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How are the GIC returns taxed?

The return on a Market Growth GIC is not subject to tax when the GIC is held within registered plan, as with conventional registered GICs.

If a Market Growth GIC is held as a non-registered investment, all such interest paid to the customer will be taxed as regular interest income in the year in which it is earned. A T5 is issued after maturity.

For Market Growth GICs, you will receive an annual tax receipt reflecting the interest earned during each calendar year over the term of your investment based on the Guaranteed Minimum Interest Return. After maturity of the GIC, you will receive a tax receipt reflecting the Total Interest Return, which will comprise the Guaranteed Minimum Interest Return for that year, and the Bonus Interest Return, if any.

 

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