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Gold/Mining/Energy : Copper Fox
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To: Metacomet who wrote (9680)10/25/2015 3:18:02 PM
From: louel2 Recommendations

Recommended By
biggerbob68
Theotokos

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Obviously you don't understand the reason for the write down. It was done by Teck themselves, not forced upon them. By taking a paper write down at this time it lowers their income on paper and provides for lower tax payable tax burden. It is just revaluation assets down to present day values.
100% of losses can be used against other out standing capital gain incomes. Perhaps derived other sales. There by lowering their overall current year tax burden. And can be carried forward if necessary.

Once those losses are wrote off, and the economy picks up again. Those same properties which were wrote down will again rise in value.
When they do the increase will have to be claimed in following tax filings as a capital gain if and when sold.

However, in Canada capital gains are taxed at a lower rate. Only 50% regular income. So 100% is wrote off, 50% taxable on the capital gain when they recover if sold in future years.
If they are not disposed of, no gains would have to be claimed. I would say it was rather a very advantageous, smooth move.

It is a prime example of what I previously suggested. Don't take everything these fear mongering talking heads write as gospel or the way it sounds at first glance. Their job depends on selling paper.

It is almost a reversal of "You Won't Believe the numbers"

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