Download Corporate Class: Tax-efficient Investing

Corporate Class:
Tax-efficient Investing
Canoe Corporate Class Funds offer the potential for growth and income,
combined with enhanced tax efficiencies
Tax-efficient income: There are different ways you can earn
income on an investment: through interest income, dividends,
capital gains, and return of capital. Each type of income is taxed
differently. Corporate Class dividends are in the form of capital
gains or dividend income – currently the most tax-efficient
sources of income.
Benefits of Canoe Corporate Class Funds
Tax-efficient growth: Working with your financial advisor or
tax professional, you can take advantage of the opportunity to
use capital losses in some Corporate Class mutual funds to
offset gains in other Corporate Class funds.
Tax-efficient cash flow: Canoe Series T6 funds offer investors
the ability to access tax-efficient cash flow from Canoe
Corporate Class funds as it is treated as return of capital.
Tax-efficient Growth of $10,000 Invested**
$40,000
Corporate Class Investment
Dividend-paying Investment
Interest-paying Investment
Why is tax-efficiency important?
$31,985
$30,000
$26,295
$21,042
$20,000
Of the three potential investment impacts –
taxes, management expense ratios (MERs)
and inflation – taxes represent the biggest
impediment to wealth accumulation.*
This chart demonstrates the benefits of an
investment taxed at a corporate tax rate versus
an investment taxed at a dividend tax rate or
interest tax rate.
$10,000
1
3
5
7
9
11 13 15 17 19 21 23 25
Years
*Source: The Canadian Securities Institute.
**Assumptions: For all scenarios, we have assumed a pre-tax rate of return of 6.5% and all income reinvested. For the corporate class scenario, we have assumed a
reinvested annual capital gains dividend of 5%, taxed at an effective rate of 26.8%. The dividend-paying scenario assumes eligible dividends are received and taxed annually
at 39.3%. The interest-paying scenario assumes interest is taxed annually at 53.5%. Taxable dividends may also be paid to investors. We have assumed 2016 Ontario
provincial tax rates for the purpose of this document. The tax rate applicable to an investor will vary based on the provincial tax rate applicable to them.
Page 1 of
For illustrative purposes only.
2
Corporate Class:
Tax-efficient Investing
Series F
Series T6
Series T6
L/L
Series F6
GOC702
GOC703
-
-
-
GOC1201
GOC1202
GOC1203
-
-
-
Canoe Enhanced Income Class
GOC901
GOC902
GOC903
-
-
-
Canoe Strategic High Yield Class
GOC5001
GOC5002
GOC5003
-
-
-
Canoe Canadian Monthly Income Class
GOC201
GOC202
GOC203
GOC204
GOC205
GOC2036
Canoe North American Monthly Income Class
GOC6001
GOC6002
GOC6003
-
-
Canoe Canadian Asset Allocation Class
GOC301
GOC302
GOC303
GOC304
GOC305
GOC 3036
Canoe Equity Income Class
GOC1001
GOC1002
GOC1003
-
-
-
Canoe U.S. Equity Income Class
GOC1101
GOC1102
GOC1103
-
-
-
Canoe U.S. Equity Income Class –
GOC11111
GOC11112
GOC11113
-
-
-
Canoe Global Equity Income Class
GOC9001
GOC9002
GOC9003
-
-
-
Canoe Equity Class
GOC401
GOC402
GOC403
GOC404
GOC405
GOC4036
Canoe Global Opportunities Class
GOC8001
GOC8002
GOC8003
-
-
-
Canoe Energy Income Class
GOC2001
GOC2002
GOC2003
-
-
-
Canoe Energy Class
GOC501
GOC502
GOC503
-
-
-
Fund
Series A
Canoe Bond Advantage Class
GOC701
Canoe Global Income Class
USD Purchase option
Series A
L/L
In the 2016 Budget, effective January 2017 the tax-deferred switching of shares of one mutual fund for shares of another mutual fund
where both mutual funds are part of the same mutual fund corporation (corporate class structure), has been eliminated. However,
switches between series of the same mutual fund are still allowed on a tax-deferred basis. Note: this change will have no impact when
corporate class funds are held in a registered plan.
The information contained in this report is designed to provide you with general information related to investment alternatives and
strategies available as of the date indicated and is not intended to be comprehensive investment advice applicable to the circumstances
of the individual and should not be considered as personal investment advice or an offer or solicitation to buy or sell securities. This
should not be construed to be tax advice, as each client’s situation is different. Please consult your own tax advisor. This document may
contain forward-looking statements which involve known and unknown risks, uncertainties and other factors that may cause actual
results or events to differ materially from those anticipated, and should not be unduly relied upon. Canoe does not undertak e any
obligation to publicly update or revise any forward-looking statements. Market conditions may change and the manager accepts no
responsibility for individual investment decisions arising from the use or reliance on the information contained herein. We recommend
you to consult with a financial advisor prior to making any investment decisions. Commissions, trailing commissions, management fees
and expenses all may be associated with mutual fund investments. Please read the Simplified Prospectus before investing. Mutual funds
are not guaranteed, their values change frequently and past performance may not be repeated.
Page 2 of 2