May 09, 2024

Episode 304 – Budget 2024: The Capital Gains Inclusion Rate

The Canadian government has recently proposed significant changes to how capital gains are taxed, but how will this impact Canadians? In this episode, we delve into the proposed capital gains tax changes and their impact on financial planning. We unpack the definition of capital gains tax and the complexity of the proposed changes. Explore the historical trends of capital gains tax rates in Canada, how capital gains tax works, and who will be impacted by the proposed changes. We discuss the intricacies of the alternative minimum tax (AMT), its relevance to capital gains tax, and whether the old or new AMT rules apply to the upcoming changes. Gain insights into tax considerations for long-term investment strategies, the importance of tax diversification in mitigating risk, lifetime capital gains exemption, tax planning ramifications, and more! Although this episode is Canadian-focused, it offers many useful takeaways for non-Canadians as well. To gain a comprehensive understanding of the complexities surrounding capital gains tax and strategies to navigate the proposed changes effectively, tune in now!

https://youtu.be/oawBjZGH0OI

Key Points From This Episode:

(0:00:00) Introduction and outline of today’s topic: proposed capital gains tax changes.

(0:03:07) Overview of the topic, what capital gains tax is, and the proposed changes.

(0:08:10) Historical trends in capital gains tax rates in Canada.

(0:10:59) Find out who will be impacted by the proposed changes. 

(0:14:45) Advice on how to plan for the proposed changes with an example.

(0:17:13) Model results and we unpack the nuance of AMT (alternative minimum tax).

(0:25:35) How the changes to AMT impact the proposed capital gains tax changes.

(0:32:05) Whether the new or old AMT rules apply to the proposed capital gains changes.

(0:34:27) Important tax considerations for long-term investment strategies.

(0:36:30) Insights into why tax diversification is essential to reduce the tax rate risk.

(0:39:25) Interesting budget proposals and their tax planning implications.

(0:41:17) Our perspectives on the media response to the proposed tax changes.

(0:45:40) After-show: listeners’ reviews, upcoming guests, an update on Mark’s book, and more.


Participate in our Community Discussion about this Episode:

https://community.rationalreminder.ca/t/episode-304-proposed-changes-to-capital-gains-tax-discussion-thread/29741 

Books From Today’s Episode:

The Wealthy Barberhttps://www.amazon.com/Wealthy-Barber-Updated-3rd-Commonsense/dp/0761513116

Links From Today’s Episode:

Rational Reminder on iTunes — https://itunes.apple.com/ca/podcast/the-rational-reminder-podcast/id1426530582

Rational Reminder Website — https://rationalreminder.ca/ 

Rational Reminder on Instagram — https://www.instagram.com/rationalreminder/

Rational Reminder on X — https://twitter.com/RationalRemind

Rational Reminder on YouTube — https://www.youtube.com/channel/

Rational Reminder Email — info@rationalreminder.ca

Benjamin Felix — https://www.pwlcapital.com/author/benjamin-felix/ 

Benjamin on X — https://twitter.com/benjaminwfelix

Benjamin on LinkedIn — https://www.linkedin.com/in/benjaminwfelix/

Cameron Passmore — https://www.pwlcapital.com/profile/cameron-passmore/

Cameron on X — https://twitter.com/CameronPassmore

Cameron on LinkedIn — https://www.linkedin.com/in/cameronpassmore/

Mark McGrath on LinkedIn — https://www.linkedin.com/in/markmcgrathcfp/

Mark McGrath on X — https://twitter.com/MarkMcGrathCFP

Capital Gains Calculator — https://research-tools.pwlcapital.com/research/realize-gain

Canadian Medical Association — https://www.cma.ca/

The Money Scope Podcast  — https://moneyscope.ca/

The Most Important Lessons in Investing — https://www.youtube.com/watch?v=MOjS2zuQMdo

Dan Solin — https://danielsolin.com/

Compensation Strategies for Canadian Business Owners — https://www.pwlcapital.com/compensation-strategies-for-canadian-business-owners2/

About The Author
Cameron Passmore
Cameron Passmore

Cameron Passmore has been a leading advocate for evidence-based, systemic investing for over 20 years in the Ottawa area. Today, Cameron and his team serve a broad range of affluent clients across Canada.

Benjamin Felix
Benjamin Felix

Benjamin is co-host of the Rational Reminder Podcast and the host of a popular YouTube series.

Mark McGrath
Mark McGrath

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