1. Tax rates are significantly more favourable
for dividend income than interest income. The top personal tax
rates in Ontario for 2019 are as follows:
The top personal tax rates are not expected to change for
2020.
You may want to re-evaluate your investment strategy by comparing
the pre-tax dividend rates with the pre-tax interest rates using
the chart provided in the Investment Income - A Closer
Look section at the end of this chapter.
2. You can defer tax on interest to the
following year by investing funds for a one-year term ending in the
next calendar year.
3. You can also defer purchases of mutual funds
until early in the next calendar year to minimize taxable income
allocated in the current year from the mutual fund.
