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Canadian Securities Course (CSC) Practice Exam · Question

Which type of investment income is generally taxed as capital gains in Canada?

Capital gains arise when an investment, such as a stock, is sold for a price higher than its adjusted cost base. Only 50% of capital gains are taxable in Canada

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Question: Which type of investment income is generally taxed as capital gains in Canada?

Answer options: ✅ Profit from selling a stock for more than its purchase price

  • Interest earned from a corporate bond
  • Dividends received from Canadian corporations
  • Income from a mutual fund distribution that includes interest

Correct answer: Profit from selling a stock for more than its purchase price

Explanation: Capital gains arise when an investment, such as a stock, is sold for a price higher than its adjusted cost base. Only 50% of capital gains are taxable in Canada.

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