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To: WhatsUpWithThat who wrote (7109)	4/15/1999 8:20:00 PM
From: Rob Davis	Read Replies (2) \| Respond to of 62348

Technically you don't really lose 25% off the top. You only lose 12.5%. Consider $100 in gains. (Assume 50% tax bracket for both cases.) For capital gains, you pay 50% of $75 or $37.5. Leaves you with $62.5 dollars. If treated as income, you pay $50 which leaves you with $50. Therefore you only lose 12.5% by claiming it as income. Buckey, if you can post the link to the taxes page that you have, I'd sure appreciate it. Cheers, Rob

To: WhatsUpWithThat who wrote (7109)	4/15/1999 9:38:00 PM
From: Buckey	Respond to of 62348

Off topic but Off hours - Before I started that I was audited 3 of the last 5 years - If was to have claimed my 1997 gains from my two overnight holds they would have nailed me to the wall. I had capital gains in every year but they are minimal as most ( all ) of my long term investments are in SDRRSPs. It is in here some where rc.gc.ca and reads as copied in my letter to them: "IT479R Transactions in securities" which states ( as copied directly from the website: 11. Some of the factors to be considered in ascertaining whether the taxpayer's course of conduct indicates the carrying on of a business are as follows: (a) frequency of transactions - a history of extensive buying and selling of securities or of a quick turnover of properties, (b) period of ownership - securities are usually owned only for a short period of time, (c) knowledge of securities markets - the taxpayer has some knowledge of or experience in the securities markets, (d) security transactions form a part of a taxpayer's ordinary business, (e) time spent - a substantial part of the taxpayer's time is spent studying the securities markets and investigating potential purchases, (f) financing - security purchases are financed primarily on margin or by some other form of debt, (g) advertising - the taxpayer has advertised or otherwise made it known that he is willing to purchase securities, and PAGE 4 (h) in the case of shares, their nature - normally speculative in nature or of a non-dividend type. 12. Although none of the individual factors in 11 above may be sufficient to characterize the activities of a taxpayer as a business, the combination of a number of those factors may well be sufficient for that purpose. Further, subsection 248(1) defines the term "business" to include "an adventure or concern in the nature of trade" and the courts have held that "an adventure or concern in the nature of trade" can include an isolated transaction in shares where the "course of conduct" and "intention" clearly indicate it to be such.