Nicole Ewing

[music] >> Hello, I'm Greg Bonnell. Welcome to MoneyTalk Live, brought to you by TD Direct Investing.

Every day, I'll be joined by guests from across TD, many of whom you'll only see here.

We're going to take you through what's moving the markets and answer your questions about investing.

Coming up on today's show, we are going to discuss what to keep in mind as we get into the thicket of tax season. TD Wealth's Nicole Ewing joins us.

MoneyTalk's Anthony Okolie is going to have a look at a new TD Cowen report on the outlook for Canadian rail companies.

And in today's education segment, Ryan Massad will show us how you can customize the way you make a trade on the Advanced Dashboard platform.

Here's how you can get in touch with us.

Just email moneytalklive@td.com or fill out the viewer response box under the video player on WebBroker.

Before we get to all that and our guest of the day, let's get you an update on the markets.

First trading day of a shortened trading week.

I always like saying shortened trading week especially when we are heading into that Friday off. Let's start with the TSX Composite Index. Some modest green on the screen, about one third of a percent.

Among the most actively traded names are some of the energy names as the price of crude oil rising on geopolitical risk. I could've chosen any of them putting points on the top line number. Baytex is up a little more than 2%.

Also notable is Lightspeed. That stock is making moves higher today to the tune of about 5%. Interim CEO and founder Dax Dasilva just musing about the possibilities of going private, saying it something he would entertain. No news on that front but throwing that around, seems to have some interest in the name. The stock has been well off of its recent highs in recent weeks.

I want to take a look south of the border, the S&P 500 right now, a lot going on.

Down a little bit more than 1/10 of a percent. The tech heavy NASDAQ seems to be pretty much the same tune, down less than 1/10 of a percent at 13 points. I want to take a look at Lucid, and EV maker, a billion-dollar injection into that company from some of its major shareholders in Saudi Arabia has the stock moving higher.

At $2.99, it's up about 8% and that is your market update.

We are heading into the thick of tax season. Joining us now with some things you may be wanting to keep in mind for you file as Nicole Ewing, Dir., tax and estate planning at TD Wealth. Always a pleasure to have you on the show. As my pleasure.

Great to be here.

>> We still have a couple of weeks but it's a good conversation to have in a couple of weeks but not in a panic situation of the last couple of days. What do we need to keep in mind?

>> First thing, make sure you are filing on time. It sounds straightforward but a lot of things can happen and we might not prioritize it and if we are not filing on time, we are going to find ourselves facing late filing penalties, potentially having interest at 10% on overdue taxes would need to be factored into your decision of whether or not it is in your interest to be filing quickly. So make sure that you are filing on time.

Also make sure that you can defend the positions that you're taking.

And there has been a lot of discussion recently, particularly around the bare trust rules and how to file anD went to do it and at the end of the day, encourage people to think about that ultimately what you're reporting is the truth of what happened, and the evidence that you have in order to prove the position you have taken with respect to some things. When it comes your taxes, look and see, what is the position that you are taking and what evidence do you need in order to support that? Now might be the right time to go through old emails, perhaps looking at your statements, getting all of your information together so that you are in a position, should CRA question whether or not the information you have provided is accurate or complete, that you are able to support that position.

When we think about things that could be questionable, if you are claiming expenses, you need to be able to defend that and make sure that you are actually saying things, being able to prove that the position that you are taking is accurate.

>> I like that. Here's the paper trail to say this is what happened and this is how I can prove it. Also the sense to you that perhaps as things get more complicated for filing, maybe even a checklist? For example, say you're part of a company with deferred profit sharing plans or a profit sharing plan. There are forms for that, right?

>> I may have told you before about the fact that when we underreport, we are not reporting income that we have earned, there are penalties for that and if you are a repeat offender, those are doubled.

I have found myself in that situation before. I got my form this year, it's like seven dollars, but because I had underreported in previous years, I want to make sure that I'm not going to be hit with a penalty or interest for not reporting income of a few dollars. Make that list, look at what you earned or what you declared last year, what circumstances have changed and know what to expect. We should have those forms in hand by now but if you are missing anything, ask yourself why? Maybe you are not investing the same way that you were previously, maybe you are no longer part of the pension fund but you should be able to look at the documents that you were required to present in the past, see if you have them now and if you don't have them, now is the time to take action. People should have those forms in hand now from either their investors or their employers but we need to, now it's go time.

>> Exactly, get it together. When I think about filing, people might think of it as a headache but if you don't file as well, there are certain tax credits that if you are not on the books, you're not going to get those payments.

>> Is often comes up when people say I didn't earn that much or I'm below the basic personal amount or my kids earned, they had their first job. It is worthwhile filing because you are sitting there on refundable tax credits, not just nonrefundable. There are also things like assuring your accumulating room for RRSP contributions, for CPP, making sure that that is being reflected in the documentation ultimately that the government will be looking to in the future to know what your positions were with respect to certain things.

So yes, we do want to be completing the forms, doing the self reporting and filing your taxes even if you are not expecting to get a return, maybe you are thinking it's not that important. If you are not filing that return, ultimately, you are not going to be on the list for some of those other credits. So GST, for example, for lower income earners.

You are not going to receive your GST rebate if you have not filed your taxes.

So go through your list of potential income earnings that you would have had as well as the potential benefits and credits and deductions. You might be able to be utilizing some from another family member as well.

We always encourage spouses should be filing at the same time so they can take the most beneficial filing position with respect to things but also if you family members for example that you are funding their medical care, they are depending on you for your support and you are paying for some of their medical expenses, you have the opportunity to be claiming those on your taxes as well. You may want to transfer those to the lower income earning spouse because we have a 3% threshold, I think over 3% is the amount that you are able to claim, so lower the income, lower that threshold.

Some planning should be done not just for yourself but for your broader family unit, making sure that you are not missing out on some of the great incentives, credits, deductions that might be available not just for you but more broadly as a family unit.

>> My household is like, boys, I need your tuition statements from your universities, they're like, do I get some money back?

I'm like, no, I pay the tuition.

It sort of convoluted.

Looking at your situation as last year as a guide for this year, one thing that may have changed is that work from home tax credit. There are still people working from home but things have changed.

>> It's interesting to me that the way that this is really being framed and talked about because pre-COVID, there were rules in place about working from home and the expenses that you could claim.

Those are the same rules. Those have not changed. What changed is the elimination of that temporary flat tax that we were able to check a box and get your amounts back. Now we are required to prove our position. So we need that T 2200 completed by your employers saying that we were required to work from home or that we had an agreement, so it's not required necessarily but there has to be a formal agreement between you and your employer that you will be working from home and incurring expenses because of that.

Also when we are looking at how much you can claim, the timing is going to be important here. The requirement is that you are required under a formal agreement working from home at least 15% of the time for four consecutive weeks. Now that can be repeated at different times throughout the year and the amount that you are claiming for your deduction is going to be based on that period.

And there's a little bit of math involved so the CRA has very helpfully included online there guide that you can go through to look at the map, what was the space that you were occupying, how much is that space relative to the space you live in, are you using it exclusively or are using it for other purposes and you have to do the math around that. At the end of the day, we are looking at employees who are able to deduct some of their employment income because they have incurred expenses from using their personal property, using their home to fulfil their employment duties.

But the temporary measures are gone, we are now fully back into the detailed method and there are guides out there but it might be a bit trickier for folks than it was.

>> I want to ask you it is with the launch of the spot bitcoin ETFs in the US, there's a lot of spotlight back on crypto.

but there are tax considerations.

>> Yes, there are tax considerations.

When you sell or trade crypto current he, it is not a currency for the purposes of taxation but rather a commodity. When you dispose of that, that is a taxable event and you need to report that on your taxes.

The question is whether or not you are reporting it as a capital gain or you are reporting it as business income.

Depending on how you are engaging with this, with the crypto, whether or not you are engaging it with a business mind on, it could be fully taxable as business income in your hands and so that's something that people need to be aware of.

Recording how you are when you are selling, how much you are selling, how often you are engaging with it, things like are you essentially holding yourself out as a trader of the currency, that is going to define what your position needs to be with respect to it.

But absolutely, we need to pay taxes on our crypto gains. There is no hiding it.

There is excellent software there to help you track what the costs may be but at the end of the day, the tax is due.

>> Fascinating stuff as always with Nicole Ewing. We are going to get your questions about tax and estate planning for Nicole in just a moment's time.

And a reminder that you can get in touch with us any time.

Just email moneytalklive@td.com or fill out the viewer response box under the video player on WebBroker.

Right now, let's get you updated on the top stories in the world of business and take a look at how the markets are trading.

Well, there is an executive shakeup at Boeing in the wake of the 737 Max Jet crisis. CEO Dave Calhoun will step down by the end of the year, and the head of the commercial plane unit is leaving the company effective immediately. In addition, the chairman of the board is leaving in May.

In making this announcement of the executive shakeup, Boeing called the January for the incident when a door plug blew out of an Alaska Airlines plane midflight a "Watershed moment." Let's talk big tech. Coming under the microscope of antitrust regulator is in Europe this time. The European Union says it has opened an investigation into apple, Meta Platforms and Alphabet that could result in large fines. The investigations fall under the EU's Digital Markets Act which is aimed at giving consumers more choice through greater competition.

I also want to take a look at some of the chipmakers. Shares of several of them, including Intel and AMD, are in the spotlight today. This is amid reports that China wants to phase out the use of US processors in its government servers and computers. The Financial Times report also suggests China wants to replace operating systems such as Microsoft windows with Chinese made alternatives. Some of these names undermines pressure.

A quick check on the market. The TSX Composite Index has a gain of a little more than 1/4 of a percent. South of the border, modest downside for the S&P 500.

Just 10 points, about 1/5 of a percent.

Okay, we are back now with Nicole Ewing taking your questions about tax and estate planning so let's get to them. First one here for you.

With new tax rules, should I not buy a home with my senior mom as a caregiver?

>> This is an interesting question because I'm assuming we are talking about the tax rules for reporting, these T3 trust reporting rules where if you own property jointly with a parent or an adult child, you have filing obligations.

What has not changed is the tax treatment of anything.

Whether or not you need to pay tax, who pays the tax, what type of tax it is, none of that has changed but the conversation has changed significantly because a lot more people are now aware that some of this let's say DIY planning, I will add my name on this account or we can do things to make things administratively more friendly have actual tax consequences to them.

To the question of whether or not rules should impact whether or not this is the right decision for you, I think it's a factor to think about but we don't want issues. Be mindful of whether or not the underused housing tax rules apply to you.

If you're buying a home with somebody, be very clear about whether or not you are doing so as joint owners, true joint owners were you both have legal and beneficial interest in the property or whether your name is simply on title and you are going to be handling all of the affairs for them.

Whether or not they are going to be paying tax. All of those sorts of questions need to be considered so I think that the question is, is it more trouble than it's worth?

And it may be and the fact is there are these administrative issues that we need to think about but they extend beyond that. We may have creditor protection issues, family law issues, estate planning considerations so we should never have tax in and of itself be the reason that we do or do not enter into a particular planning strategy or arrangement.

>> Another audience question.

Someone wants to know what you will be watching for the Canadian budget next month?

>> Oh, gosh. Well… >> It's only four or 500 pages.

>> I'm looking for clarification, Greg. I think a lot of us really are hoping for some clear vacation about trust reporting rules.

Maybe clear vacation about alternative minimum tax.

We are hearing that there are going to be some measures for homeowners so I'm curious about what those would look like.

I've been asked whether I think the principal residence exemption is vulnerable in the situation, I don't think so.

There is, in the US, they have a max On what they are able to get under for the principal residence exemption, Max oh, I think that's 250,000 currently.

So maybe but I think that would be a very big position to be taking and we are not hearing much about that.

Interesting to see what these housing measures could be.

We have intergenerational tax measures to be able to help poor people who are changing their homes to accommodate a loved one moving in. There are other sorts of rules that already exist so we will look out for that. Clarification on the employee ownership trusts. This was again a measure that was announced 2023, I think.

What we are seeing a lot of, I will put it this way, is a sort of drip legislation where we hear that there is an announcement, there's going to be legislation and we see a draft, all sorts of issues and concerns about it, we look for some clarification, then we see amendments so we are still in that cycle of looking at what's previously been announced, are we going to get further clarifications on it? But beyond that, I don't think any of us are expecting there to be significant changes that would be impacting us from a personal-finance perspective.

>> You and I will be discussing this. I look forward to tapping your brain on that one.

We talked a little bit about the bare trust issues. Someone is getting into the details. Bare trust T3 schedule 15 update, how do we file this?

>> Very good question. To level set, the rules have changed about what needs to be filed, what trusts need to be filing a T3 return.

If you are one of these trusts that now need to file the return, you will need to get aid T3 number from the government to be able to identify yourself and there are, there is a trusted guide that you can go through. It is extensive.

The information that you need to go through, from a T3 perspective, if it is only bare trust, what is interesting is you are not reporting within the trust, you are not reporting the values of anything. It is really about the people that you need to be providing that information about. The schedule 15, this is the comprehensive document where you are required to provide much more information about the settlers of the trust, the trustees, the beneficiaries, anybody who has any sort of exertion of control to influence the decisions that are made and you will need to provide all of their details, so phone number… [laughing] >> How am I going to reach the sky?

>> All of their identifying information.

There are guides available. The CRA has put out information, more helpful in some situations than others.

It is being encouraged that people seek professional help with this and go to an accountant the challenge is that at this moment it will be hard to find an accountant that will take this on. The deadline for filing is April 2, it's a weekend. There is a waiver of the penalties and interest that would apply to late filing for bare trust's only, so if it is a trust, there is no waiver of penalties and you must still file on time.

There is a little bit of leeway, but the gross negligence penalties that we were talking about is not as big a concern at the moment.

There is an administrative position that that is very not likely going to be pursued for individuals but the forms, we clunk our way through it as best we can. I would necessarily encourage people to do this one on their own. Seek professional advice and guidance when you can get it, unfortunately, that might not be as readily available as people would like.

>> That's a big one there.

As always, make sure you do your own research before making any investment decisions.

will get back to questions for Nicole Ewing on tax and estate planning in just a moment's time.

And a reminder that you can get in touch with us any time. Just email moneytalklive@td.com.

Now, let's get our educational segment of the day.

We are having a look at TD's Advanced Dashboard, platform designed for active traders available through TD Direct Investing. Ryan Massad, Senior client education instructor with TD Direct Investing joins us now and we are going to take a look at how you can customize making trades on the platform. Walk us through it.

>> Definitely.

Advanced Dashboard is all about customization and there's nothing wrong with customizing your actual orders and how you place them so let's jump into Advanced Dashboard and check that out.

Right now I have some watchlist on her left hand here on our left with our watchlist, we can very easily place a trade by clicking on the bid or the ask.

If I were to click on the ask, it's went to open up a buy order. If I click on the bid, it will open up a sell order. The nice thing about it is you can have many of these open at the same time, if you are waiting for a particular announcement of some sort, you can get that set up.

Another way that you can be a little bit more precise in the watchlist to is if you go to these three dots, it will allow you to customize in order you're going to send, making it a little bit quicker and more efficient when you are trying to place a trade. You got your one cancels other bracket or even a conditional order.

Another interesting way to go about it as well, for those of you who are technical traders and you like to really stay on your chart, you want to… You don't want to go away from it, one of the things you can do is customize and trade from the chart itself.

You got your buttons for the bid and ask in the top left. If you click on the ask, it will open a buy ticket, just like it did on the watchlist.

But what you want to do is well is customize this for trading. Up in the top right, you got this little gear.

You can go over to the symbol itself and you can see that I want to see the previous day close price line, I want to see the high and low, I want to see the bid and ask lines, I can change the colour and that will make it easier for me to get all the information I might have gotten on watchlist before. Once I'm ready to trade, I've got this nice crosshair that can zero in on the exact area visually here and all I have to do is walk over to the +, click it and it will give me a couple of suggestions of what I might do in that particular section and it will automatically recognize where the stock is trading and again it will tell me whether or not I want to or suggest whether or not I do a buy or if I am up above the price, it will say do you want to do a buy on stop and the same goes for these sell.

It's about customizing these things for your kinds of trading and it really does help you a lot in making sure that it's the most efficient way to go about things.

>> Lots of functionality there. What about customizing the values that populate the order entry ticket?

>> Great question. You can customize the price, you can customize the duration, what kind of order pops up by default and again that can speed up the time it takes for you to do the order entry.

Let's go back into Advanced Dashboard and I will show you how to do that.

On the top right corner, you got this cute little wrench for the settings. You click on it and we are going to go straight to orders and in here, you can tell with Advanced Dashboard when I open an order, I want you to automatically go to a day order, a good till day order, good till cancelled order or day plus extended hours order.

I am asking Advanced Dashboard, please, whenever I click on it, I want you to go to a buy on the ask and sell on the bid or the opposite. I can go down here and pick the default quantity.

Maybe I don't want 1000, maybe I want 100 to be my default quantity.

You multiply this by many orders and what you are doing here is you are making yourself a much more efficient trader and that's what Advanced Dashboard is all about, customizing the look but also customizing the actions that you are taking we are placing trades to make it as efficient as possible.

>> Great stuff there, Ryan. Thanks for that.

>> My pleasure.

>> Ryan Massad, Senior client education instructor with TD Direct Investing.

And make sure to check out the learning centre in WebBroker for more educational videos, live, interactive master classes and upcoming webinars.

We are back with Nicole Ewing, taking your questions at tax and estate planning. Lots coming in so let's get to some of them.

For joint accounts, what is CRA's rule for splitting a percentage of income for account holders?

>> Okay, so, this is going to be one of these it depends answers. A joint accounts, at the end of the day, from CRA's perspective, the contributor, the person who contributed the income is the person who is responsible for the tax.

It does not matter that I have added my spouse's name to my account. I am not able to simply transfer 50% of the income to them to claim on their taxes.

Even though we are both named on the account, all of the tax needs to be paid by me.

This is what is called the attribution rules. Even if I were to have gifted my spouse that 50% interest in my account, they are still, their 50% interest will be attributed back to me. When you have income on income, the attribution rule does not apply. When it comes to the CRA's position, it will be based on who contribute in the money. Just because your name is on a 50-50 doesn't mean you can select the taxes 50-50.

The assumption between spouses is that it was a gift.

If you have an account with minor child, the rules don't apply the same way.

There is no standard rule but it depends on the case.

>> Let's get in another one.

Viewers saying, I am in the process of drawing down our RRSPs to avoid the OAS clawback later on. Does your guest have any thoughts about the do's and don'ts?

Old age security.

>> I do have a thought on this. There's a lot of talk about really maximizing your income in retirement by making sure that you are not subject to the old age security, OAS clawback.

The challenge there though is that you are ultimately taking money out now and having a tax now and you are taking it out presumably of a tax deferred account and then bring it into income and maybe you could put it into your TFSA and have it continue to be tax-sheltered or now you're dealing with that money that's in your hands and maybe it's in an account that's earning income and need to be reported.

Back to our earlier conversation, we need to step back and make sure we are not inadvertently paying more tax by trying to prevent the OAS clawback in the future.

That said, there may be an opportunity for some planning around us where we know we are having some lower income years now so we are going to draw out some of our RRSP proceeds, bring them into income, pay at the lower rate so that in retirement, we have the lower income, we are not forced to pull the money out the way we would be if it was in a riff and we can preserve our OAS entitlement.

I would encourage you to do the math, do those projections, do some what if scenarios and look at whether or not pulling that income into your hands now is really in the best interest in the short-term versus long-term. If you are taking the money out and you are not spending it on lifestyle expenses right now, try to the best of your ability to continue having it in a tax preferred account such as a TFSA. It depends on what you want to do with the money but I would suggest it not being a default of just pulling it out so you don't have to, is that it doesn't come out later.

>> Interesting stuff. Another question now. How does the CRA decide if you qualify as a trader rather than a passive investor?

>> Good question!

The question is, is this business income?

Am I generating business income as opposed to other types of income?

And then the CRA does have a, rules of thumb, some tests that they will look at.

This is available online.

They have some good information documents where they live this out but ultimately we are looking at how frequently you are trading, the nature of your trades, what you are in the business of trading, are you advertising yourself as a trader? It is not necessarily that you are doing it, the number of trades that you are doing.

>> There is no threshold.

>> There is no threshold. It can be one biggie. It all comes back to intentions.

If your intention was to engage with it as a business, to see profit as opposed to informal gains that we would expect from investing, that's where the CRA will have an opinion on it. It is a test of your actions, your behaviour, how you are engaging with it. There are some more details for those interested, there's an information circular.

>> I would be blown away if you could pull that number straight out of your head like that.

>> It's a frequent question and it's ultimately one where we are looking at a number of factors, the totality of that situation but if you are suspecting that… If you have to ask… Yeah.

>> Another question from the audience.

Someone wants to know if a gain is CG or income, does it not depend on the election one does in the first year election which stays permanently?

>> It's so interesting!

Again, this is a question about intent. So capital gain versus business income.

Those are really the two that we are grappling with because capital gains, you're paying 50%.

The inclusion rate is 50%, versus business income, which is 100%. It's a big deal.

But it's not simply an election that you are making with respect to the particular asset. If it was a home, for example, it may be that it is your principal residence for a certain period of time and then there was a change of use where it was no longer principal residence and so for those taxpayers would be taxed differently. It's a bit of a moving target.

You can't simply stated to be so and have CRA bound by what you have declared.

Ultimately, it will be a question of evidence, it will be a question of your intent and how you have engaged with it and there might be a change in your circumstances at some point where you have shifted from something being more passive capital gain to now you are in the business of trading.

>> That was an impressive lightning round.

You took in a lot of questions in a short period of time. We will get back to more questions were Nicole Ewing on tax and estate planning in just a moment's time.

As always, make sure you do your own research before making any personal finance decisions.

And a reminder that you can get in touch with us at any time.

Do you have a question about investing or what's driving the markets?

Our guests are eager to hear what's on your mind, so send us your questions.

There are two ways you can get in touch with us.

You can send us an email anytime at moneytalklive@td.com or you can use the question box right below the screen here on WebBroker. Just write in your question and hit send.

We'll see if one of our guests can get you the answer right here at MoneyTalk Live.

Let's talk about the railways. Those stocks have performed well all year today, the relatively high valuations applying considerable optimism heading into the second quarter of this year. But with interest rates still sitting at €22 in economic growth expected to slow, are these expectations too rosy? Answer equally joins us now with TD Cowen's outlook for the Canadian Railroad sector.

>> TD Cowen says that group evaluations remain at historically high levels in the first quarter of this year. They also note that carload volumes were up 1% year-over-year in the first quarter of 2020 for which they believe is slightly better than expected at the start of the year but not by a wide enough margin to meaningfully improve visibility into the second half volume recovery driving consensus estimates and management guidance.

TD Cowen does note that intermodal, this basically involves two or more forms of transportation of goods during a single journey, it can be by train and by truck, intermodal is by far the major driver of growth year to date as it was in 2023 and 2022, partly due to easy prior year comparisons. Volumes are up year to date by about 6% with stronger international versus domestic transport. Domestic transport is still being impacted over excess over the road capacity.

The expiry of dockworkers contracts on the US east gulf coast.

. . That should benefit Western Canadian ports as the LA, Long Beach sports are prone to congestion and it is reportedly already dealing with container backlog. Meanwhile, carload volumes are flat year to date by total carload, that excludes intermodal, are down 4% year to date with strength in chemicals and petroleum products offset by weakness in coal, crushed sand as well and as gravel and grain. We have about two weeks of carload volumes were left to report in March and it appears that the current bias towards Q1, 2024 consensus estimate is flat to down slightly.

Finally, valuations as I mentioned remain elevated.

Real stocks are flat up to 16% year today.

That raised the group's average price… And that is higher versus the five-year and the 10 year ranges.

TD Cowen believes that an early peak season could result in better-than-expected second-quarter earnings and sustain the group's recent share price momentum. Ultimately, TD Cowen believes that the 2024, 2025 and further years earnings-per-share estimates need to catch up.

>> Interesting stuff.

What about some risks?

>> They highlight a couple in the report.

One is lower-than-expected economic growth. That could further dampen rail volumes going forward. Also if inflationary pressures persist, we could see rapid increase in fuel prices and other costs which could impact margins for the railroads.

Other risks include competition, unfavourable regulatory developments, environmental remediation, labour disruption and/or harsh weather.

>> Thanks, Anthony.

>> My pleasure.

>> MoneyTalk's Anthony Okolie.

Now, for an update on the markets.

We are back into Advanced Dashboard, taking a look at the heat map function, giving us a view of the market movers.

This is the TSX 60 and we are screaming by price and volume.

We have the price of crude from her today on geopolitical risk. It names like Suncor, Cenovus to the upside of more than 2%. CNQ liking a little bit but up almost 2%. A modest bid into some of the mining stocks. That's where the action is on Bay Street. Let's check out Wall Street now, the S&P 100.

You can get more information on TD Advanced Dashboard by visiting ke.com/Advanced Dashboard.

We are back with Nicole Ewing from TD Wealth. Lots of questions. Let's look at another one.

It is a recreational property co-owned with your adult children a bare trust under the CRA rules?

>> It could be, yes.

This is where it comes down to intention and what the individual's rights are with respect to the property.

But ultimately, the question is whether or not the legal owner of the property, so the person whose name is on the deed, is that different than the people who have a right to and beneficial interest in the property? And if so, you may have what's called a bare trust. When we think about her parents are owning a home together with their adult children, likely done for convenience purposes for probate or to deal with us administratively, if the children's name are on that property, but are not true beneficial owners, meaning when the parents bought the home, did they, did the children contribute to it?

If not, then their name on their means they are simply beneficial owners.

Entitle. Pardon me, legal owners.

If the parents own the property and subsequently added their children's name to the property, at the time that the children's names were added, did they declare to CRA that there was a deemed disposition of a percentage of the interest in the property? That would suggest that the children came on as true legal and beneficial owners and that taxes could be dealt with otherwise. But if the parents owned this property and fully contribute in their own money to it and simply added their children's name to this property at a later date, and the children did not contribute but the parents did not declare that there had been a disposition of an interest in the property, then the children's names being on that property likely mean that they are holding it in trust for the estate, for the parents and therefore, depending on the circumstances, the children could be trustees and have that filing requirement. Now they would've had the unused housing tax requirement to file as well but and the T3 here as well.

So yes, owning property with adult children could potentially imply filing requirements. did I say potentially enough times?

>> We are going to squeeze in one more.

I put my child as a beneficiary on my wrist. When I die, will the tax payable on the roof withdrawal be paid by my estate or by my child?

>> Those assets flew out of the estate of the proceeds go directly to the beneficiary.

The tax due on the riff is still owed by the estate.

If the estate has other assets, liquidity, in order to pay that tax, they will. If, however, you have named your child as beneficiary and there are no other assets of the estate, your child may receive the full totality of the money pretax and CRA can come after them to pay the tax themselves.

So tax will be paid by somebody at some point. Naming a beneficiary does not change, naming a child is a beneficiary does not change your tax outcome. The estate owes the tax. If it does not have the money to pay for it, they will go after the beneficiary.

>> It's always a pleasure to have you.

>> My pleasure.

>> Thanks to Nicole Ewing, director of tax and estate planning at TD Wealth.

As always, make sure you do your own research before making any investment decisions.

if we don't have time to get your questions today, we are going to try to get them into a future episode of MoneyTalk Live.

Stay tuned. Will you back tomorrow with Ben Gossack, Managing Director and portfolio manager at TD Asset Management.

He will take your questions about global stocks.

A reminder of course that you can get a head start with your questions by emailing moneytalklive@td.com.

That's all the time after the show today.

Thanks for watching. We will see you tomorrow.

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