Dividend Tax Credit Class
The objective of this class is to provide a fixed monthly dividend consisting primarily of taxable Canadian dividends.
Select any one of our Bond, Balanced or Equity Funds and receive a monthly distribution of eligible Canadian dividends, one of the lowest tax rate incomes available in Canada.
Dividend Distribution Rates for the
NexGen Canadian Bond, Canadian Turtle Balanced and Canadian Turtle Equity Funds
These Funds offer a distribution rate within the Dividend Tax Credit Class option of $0.40/share/year. The NexGen Canadian Bond Fund also offers $0.60/share/year rate which provides investors with more control over their monthly income on the fixed income Funds.
To view the individual distribution rates for each Fund, click here
Top Uses:
- Make any Fund a “Dividend” Fund
- Receive monthly dividend distributions on any NexGen Bond, Balanced or Equity Fund regardless of the underlying portfolio assets
- Tax Free Dividends
- Receive a maximum of up to $57,200 of Canadian eligible dividends tax free depending on your province of residency and other income
- Tax Efficient Income Sprinkling
- Corporate clients can stream dividend income to multiple family members on a tax efficient basis
Substantial amounts of annual Canadian dividend income may be received on a tax-free basis by individual investors with no other sources of income. The tax-free threshold does vary depending upon your province of residence. As a result, you should discuss the chart below with your financial advisor.
Eligible Canadian dividends provide a significant tax advantage compared to ordinary investment income. In 2011 approximately $57,200 of eligible dividends can be earned by an individual with no other source of income before any basic federal income taxes are payable. Provincial taxes can apply at lower thresholds as shown below. However, actual dividends received above approximately $49,000 can give rise to federal and provincial Alternative Minimum Tax. Consult your financial advisor.
| 2011 Tax-Free Limits for Eligible Dividends* | |||||||||
| British Columbia | Alberta | Ontario | Quebec | NFLD & Labrador | NWT | ||||
| Eligible Canadian Dividends | $57,2002 | $57,2003 | $51,9004 | $32,3005 | $57,200 | $57,2006 | |||
| * All maximums subject to changes in Canadian Legislation. Consult your financial advisor. | |||||||||
| 2 While basic federal tax starts at $57,200 provincial tax on eligible dividends does not commence until a level of $135,000 in BC. Alternative Minimum Tax can apply (At the $57,200 level it would be approximately $1,338). 3 Alternative Minimum Tax can apply (at the $57,200 level it would be approximately $1,351). |
|||||||||
| 4 For Ontario — Alternative Minimum Tax can apply (at the $51,900 level it would be approximately $280). In addition, Health Tax would appply — $750. 5 At these levels, Health Tax would appply — $741. 6 For Northwest Territories — Alternative Minimum Tax can apply (at the $51,900 level it would be approximately $1,514). |
|||||||||
| Top Marginal Tax Rates - 2011 | |||||||||
| British Columbia | Alberta | Ontario | Quebec | NFLD & Labrador | NWT | ||||
| Eligible Canadian Dividends | 23.91% | 17.72% | 28.19% | 31.85% | 20.96% | 22.33% | |||
| Ordinary Investment Income | 43.70% | 39.00% | 46.41% | 48.22% | 42.30% | 43.05% | |||
Dividend Tax Credit Class Marketing Materials
Who should select the Dividend Tax Credit Class:
- Make any NexGen Tax Managed Fund an "eligible Canadian Dividend-paying" Fund.
- Investors who wish to maximize the dividend tax credit and create tax-effective income.
- Non-working family members who have taxable portfolios.
- Non-working family members, over the age of 18, who are the participants of bona fide income-splitting strategies.
- Working family members with taxable incomes below the provincial thresholds
The initial distribution rate is based upon a net asset value per share of $10 and may be adjusted annually based upon the net asset value per share at the date of adjustment.
