Tax-loss harvesting – selling losing investments to offset tax payable on winning investments in the same year. If your losses exceed this year’s gains, losses can be carried back to offset gains realized in the previous three years, or carried forward indefinitely to reduce tax on future gains. A smart way to make your tax bill a little more reasonable and clean out your portfolio at the same time. Asset location – keeping tax-inefficient investments (interest-generating assets such as bonds and GICs) inside tax-efficient accounts (an RRSP, an RRIF or a TFSA) and vice-versa can minimize tax over time. The same goes for holding U.S. dividend-paying stocks within an RRSP rather than in a TFSA; in an RRSP, you can avoid the 15% withholding tax that would be applied on the same investment if you held it in a TFSA. Taking advantage of such preferential treatment is one of the last true tax shelters available to Canadians. Tax-efficient investments – for sophisticated investors with larger portfolios, specialized investment structures such as corporate-class mutual funds, flow-through shares, permanent life insurance and others can help offset or defer tax, or minimize the tax consequences of moving in or out of certain assets. Keep in mind that tax alpha can be a very complex, very technical topic… and a very personal one too; strategies that could work well for one person may end up being entirely wrong for you, depending on your personal financial circumstances. That’s why it’s critical to seek out qualified professional advice from an experienced accountant before enacting any of the ideas listed above. Finance Look for tax alpha Part of the difficulty in dealing with economic and political turmoil is the profound loss of control that often accompanies troubled times. It’s incredibly frustrating (demoralizing, even) to see our best-laid plans for retirement go awry because of unforeseen events halfway around the world ... yet, here we are. And that’s a pretty good argument for why you should be looking for “tax alpha.” Maybe you haven’t heard of that term before – it’s what financial professionals, accountants and tax lawyers call the extra value or added return (the “alpha”) that comes from adapting smart, long-term tax-planning and tax-minimization strategies. Unlike the “alpha” which you might generate by investing in the right stocks, for example, or by correctly predicting which direction interest rates might go in the coming months, your exposure to tax is something that remains within your control because it depends largely on the portfolio decisions and investment choices which you make. How does that work in practice? Here are some simple examples: Seek professional advice The speed with which distressing political and economic headlines have piled up over the past several months has been exceptionally difficult to deal with, for even the most experienced, most disciplined investors. But remember that you don’t have to muddle your way through it alone. One of the best ways to bulletproof your portfolio may well be to get a second opinion on it from a qualified investment professional – ideally, one who has lived and managed money through troubled times before. Working closely with a professional advisor or wealth manager can lend a welcome sense of historical perspective and objective thinking to whatever economic problems and political crises the world is going through. Perhaps more important, this can provide a starting point for formulating a personal “action plan” – a list of concrete, practical steps that will make your portfolio stronger, more resilient and ready to take on whatever comes next. CSANews | SPRING 2026 | 33
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