May 30, 2024
Hello, intrepid investors and campground aficionados! Buckle up your seatbelts, because we’re taking a wild ride through the great white north. Just when you thought it was safe to venture into the Canadian investment landscape, here comes a new plot twist that will have your financial compass spinning faster than a Mountie on a merry-go-round.
Picture this: our friendly neighbors to the north have decided that investing in Canada should come with a side of sticker shock. Yes, folks, the maple-syrup-loving, hockey-playing, ultra-polite Canadians are shaking things up with their capital gains rules. And, oh boy, are they making a splash—like a beaver doing a cannonball into a pond.
Here’s the scoop: starting June 2024, Canada is proposing to increase its capital gains rate from 50% to a whopping 67%. Ouch, indeed! If you have more than $250,000 in gains, prepare to hand over a lion's share to the taxman. Imagine selling a family property for $500,000 and watching $333,000 of it evaporate faster than ice in July.
But wait, there’s more! Donna Bordeaux, our resident tax wizard and RV enthusiast extraordinaire, has her keen eyes on these developments. She's been tracking not only the Canadian moves but also the whispers of similar changes potentially taking root in the US under President Biden in 2025. Donna's take? With numbers like these, investing in Canada might make you feel like you're playing financial Russian roulette—only with fewer chances of winning and more chances of paying through the nose.
"But hold on," you say, "isn't there a silver lining?" Well, yes, if you squint hard enough. Canadian homeowners who live in their primary residence can breathe a little easier, as they're off the hook for capital gains taxes when they sell. But heaven help you if you decide to rent it out; you'll be back in taxation nation faster than you can say "poutine."
As Donna rightly points out, such a hefty tax rate could send shivers down the spine of even the bravest investor. It’s a move that could freeze the real estate market harder than a February frost. The risk of leaving two-thirds of your profit in the hands of the government is enough to make anyone think twice, or perhaps thrice. Perhaps it’s time to consider investing south of the border?
In the meantime, keep an eye on these trends and remember that at Campground Accounting, we’re here to help you navigate these choppy waters. Whether it's exploring growth options for your campground business or pressing play on your bigger ideas, we're committed to breathing life into your investments without bogging you down in operational overwhelm or decision fatigue.
Stay tuned, stay informed, and as always, happy investing!
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Donna Bordeaux, CPA with Campground Accounting
Creativity and CPAs don’t generally go together. Most people think of CPAs as nerdy accountants who can’t talk with people. Well, it’s time to break that stereotype. Lively, friendly, and knowledgeable can be a part of your relationship with your CPA, as demonstrated by Donna and Chad Bordeaux. They have over 50 years of combined experience as entrepreneurial CPAs. They’ve owned businesses and helped business owners exceed their wildest dreams. They have been able to help businesses earn many times more profit than the average business in the same industry and are passionate about helping industries that help families build great memories.