In Canada, most mutual funds are set up as trusts. What that means to investors is that everything flows through to the investor. Interest, capital gains and dividends flow through and the mutual fund does not pay any of the taxes. The fund earns its "own money" on fees and would pay tax on that income. Note:Some mutual funds are set up as "corporate class", they also "flow through"
If you have further questions, or if you feel that I could be of assistance, please do not hesitate to contact me.
Mutual funds are often used as part of a retirement plan. If you would like to work with a local Retirement Planner, you could start with a Google search. For example, if you search for: retirement planner Halifax or retirement planning Halifax, my name, along with several others, will come up. You can use the same method to find Retirement Planners in your community.
That is a great question! The answer depends upon what the mutual fund is invested in. If the fund is involved in municipal bonds, (City , State or Government bonds issued to fund public projects) then you will not pay taxes on the profits that you may see. If your mutual fund is involved with stock funds, then you will pay one or more taxes. If you are paid a cash dividend, then your income taxes will be due on that payment. If the stocks increase in value, you will pay capital gains on the difference. I hope that helps. Thanks for asking!
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If you have further questions, or if you feel that I could be of assistance, please do not hesitate to contact me.
Mutual funds are often used as part of a retirement plan. If you would like to work with a local Retirement Planner, you could start with a Google search. For example, if you search for: retirement planner Halifax or retirement planning Halifax, my name, along with several others, will come up. You can use the same method to find Retirement Planners in your community.