Thanks Cherry for a well presented albeit complex subject, an invaluable information given current bearish market conditions both in cryptos and stocks.
You highlighted 6- criteria to help determine if an activity is business income or capital gains. Where do you reckon I fall: 1) I trade frequently up to 21 trades a week. 2) I hold about 50% of my positions between a week or two and the other 50% 6 months to 12 months. 3) My knowledge is fair or below average. 4) No 5) < 20% of my time as I have a full time job in healthcare 6) I trade CFD’s (contract for difference), a leveraged index product. I am positive on two of the criteria (1 & 6). Do I qualify for business income?
Wish I am in the power to give you a definitive answer...unfortunately, this is really based on case fact specific, and sometimes it is up to the judge and the circumstances presented in court... I would suggest you to speak to your accountant who know your situation well to begin with...and then go from there.. If you aren't currently working with a professional accountant, feel free to reach out to our office and our team maybe able to assist you...
so me day trading in my margin account . holding some positions for 1 week, some longer some shorter, if i have capital gain and losses its business loss and gain? i always thought it was capital,. this my first time usuing margin account ill need help with taxes this year
Great video Cherry. Regarding the Capital gain / loss, can they be carried over and for how long? Can you use a capital loss for a previous year as business loss?
Capital gain/loss can be carried back for 3 years and can be carried forward indefinitely. Capital gain/loss can only be offset against capital gain...not business income. Business loss, however, can be used to offset against all income.
Absolutely, but you need to make sure that your documentation of your intention with respect to each property must be strong. Typically there're multiple corporations involved.
Hi Cherry, I have been searching for how rental losses are treated from tax deduction point of view but couldn’t find a clear answer. If a landlord with one rental property incurs net rental loss, can it be deducted from the employment income? Please advise.
Generally if there's a loss, it is used to offset against other income. However, if you report multiple years of losses - it may become a red flag for CRA to audit you.
@@RealEstateTaxTips Dear Cherry, would you be willing to explore this topic in a video? I'm reading about people receiving letters from CRA asking to provide a "detailed business plan" to turn their rental property from loss to profit. Due to the repeated interest rate hikes and our rental property being on a variable rate mortgage, we are now in the unfortunate position to be losing money on our rental property. The only "business plan" we have is to wait for rate reductions, since we can't raise rent due to LTB rules. I'd love to know if there are any other strategies to mitigate losses, or suggestions you would have from an accounting POV to avoid having losses denied at CRA. Thanks!
Thanks Cherry for a well presented albeit complex subject, an invaluable information given current bearish market conditions both in cryptos and stocks.
You highlighted 6- criteria to help determine if an activity is business income or capital gains. Where do you reckon I fall:
1) I trade frequently up to 21 trades a week.
2) I hold about 50% of my positions between a week or two and the other 50% 6 months to 12 months.
3) My knowledge is fair or below average.
4) No
5) < 20% of my time as I have a full time job in healthcare
6) I trade CFD’s (contract for difference), a leveraged index product.
I am positive on two of the criteria (1 & 6). Do I qualify for business income?
Wish I am in the power to give you a definitive answer...unfortunately, this is really based on case fact specific, and sometimes it is up to the judge and the circumstances presented in court...
I would suggest you to speak to your accountant who know your situation well to begin with...and then go from there..
If you aren't currently working with a professional accountant, feel free to reach out to our office and our team maybe able to assist you...
so me day trading in my margin account . holding some positions for 1 week, some longer some shorter, if i have capital gain and losses its business loss and gain? i always thought it was capital,. this my first time usuing margin account ill need help with taxes this year
Great video Cherry. Regarding the Capital gain / loss, can they be carried over and for how long? Can you use a capital loss for a previous year as business loss?
Capital gain/loss can be carried back for 3 years and can be carried forward indefinitely.
Capital gain/loss can only be offset against capital gain...not business income.
Business loss, however, can be used to offset against all income.
Can someone be both an investor and a flipper at the same time if he buys some properties for long term and some for short term ??
Absolutely, but you need to make sure that your documentation of your intention with respect to each property must be strong. Typically there're multiple corporations involved.
great video cherry.
Thank you!
Thank you.
Glad you find it useful
Hi Cherry, I have been searching for how rental losses are treated from tax deduction point of view but couldn’t find a clear answer. If a landlord with one rental property incurs net rental loss, can it be deducted from the employment income? Please advise.
Generally if there's a loss, it is used to offset against other income. However, if you report multiple years of losses - it may become a red flag for CRA to audit you.
@@RealEstateTaxTips Dear Cherry, would you be willing to explore this topic in a video? I'm reading about people receiving letters from CRA asking to provide a "detailed business plan" to turn their rental property from loss to profit. Due to the repeated interest rate hikes and our rental property being on a variable rate mortgage, we are now in the unfortunate position to be losing money on our rental property. The only "business plan" we have is to wait for rate reductions, since we can't raise rent due to LTB rules. I'd love to know if there are any other strategies to mitigate losses, or suggestions you would have from an accounting POV to avoid having losses denied at CRA. Thanks!
Can you be my accountant please.
Feel free to call my office at 416-548-4228 or email us at admin@cccpa.ca