Corporate Class Client Video


When investing, it's not just about what you make; it's also about how much you keep. Taxes can take a bite out of your investment returns. How you manage the impact of taxes on your investments is part of a successful long-term financial plan.

You're probably familiar with registered plans such as RRSPs, RESPs, and now TFSAs, as popular tax deferral plans.

But what about the money that you invest outside of these plans? Investing in traditional mutual funds outside a registered plan can trigger an unwelcome tax bill.

I'd like to introduce you to Scotia Corporate Class Funds, a tax-smart solution that provides increased flexibility and more choice to manage your investments. Unlike traditional mutual funds, corporate class funds can help you grow and rebalance your non-registered investments without triggering immediate tax consequences.

As taxes are deferred, less money leaves your portfolio and more is left to grow. Another important benefit of corporate class funds is the potential for lower taxable distributions when compared to more traditional mutual funds. I'll talk about this more a bit later.

It's important to remember that Scotia Corporate Class Funds don't eliminate taxes, just defer them.

Let's take a look at how corporate class funds work.

A mutual fund can be offered in two ways: as a mutual fund trust, or as a corporation. A mutual fund trust consists of a single fund with one investment objective. A mutual fund corporation is a collection of many funds with separate investment objectives, known as classes of shares.

Another way to think of corporate class funds is like a house. In this house, a corporation has a room for each mutual fund class.

In your lifetime a lot can happen such as a marriage, promotion, or large inheritance. You may want to rebalance your portfolio to reflect your new goals and needs. Rebalancing from one corporate class fund to another is like moving your money from one room to another. Any taxes owing from the switching is deferred. So, less money leaves your portfolio and more is left to grow over the long term.

Keep in mind, you may trigger a tax consequence when you redeem your shares out of Scotia Corporate Class Funds. In other words, leave the "house".

Scotia Corporate Class funds can be a tax smart solution for:

When what you keep is as important as what you make from you investments, being smart about taxes is always a good strategy.