09/26/2023
Is it possible to receive “Dividend distribution” every month from your Non-Registered Investment account Tax-Free?
The answer is “YES”! The solution is:
Fidelity Tax-Smart CashFlow™
Whether you’re trying to build savings during your working years or access those savings later in retirement, tax-smart solutions are an important part of your financial plan.
When it comes to non-registered investing, tax efficiency is half of the equation. The other half is investment quality.
What is Fidelity Tax-Smart CashFlowTM?
When you’re ready to start reaping the benefits of your investments, you’ll need to consider the tax implications around accessing your non-registered savings. Tax-Smart CashFlow can be combined with corporate class to offer even greater tax efficiency (T-Class).
How does Fidelity Tax-Smart CashFlow work?
• T-Class provides cash flow by returning an investor’s original investment principal in a return of capital (ROC). This amount is not taxable, because the investor already paid tax on it before the investment was made.
• A return of capital will reduce the adjusted cost base (ACB) of class fund shares held. Once all of an investor’s capital has been returned, the subsequent cash flows will be treated as capital gains and taxed at a lower rate than other sources of income.
• Investors can receive tax-efficient monthly cash flow without having to sell investments, meanwhile deferring capital gains.
Who can use Fidelity Tax-Smart CashFlow?
• Fidelity Tax-Smart CashFlow and T-Class offer the flexibility to develop customizable and sustainable solutions by generating tax-efficient cash flow for those in their retirement and wealth preservation years.
With Fidelity Tax-Smart CashFlow and T-Class, you can
• receive tax-efficient monthly cash flow, and customize cash-flow payout rate or amount (up to 8%) without triggering capital gains tax
• turn cash flow on or off, or adjust it according to your needs
• reinvest cash flow, shifting asset allocation over time without triggering capital gains
• transfer wealth to a charity in a tax-smart way
Still have question about Fidelity Tax-Smart CashFlow & T-Class? Please contact me to arrange for a confidential appointment and I will be happy to explain more in details to you, and help you to start saving taxes for your Retirement years!
Remember: Pay less tax = more money in your own pocket!
