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Gold/Mining/Energy : Day trading in Canada -- Ignore unavailable to you. Want to Upgrade?

To: JAS who wrote (1123)	11/8/1998 2:24:00 PM
From: the Chief	Read Replies (2) \| Respond to of 4467

JAS. It is either Capital Gain/Capital Loss "OR' it is income...it can't be both! If you are saying to RC that this is your "primary income, then any "gain" is INCOME not Capital Gain. Any loss is just a loss agianst income, therefore an expense, not a "Capital Loss. Purchase of any/all equipment an subscriptions can be written off against "INCOME' not against Capital Gain. Therefore if you make 100,000 after subtracting depreciation/costs and losses then you will pay 50%+ to revenue Canada...because you are in the highest tax bracket. If you had kept this a "non-business" income than the $100,000 you made would be taxed at the Capital Gain Rate which is far less than income rates. I can't stress enough, talk to an accountant before you do anything! Just another opinion! the Chief

To: JAS who wrote (1123)	11/8/1998 3:02:00 PM
From: AriKirA	Respond to of 4467

No Jim, As Chief mentioned in his post, if your daytrading activities are considered to be the source of your primary income, then any gain generated from said activity is considered as INCOME not Capital Gain. The only losses that you may deduct for your capital gain are your capital losses (refer to sections 38 and 39 of the Act). Thus, you cannot interrelate capital losses and other deductible expenses. In addition thereto, Revenue Canada only allows you to deduct certain specific expenses from your INCOME (see sections 18 and 20 of the Act). I think Chief sums it up quite well with the following phrase: Any loss is just a loss against income, therefore an expense, not a "Capital Loss'. To be honest, the Income Tax Act is one of the worst legislative enactments that I have worked with during my short legal career. Hopefully, the latter won't be that long since I intent to follow in most of your footsteps and spend my days daytrading <gggg>. I've developed quite an interest for trading and the stockmarket, in general. One of these days, I will cross the line that separates traders from investors. I get the feeling, it will be sooner than later. Hope this helps AK