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Kris Racine

7150 Hawthorne Dr. Unit 104
Windsor, ON, N8T 3N3

Phone: (519) 974-6688
Toll Free: +1 866-973-4846
Fax: (519) 974-7192

info@seguinfinancial.com

Labour Sponsored Funds

Labour sponsored venture capital corporation funds operate much like mutual funds. They are government approved corporations designed to encourage investment into private, small and medium sized businesses in Canada. Because labour funds invest in emerging, young private companies in Canada, investment growth and risk can be higher than with other equity investments.

Labour funds offer up to a 30% tax credit (15% federal plus 15% provincial) on the amount invested to a maximum investment of $5,000. Labour funds are RRSP eligible.

This chart shows the after-tax cost of investing in a labour sponsored fund outside and inside an RRSP. A 5,000 investment outside an RRSP will cost you $3,250 after taxes, but only $930 inside an RRSP if you are in the 46.40% tax bracket.

 

 

  Outside
RRSP
Inside
RRSP
Amount Invested $5,000 $5,000
RRSP tax savings
@46.40% tax rate
N/A $2,320
Tax credit @ 35% $1,750 $1,750
After-tax cost $3,250 $930

 

 

 

Mutual funds are offered through Manulife Securities Investment Services Inc. Insurance products and services are offered through Seguin Financial Group Ltd. Seguin Financial Group is a trade name used for both mutual fund & Insurance business activities. Banking products and services are offered through referral.

info@seguinfinancial.com