Capital Gains Tax Changes: Experts Weigh In
New Taxation Rules Announced in Budget 2024
In a significant move, the federal government's Budget 2024 has proposed changes to capital gains taxation, sparking discussions among financial experts and investors.
Corporations and Trusts to Pay Higher Tax
One key change is the proposed taxation of capital gains earned by corporations and trusts at the two-thirds rate. This increase aims to ensure a fairer distribution of tax revenue and address concerns about income inequality.
Boost to Lifetime Capital Gains Exemption for Business Owners
To support small businesses and entrepreneurs, the government has proposed a boost to the lifetime capital gains exemption. This exemption allows business owners to shelter a portion of their capital gains from taxation.
Implications for Commercial Real Estate
With the proposed capital gains tax increase, industry experts are questioning the attractiveness of commercial real estate investments. The changes may impact the profitability of real estate transactions and could lead to a slowdown in the sector.
Half of Capital Gains Now Taxable
Currently, only 50% of capital gains are subject to taxation. Once the changes are implemented, however, the full 50% of capital gains will be taxable, resulting in higher tax liability for investors and corporations.
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