Section 7 – Investments

Investment Income Comparison

A number of factors have to be considered when acquiring an investment, in particular the inherent risk as well as the individual’s risk tolerance. The after-tax rate of return is still often a determining factor in this regard. The following table presents a comparison of pre-tax returns on various investment categories. These calculations are based on the maximum marginal tax rate. Thus, in Quebec, an eligible dividend of 3.12% before taxes is equal to a 4% interest return before taxes, for a net tax return of about 1.9% in both cases.

2023 Pre-tax interest rate of
(%)
Provides the same after-tax return as
Capital gain Eligible dividend Other dividend
at a pre-tax rate of: (%)
Quebec 4
5
6
7
2.55
3.18
3.82
4.46
3.12
3.90
4.68
5.46
3.64
4.55
5.46
6.37
Ontario 4
5
6
7
2.54
3.17
3.81
4.44
3.06
3.83
4.60
5.36
3.56
4.45
5.34
6.22
New Brunswick 4
5
6
7
2.58
3.22
3.86
4.51
2.81
3.51
4.22
4.92
3.57
4.47
5.36
6.25

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