investment account. It was for a TFSA. Just pick 5 winners & sidestep all the losers in an index ETF, argo used to write. 

the argonaut liked: a telco, a bank, CN rail, a pipeline & a utility.

then cmf member Eder went argo one better & posted how he'd refined the approach down to 3 stocks only. They were for his daughter's account. She'd be a millionnaire by her late 20s, Eder said, & indeed i rather suspect that this will be the case.

Eder's 3 stocks? RY, BCE & i believe CNR. This micro-portfolio has probably enjoyed the very best performance of any investment portfolio in cmf forum, over the past 6 years.


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## kork (Jun 9, 2012)

So I've now had the DRIPPING turned off on my wife's unregistered accounts. Any dividends will be paid into the cash portion of her account.

But I'm still on the edge with the joint vs. independent account.

I was just speaking with a TD Investment representative and they said that a joint account can be much better for estate planning. 

So my question now is this?

Should My wife and I each have a joint account, but that only one of us contributes to? So my wife's "joint" account has her contributing from her banking account and mine is the same? I don't contribute anything to hers and she doesn't contribute to mine. Does this satisfy the attribution challenges and paperwork?

*OR*

Should we each have our own separate accounts where we each contribute to from our banking account?


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## kork (Jun 9, 2012)

Also, thank-you for the kind words Humble Pie. Still lots to learn, but I don't want to be 10 years to retirement only to be trying to catch up. So we're trying to establish a strong base to grow from. Not get caught up in day trading or "stock of the month."

While my wife doesn't have much interest in investing, I'm trying to share as much as I can with her that she'll "care to listen to." Now that she see's the money growing though, she's taking on more of an interest in this "free magical money"

I like the idea of owning a few monolithic stocks and letting time be good and possibly benefitting from dollar cost averaging. I'm also a fan of more diversification as I have no clue what the futures holds (and I work in technology).

Over the next 5-10 years I'd like to max out everything and grow the unregistered accounts into nice, consistent dividend paying sources , then... slow down a bit and still allow the investments to grow for the remaining 10-15 years before we need them. That's part of where the plan is now anyways...


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## My Own Advisor (Sep 24, 2012)

FWIW Kork, once my wife's RRSP is maxed (a few years), I will be setting up a non-reg. account for her, in her name. No joint account. Too many headaches associated with that.

With her account set up, I will create a new savings account in her name only; this way, any contributions from savings to non-reg. for investing avoid any attribution challenges or speculation.


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## humble_pie (Jun 7, 2009)

^^

kork you wouldn't each have a joint account. A joint account is, well, joint ...

as i understand things, attribution records have to be meticulously kept. There are annual income declarations to be made & taxes to be paid. So the income allocations have to be pro-rated.

as for estate planning, perhaps the big green meant a joint account with right of survivorship? but i'm left wondering whether you even have children yet, i mean surely it's not yet the time to be sweating snowballs about one of you departing this dear earth & leaving a mate who will be thrilled silly over the rights of survivorship ...

there are several ways to guarantee access to funds if one partner in a couple does unfortunately pass away. But perhaps jump off that bridge later, after one gets to it shall we say .each:


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## AltaRed (Jun 8, 2009)

The way to handle this situation (keeping track of attribution of income) for non-registered accounts is to have 2 JTWROS accounts, one with the OP's name first (and the one that only he makes contributions too from his personal bank accounts) and the other with his spouse's name first (and the one only she makes contributions too from her personal bank accounts). That way, attribution is clear for each of these, as is the paper trail for tax purposes every year. 

This is the way spouse and I handled the situation for decades. JTWROS accounts have advantages in estate planning in that on the death of one spouse, the assets automatically* pass on to the surviving spouse (assuming of course the surviving spouse is the beneficiary named in the will). Joint accounts also avoid probate but can have consequnces beyond the scope of this thread.

* too many people mess up their estate situation by having joint accounts to avoid probate and yet include other people as beneficiaries in the will. For example, it becomes a real mess if all accounts are joint with a spouse and thus the assets automatically pass on the surviving account holder, but at the same time, the will specifies that maybe 50% goes to the surviving spouse and 50% to other parties. The executor of that will could have a very rough time trying to distribute proceeds to other parties when the surviving spouse may have gotten it all due to joint accounts, joint title to the house, etc.


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## kork (Jun 9, 2012)

humble_pie said:


> ^^
> 
> kork you wouldn't each have a joint account. A joint account is, well, joint ...
> 
> ...


Very insightful and you're honing in on the linchpin! 

We just got back from the bank and they suggested the same thing. The account was likely set up as "joint" because we don't yet have a will (not responsible, I know)... Thing is, when you're under 40, even with kids your own mortality isn't really a "top of the chart" priority. A will is on the "to do" list just like "clean the house, get an oil change or sign the kids up for soccer)... However, now we have a show stopping reason to do one so we'll be looking to have a will done up this week. Wondering if Lawyers are the best way to do this, or a good "kit" to DIY.

So what I think we'll do is have a will done up and then make both accounts individual accounts. That way, my wife's is hers and mine in mine. 100% separate.

BTW - yes, we have children.


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## humble_pie (Jun 7, 2009)

AltaRed said:


> The way to handle this situation (keeping track of attribution of income) for non-registered accounts is to have 2 JTWROS accounts, one with the OP's name first (and the one that only he makes contributions too from his personal bank accounts) and the other with his spouse's name first (and the one only she makes contributions too from her personal bank accounts). That way, attribution is clear for each of these, as is the paper trail for tax purposes every year.
> 
> This is the way spouse and I handled the situation for decades. JTWROS accounts have advantages in estate planning in that on the death of one spouse, the assets automatically* pass on to the surviving spouse (assuming of course the surviving spouse is the beneficiary named in the will). Joint accounts also avoid probate but can have consequnces beyond the scope of this thread.
> 
> * too many people mess up their estate situation by having joint accounts to avoid probate and yet include other people as beneficiaries in the will. For example, it becomes a real mess if all accounts are joint with a spouse and thus the assets automatically pass on the surviving account holder, but at the same time, the will specifies that maybe 50% goes to the surviving spouse and 50% to other parties. The executor of that will could have a very rough time trying to distribute proceeds to other parties when the surviving spouse may have gotten it all due to joint accounts, joint title to the house, etc.



kork here you can see altaRed's genius at work - he's the best resource you could have from this forum, for your retirement & estate planning needs.

so if a couple *must* have a joint account, it's best to have 2 separate joint accounts WROS, since the separate pair will make the attribution record-keeping as easy as pie? this does make sense.

re the will & the inclusion of other heirs: presumably their bequests could be dealt with as separate legacies to each named heir, since payout of legacies by an executor precedes distribution of the residue of an estate. This might mean fairly frequent revisions to a will though - often accomplished by a codicil - if an estate grows in wealth & a testator wants to increase the size of each legacy.

or decrease the size, if malfortune strikes or a potential heir falls out of favour .each:


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## Retired Peasant (Apr 22, 2013)

kork said:


> ... there something where "families" can split capital gains or dividend payouts (that are dripped)?


May not apply to your circumstances, but just in case, from Line 120..

"In some cases, it may be better for you to report all the taxable dividends your spouse or common-law partner received from taxable Canadian corporations. You can do this only if, by including the dividends in your income, you will be able to claim or increase your claim for the spouse or common-law partner amount (line 303 of Schedule 1).

If you use this option, you may be able to take better advantage of the dividend tax credit. Do not include these dividends in your spouse's or common-law partner's income when you calculate claims such as the spouse or common-law partner amount on line 303 or amounts transferred from your spouse or common-law partner on Schedule 2."


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## kork (Jun 9, 2012)

AltaRed said:


> The way to handle this situation (keeping track of attribution of income) for non-registered accounts is to have 2 JTWROS accounts, one with the OP's name first (and the one that only he makes contributions too from his personal bank accounts) and the other with his spouse's name first (and the one only she makes contributions too from her personal bank accounts). That way, attribution is clear for each of these, as is the paper trail for tax purposes every year.
> 
> This is the way spouse and I handled the situation for decades. JTWROS accounts have advantages in estate planning in that on the death of one spouse, the assets automatically* pass on to the surviving spouse (assuming of course the surviving spouse is the beneficiary named in the will). Joint accounts also avoid probate but can have consequnces beyond the scope of this thread.
> 
> * too many people mess up their estate situation by having joint accounts to avoid probate and yet include other people as beneficiaries in the will. For example, it becomes a real mess if all accounts are joint with a spouse and thus the assets automatically pass on the surviving account holder, but at the same time, the will specifies that maybe 50% goes to the surviving spouse and 50% to other parties. The executor of that will could have a very rough time trying to distribute proceeds to other parties when the surviving spouse may have gotten it all due to joint accounts, joint title to the house, etc.


So if my wife has a joint trading account and I have my own trading account, how can I find out if my wife's account is a JTWROS account? Is it a special request or is it a fancy name for what would otherwise be considered a joint account?

As it exists, my wife has made every contribution to the joint account from her own bank account. She's working and her income is higher than the contribution. For my account, I've put in everything from my own banking account. So while hers is a "joint" account, we're very much treating it as hers.

Nobody else would be beneficiaries beyond our little family. If my wife and I both go, my parents would take the kids and I suppose we'd have an estate or trust set up for the kids which would pay for them growing up, school, etc.

I guess that's where we'll need to seek the services of a lawyer.


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## AltaRed (Jun 8, 2009)

kork said:


> So if my wife has a joint trading account and I have my own trading account, how can I find out if my wife's account is a JTWROS account? Is it a special request or is it a fancy name for what would otherwise be considered a joint account?
> 
> As it exists, my wife has made every contribution to the joint account from her own bank account. She's working and her income is higher than the contribution. For my account, I've put in everything from my own banking account. So while hers is a "joint" account, we're very much treating it as hers.
> 
> ...


It is most likely that your wife's account is a JTWROS account. Take a look at the signed paperwork you still have, right? If not, simply ask your broker or look at their blank application forms online. There is no reason to change your accounts. Your spouse can still operate the Jt account as her own (100% attribution of income to her) and you can operate your Individual account obviously as 100% attribution of income to yourself..... assuming of course that you each contribute your own money to your own accounts.

I have never believed in online will kits. A decent lawyer will ask you a lot of 'what if' questions* that you may not have thought of that may prove invaluable. Being penny wise and pound foolish can result in severe regrets. Consider it the same way as you pay for home or auto insurance......just in case.

* such as what are the payouts in a trust for your children? When can/will they be able to access the funds? All at 18? In installments over time to age 25 or 30? What happens if your parents (guardians) die in the same car crash as you and your spouse? Who is the alternate? Who do you trust being the executor of your estate? And who is the alternate in case the primary executor pre-deceases you? gets Alzheimers? cannot act for one reason or another? There are tons of such questions when you are preparing your Will. The kit from WalMart likely does not cut it. What about your Health Directives? What about your POA or your Enduring POA?


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## twa2w (Mar 5, 2016)

AltaRed said:


> It is most likely that your wife's account is a JTWROS account. .....
> 
> I have never believed in online will kits. .... What about your POA or your Enduring POA?


In terms of brokerage accounts, Altared is likely right. Unless you specified otherwise when you opened it, it would be a JWROS.

I would suggest one of two things in terms of your non-registered account(s).

If both you and your spouse contribute specific amounts each month or year to your non-registered accounts, you could have one joint non-registered account. This would allow you to split capital gains/interest/dividends between the two of you on the % basis of your contributions. In other words if the contributions to the account are equal, you could split any income 50/50. (dividends can be claimed by whichever spouse it is most advantage for as noted by a previous poster.
If your contributions are 60/40 then that would be the basis of your taxable split. again dividend excepted. 
This split would be regardless of whether you and 
your spouse kept track of who had what investments within the account.

|The simpler option of course is to have two JWROS accounts with one account having your spouse as primary and one with you as primary. This way the tax slips will have the primary holders name on them for ease of tracking. The JWROS makes it simple for survivorship obviously but also in case one of you needs to trade on the other parties account in the case of a disability, someone out of town etc. This is assuming no marital problems 

Otherwise you can have individual accounts but could grant each other trading authority. This would allow either party to make trades but they would not be able to withdraw funds nor would they have right of survivorship. Trading authority would cease on death or incapacity.

I agree with Altared on the estate issue as well. Get a lawyer to do your wills - preferable a lawyer with some experience in wills and estates not your real estate lawyer. Most lawyers will add a POA and a POA for Personal Care(aka living will, personal directive) for a nominal amount.
You will should be thought about in the context of 'what if I die tomorrow', and 'what if I make this will and live to 80 and never make another will'. So it should provide for unborn children, spouse/child predecease with or without grandchildren etc etc.

Hope this helps
Cheers.

oh btw, some brokerage accounts will keep track of ACB on accounts and this includes drips and subsequent purchases and sales. Usually the only thing they don't include in the ACB is the commission to buy and sell. But not all brokerages do this. If you are the type who like accounting/paper work, it is a simple thing to record any drips each month when you get your statement. There are programs that simplify this process as well as keeping your own simple spreadsheet. However if you are not this way inclined it is a pain in the butt. Personally I am not the type to do this as I hate the paperwork.


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## AltaRed (Jun 8, 2009)

twa2w said:


> oh btw, some brokerage accounts will keep track of ACB on accounts and this includes drips and subsequent purchases and sales. Usually the only thing they don't include in the ACB is the commission to buy and sell. But not all brokerages do this. If you are the type who like accounting/paper work, it is a simple thing to record any drips each month when you get your statement. There are programs that simplify this process as well as keeping your own simple spreadsheet. However if you are not this way inclined it is a pain in the butt. Personally I am not the type to do this as I hate the paperwork.


This is a good point that has not had much discussion anywhere on financial forums that I am aware of and may be worthy of its own thread. The question is which brokerages? We will need clients of various brokerages to respond. I've not spent any time trying to figure out whether BMO IL, Scotia iTrade or RBC DI do this reliably, the operative word being reliably and consistently BUT I will say RBC Direct Investing did a good job of my mother's ACB (book value as they call it) on the one mutual fund she had that had ROC. The question here is whether that was RBC Direct Investing's doing OR it was provided by RBC Asset Management/RBC Investor Services and supplied to RBC Direct Investing. That I don't know.....and if it was supplied to RBC DI, does RBC DI reliably keep track of ACB on ETFs with phantom distributions. That is the ultimate question.

P.S. A brokerage keeping track of ACB does not do anyone any good if they hold the same security in another non-registered account. The ITA requires the investor to aggregate/consolidate identical securities in an individual's name and come up with the weighted average ACB.


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## Numbersman61 (Jan 26, 2015)

AltaRed said:


> This is a good point that has not had much discussion anywhere on financial forums that I am aware of and may be worthy of its own thread. The question is which brokerages? We will need clients of various brokerages to respond. I've not spent any time trying to figure out whether BMO IL, Scotia iTrade or RBC DI do this reliably, the operative word being reliably and consistently BUT I will say RBC Direct Investing did a good job of my mother's ACB (book value as they call it) on the one mutual fund she had that had ROC. The question here is whether that was RBC Direct Investing's doing OR it was provided by RBC Asset Management/RBC Investor Services and supplied to RBC Direct Investing. That I don't know.....and if it was supplied to RBC DI, does RBC DI reliably keep track of ACB on ETFs with phantom distributions. That is the ultimate question.
> 
> P.S. A brokerage keeping track of ACB does not do anyone any good if they hold the same security in another non-registered account. The ITA requires the investor to aggregate/consolidate identical securities in an individual's name and come up with the weighted average ACB.


Never ever trust your broker to keep track of your ACB. The possibility of a screw-up is very great. If it's too complicated for you to do it, use a competent accountant. I've been a CA for many years and have taken the in depth tax course but still use a tax specialist for advice.


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## OnlyMyOpinion (Sep 1, 2013)

Anyone familiar with using a spreadsheet program like excel or Google sheets shouldn't be intimidated by tracking DRIP's and ACB. If you are not familiar or don't care to do it, then you'll never know the power and simplicity of growing your assets through DRIP's.

Re/ brokerage book value (ACB), my past checks of TDDI showed their values to be correct, even when we had US stocks DRIP'ing and converting within a $Cdn account. This is only true if you have always bought and DRIP'd that equity within the account (i.e. not transferred shares in from outside the account). I still track them myself though (about 25 entities - common, reits, mf's - payable quarterly and monthly - over many years).

Re/ OP. I agree that attribution rules - who contributed the money and hence has to claim the income - is a gnarly issue in a single joint account where spousal income has varied over the years. Kudos for thinking about it and doing it correctly from the start.


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## Eclectic12 (Oct 20, 2010)

humble_pie said:


> .... re the DRIPs in non-registered accounts, i'd like to mention something if i may. These are also going to kill with paperwork, especially since you are adding small increments of cash at intervals. You will have to re-bookkeep your cost base every single time you DRIP a dividend ...
> Conclusion: DRIP away in RRSP & TFSA, but don't DRIP in non-registered ... not until you have evolved to eclectic's level of tax expertise!


A good point about the workload ... plus I appreciate the mention.

"Kill" is a YMMV situation where there a lot of factors at play so I thought I'd point out that having a taxable account means one needs to have a bookkeeping system as well as be prepared for the adjusted cost base (ACB) calculations from buy/sells/return of capital (RoC) paid.

DRIPs are simply automatic purchases where one does not a commission and has no control over what price was paid. It is simply adding scheduled buys where one has to look up the price paid and add it as well as the number of additional shares to one's numbers.

Where one sticks to the recommended ten stocks, AFAICT the maximum extra buys the DRIP will create are where the dividends are paid monthly to end up with 10 x 12 or 120 extra entries. If it pays the dividend on the more traditional schedule of quarterly, that's 10 x 4 = 40 entries.

Being comfortable with spreadsheets that have the needed formulas built in, this might be half an hour a year. Where one is working off pencil and paper, YMMV. (It would kill me but mom happily checked the company DRIP numbers this way.)


Definitely if one has not worked out a system yet ... skipping the DRIP will reduce one's work but it is work that must be understood anyway if one hopes to protect oneself from errors by the broker or be confident that one is paying the correct taxes.




humble_pie said:


> ... With some divvies, the particles of income that comprise the dividend get even more complicated than simple eligible canadian divvies.


This is an investment that pays mixed income such as a REIT or ETF or exotic shares. Having had to deal with it after the info was not so easy to get ... I agree that until it is understood it should be avoided. I now check the tax breakdown before buying to avoid surprises. 

More Info:
http://www.theglobeandmail.com/glob...our-head-around-reit-taxation/article5575073/
http://www.taxtips.ca/personaltax/investing/taxtreatment/etfs.htm


The key point is to avoid buying them in the first place as holding them adds reporting the mix of income types with different tax reporting. DRIPs only add extra buy transactions to the bookkeeping.




twa2w said:


> ... oh btw, some brokerage accounts will keep track of ACB on accounts and this includes drips and subsequent purchases and sales. Usually the only thing they don't include in the ACB is the commission to buy and sell. But not all brokerages do this.


A G&M article on REITs had the author commenting that both brokerages showed what looked like the ACB but one correctly adjusted for the RoC the REIT paid and one didn't. Just because it says "cost" or "ACB" on the broker's report does not mean it is what one needs.

Then too, where one transferred stocks from one broker to another ... likely the "cost" at the second broker is going to be the trading price on the day transferred instead of the ACB.

Where one has run the numbers to confirm the broker is taking everything into account ... that is fine. Trusting without checking means one can be paying more tax than one is required to.




twa2w said:


> ... If you are the type who like accounting/paper work, it is a simple thing to record any drips each month when you get your statement. There are programs that simplify this process as well as keeping your own simple spreadsheet. However if you are not this way inclined it is a pain in the butt. Personally I am not the type to do this as I hate the paperwork.


The trade off is that where one trusts what one is given ... if it is right - all is good but one won't know this.


Cheers


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## kork (Jun 9, 2012)

Wow, this is getting really complicated.

I was expecting that my wife and I would receive a T5 and then input that on our personal tax return. 

For example, in 2015, my wife received a $32.50 dividend from her BCE stock and it was put back into her cash account. I thought she'd get a T5 and that would be that and any capital gains would need to be claimed until the stock were sold (which, with the stocks we're looking to purchase would be buy and hold for... well, hopefully forever).

I've never seen a T5 for invested income, but had assumed that it would be similar to a t4 in the sense that, here's line number "x" and input it on line "x" on your tax return.

This year, we'll each be receiving about $400 in dividends so a little bit more to learn with...

Am I reading that it is, in fact, much more complicated with unregistered investments?


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## OnlyMyOpinion (Sep 1, 2013)

Kork,
I would say that if you are taking your dividends as cash from the likes of BCE, then it will be as simple as you describe. You will get a T5 with the taxable amount of eligible dividends reported in box 25. If you own multiple dividend paying companies in the account you will see the total on your T5 and you should also get a statement from your broker that summarizes all of the dividend payments paid out during the year. 

Your ACB will just be your original purchase price plus any commission you paid when purchasing and you won't report any capital losses or gains until you actually sell the shares. 

It is possible that future share splits or other 'oddities' (like a return of capital) could occur with BCE but they would be few and far. 
If you buy additional or sell some BCE shares, begin to DRIP, or buy a REIT there will be more tracking involved. Depending on you, this may or may not be a show stopper. The CRA and Taxtips site, and lots of others offer insight.

I would say that these should not prevent you from investing in equities for long term growth, even in a non-registered account. Once TSFA's and RRSP's are max'd out, there really aren't a lot of other long term 'plain vanilla' alternatives to equities or etf's for your non-registered account that will keep you ahead of inflation these days.


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## kork (Jun 9, 2012)

Thanks OMO, that's very reassuring.

I was getting caught up in the "what have I done?" mindset!

Like everything, it's a learning process for us and I appreciate all the insight from members of this forum.


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## kork (Jun 9, 2012)

OnlyMyOpinion said:


> If you buy additional or sell some BCE shares


Just read again and this jumped out. My wife did purchase additional BCE shares at the beginning of the year. So she bought 50 last year and an additional 50 very early this year.

Beyond information on a T5, how would this complicate things?


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## OnlyMyOpinion (Sep 1, 2013)

Not much. Your ACB is now just the sum of your two purchases (incl commission) - divided by the total shares you own if you want to calculate on a per share basis.

http://www.cra-arc.gc.ca/tx/ndvdls/tpcs/ncm-tx/rtrn/cmpltng/rprtng-ncm/lns101-170/127/clc-rprt/djstd/menu-eng.html
http://www.taxtips.ca/glossary/adjustedcostbase.htm

This doesn't complicate or impact the T5 other than the fact that you are getting twice the dividends now. Nice to have recieved a 5.3% 'raise' when BCE increased their dividend in Feb.


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## kork (Jun 9, 2012)

Okay, perfect. Thanks!


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## twa2w (Mar 5, 2016)

Just to add to the tracking of acb issue .
Some brokers do a very good job of this, including obtaining acb from other brokers when shares are transfered in. I had shares of ry in non reg acct with a drip, and some in a employee sayings account, when I transferred the employee savings account to the non reg acct, the merged acb was correct.
But if you have owned shares for a long time it may not be accurate as most only started tracking acb 10 years or so ago.
If you have the same sevpcurity in multiple non reg accounts it won't work.
Some brokers do not do a great job of this but they are getting better. Better to track yourself for a while to ensure proper tracking.


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## Eclectic12 (Oct 20, 2010)

kork said:


> ... I was expecting that my wife and I would receive a T5 and then input that on our personal tax return.


Where she has her own taxable account and you have your own taxable account ... sure. That's the way my sister and brother-in-law have their taxable accounts setup.

As soon as it is joint ... I am not sure how the financial institution would report it.





kork said:


> ... I've never seen a T5 for invested income, but had assumed that it would be similar to a t4 in the sense that, here's line number "x" and input it on line "x" on your tax return.


The T5 is going to have the eligible dividend income where likely box 24 "Actual amount of eligible dividends", box 25 "Taxable amount of eligible dividends", box 26 "DTC for eligible dividends" are filled out. The T5 is "investment income" so that is all that will be on it.


If one has mistaken an investment that pays multiple types for income instead of say BCE that pay 100% eligible dividends, then one will receive a T3 "Statement of Trust Income Allocations and Designations". It has the ones the T5 has but also has a boxes for CG, CG eligible for deduction, Actual amount for dividends other than eligible dividends (known as non-eligible dividends on some tax web sites), other income and such.




kork said:


> ... Am I reading that it is, in fact, much more complicated with unregistered investments?


Nothing to report in a registered account versus at minimum, CG or CL from the share sale and possibly yearly income that ranges from one income type through five or six income types ... yes, it is more complicated and entries on one's tax return.

Once one understands what to look for ... it is not as bad as it seems at first. 

Borrow a good investment book from the library or tax book that covers investments ... look for one that walks through an example, step by step. I found that a good introduction. You can use articles on the web as well as posts here but I find they are more piece meal where a chapter gives a good overview.


Whatever way you learn the best ... learning a bit at a time is more important than what resource to use.


Cheers


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## Spudd (Oct 11, 2011)

Eclectic12 said:


> As soon as it is joint ... I am not sure how the financial institution would report it.


For a joint account you receive a single T5 representing the joint account. On your tax return you would enter the T5 on both people's returns and specify the percentage that applies to each (unless, like AltaRed's situation, both are really individual accounts, then I don't think you need to put it on the other person's return).


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## Eclectic12 (Oct 20, 2010)

kork said:


> ... Beyond information on a T5, how would this complicate things?


The only change on the T5 is that the additional shares will pay more dividends so that where one may have started the year at 100 shares, one will see on the T5 that box 24 is larger than 100 x the scheduled payout. For example, if 100 shares paid out $0.65 a quarter, because one held more shares that paid dividends, box 24 should be larger than 100 x $0.65 or $65.

Of course, if BCE increases the dividend during the year, box 24 may be larger than last year's, even if there were 100 shares in Jan and the same in Dec (i.e. during that particular tax year).


The bigger impact is the owner of the shares has to update their cost base (or confirm the brokers version is correct) by adding the cost of the additional shares. See the "Tracking multiple buys" section of this G&M article.
http://www.theglobeandmail.com/glob...he-abcs-of-tracking-your-acb/article17838427/

The other "multiple" to be concerned about is where one owns shares in multiple taxable accounts. What has to be used for the tax return is the sum of all taxable account.
It does not sound like you are in this situation but I though I would point it out.


Cheers


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