How mutual funds and ETFs are taxed

What you need to know about the two types of capital gains.

Matthew Elder 13 April, 2016 | 5:00PM

Most mutual funds and exchange-traded funds are structured as trusts, flowing income through to their investors. That includes realized capital gains within the portfolio. For tax purposes, the total annual amounts of the distributions -- broken down by type -- are reported on tax information slips.

Unfortunately, keeping track of all the taxes you may owe when investing in a non-registered account isn't as simple. The income reported on information slips is not to be confused with any capital gains or capital losses that you realize when you sell fund units. These gains or losses must be reported separately.

Reporting income distributions

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Matthew Elder

Matthew Elder