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Gold/Mining/Energy : TAXES, TAXATION, TAX and Canadian stocks

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To: Sans Souci who wrote (188)	7/31/2000 11:52:57 PM
From: Stock Farmer	of 548

My inexpert, misinformed, naive and untutored understanding is that there is NO WAY to withdraw capital out of an RRSP other than as earned income (e.g. you pay tax at full marginal rate). You might be able to adjust the marginal rate by clever schemes such as earning less money... but that's counter-productive. I have a very foggy recollection of a similar discussion with my accountant years ago. My takeaway was that me drawing on the capital in my RRSP and repaying loan interest was equivalent to investing my RRSP in the money market. His advice was (a) it's possible - to a limited extent, (b) it's a lot of risk and bother ("arms length" requirements), and (c) it's better to invest RRSP in equity markets which have higher expected rates of return than the money markets. In retrospect, this has certainly been true. That left the question whether or not there is an opportunity to invest my RRSP in an equity opportunity - such as me.com. Again, his advice to me was that my judgement of success was unlikely to be superior to that of the venture capital community, and that if I could convince them I have such a great idea then it makes (b) above easier too. Times may have changed somewhat since then. Equity markets are way hot right now and quite possible rate of gain may turn negative - so your question is a good one. Someone out there should know the tests a self-directed RRSP investment must satisfy? Can I buy shares in my son's lawn mowing service?

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