Tax Classes : The Power to Optimize your After-Tax Return
Managing the tax impact on an investment portfolio is important. NexGen Tax Classes can enhance and facilitate the tax customization of an entire portfolio, thereby providing the opportunity for greater financial planning flexibility and greater tax efficiency.
NexGen Tax Managed Funds are designed to take advantage of tax strategies such as deferral and minimization. NexGen Funds and Tax Classes can also be switched without incurring any current tax liabilities. The full range of these tax attributes is not offered currently by any other Canadian publicly offered mutual fund.
To the Power of Four
Every one of our 4 Tax Classes was individually designed to give you the power to optimize your after-tax return. The real advantage of NexGen’s Tax Managed innovation is the power to control your tax destiny and change tax classes as your needs change.
In short, NexGen offers Tax Free Switching as no other Canadian mutual fund company can.
The Tax Classes offered by the NexGen Tax Managed Funds, excluding the NexGen Canadian Cash Tax Managed Fund, are as follows:
Capital Gains Class: Tax Efficient Annual Income
The objective of the Capital Gains Class is to provide a first preference for annual capital gains dividends. A preferential Capital Gains tax allocation is beneficial to investors for many reasons beyond the low comparative rate of taxation on capital gains.
Return of Capital Class: Tax Efficient Monthly Cash Flow
The objective of the Return of Capital Class is to provide distributions of 7.5% per annum ($0.0625/share monthly), based on a $10.00 net asset value, which are expected to be composed primarily of ‘return of capital'. Return of Capital distributions are an effective way to manage current cash flow needs and defer current taxes.
Dividend Tax Credit Class: Tax Efficient Month Cash Flow
The objective of the Dividend Tax Credit Class is to provide to the investor a monthly distribution of 6% per share ($0.05/share monthly), based on a $10.00 net asset value, which is categorized primarily as Canadian taxable dividends. There are a number of situations where this tax class can reduce taxable income.
Compound Growth Class: Tax Efficient Compound Growth
The objective of the Compound Growth Class is to maximize the after-tax value of an investor's portfolio, by minimizing the amount and frequency of distributions.
