Capital Gains Taxes are Increasing


  • Current Taxation: Right now, 50% of your capital gains are taxable.
  • New Proposal: The inclusion rate is set to jump to 66.67% for high-value gains and for all corporations and trusts.
  • Effective Date: Mark your calendar for June 25, 2024.

Canada's 2024 federal budget is bringing significant changes to capital gains taxes. Let's dive into what these changes mean for you, whether you're an individual investor or running a corporation.

What Are Capital Gains and Why Do They Matter?

When you sell an asset for more than its purchase price, you make a capital gain. Currently, you're only taxed on 50% of that gain. This means if you've made a profit, only half is considered for taxation.

The new budget plans to raise the capital gains inclusion rate from 50% to 66.67%. This adjustment affects all corporations and trusts, as well as individuals with gains over $250,000. For those with gains below this threshold, the rate stays the same.

Impact and Implementation

If you're planning to sell high-value investments or secondary properties, these changes could impact your tax bill. These are set to take effect on June 25, 2024, pending the budget's approval.

What Does This Mean for You?

Most Canadians won't feel the brunt of these changes, as they target high-value deals and corporate entities. If these changes could affect you, it might be wise to speak with a tax advisor to fully understand how your finances might be influenced.

For a deeper dive into this policy and its implications, you can read more here.