Milestone is uniquely positioned to help reduce and defer tax on investment income and enhance what really matters – your personal returns after tax.
In our industry, investment performance is generally reported without regard to the tax liability that accrues to individual investors each year. As investment counsellors who know your financial situation, we’re able to recommend and help you implement a broad range of strategies to maximize your after-tax wealth.
Your comprehensive investment plan reflects your goals, marginal tax rates, time horizon, family situation and income (both current and future). We also incorporate the tax treatment of each asset class, our projected returns for each class and an estimate of portfolio turnover. From here, we allocate assets among your taxable and tax-sheltered accounts to create the most tax-efficient portfolio for you.
Among the more personalized tax strategies available to Milestone clients:
Registered plans such as RRSPs are used not only to shelter highest-taxed assets but also as the “rebalancing” account to restore your portfolio to its optimal asset mix without triggering tax.
For taxable accounts, we maintain an equity bias, buy discount bonds and promote low portfolio turnover to minimize and postpone taxes as long as possible (the “least and latest” principle). Every potential “sell” decision is evaluated on its tax effect as well as its investment merits.
Throughout the year, we examine your portfolio for opportunities to benefit from capital losses due to market volatility, while maintaining the portfolio’s optimal structure.
For couples and families, we examine various income-splitting techniques, such as spousal loans and joint accounts as well as RESPs for a child’s education, an RDSP for a family member with a disability, and lastly TFSAs and FHSAs for any family member 18 or older.
Our tax-sensitive style demands a level of investment flexibility not possible with the pooled products typically offered by many financial institutions and investment managers. It’s one more way we deliver excellent value and bottom-line results to our clients.