Why Day Trading in Tax-Free Savings Account (TFSA) Is NOT Allowed - Court Case Explaine

Are you a day trader looking to maximize your tax-free savings? Did you know that Day Trading in your Tax-Free Savings Account (TFSA) might not be as tax-free as you thought?

Many investors utilize TFSA to build tax-free assets. However, a recent court case has raised questions about whether a TFSA trust remains exempt from tax if it carries on a business of trading qualified investments. While the Appellant argued it does, the Crown said it does not, resulting in a $600k tax bill for the taxpayer.

In this video, we'll dive deeper into this court case, explaining the situation and providing valuable insights. We'll define day trading and examine the eight criteria CRA uses to evaluate trading behaviour in TFSA accounts. Additionally, we'll compare day trading in TFSA and RRSP accounts so that you can make informed decisions about your investments.

Key Moments In This Video
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0:54 - What is a Tax-Free Saving account TFSA?
02:40 - Stock investing in TFSA account
3:06 - Details of the court case
4:35 - 8 criteria CRA uses to evaluate trading behaviour in TFSA accounts
8:42 - Diving deeper into the court case
11:10 - Day trading in RRSP vs. TFSA
12:00 - Verdict of the court case
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Please make sure to speak to a professional that knows your personal situation before making a decision.

If you need to talk to someone on my team, email us at [email protected].

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Real estate Tax planning is a personalized decision and will depend on your situation, priorities, and risk tolerance. Consult with your legal and tax advisors to ensure you get the best personalized advice.
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