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www.oakvillebeaver.com The Oakville Beaver, Wednesday September 13, 2006 - 25 26th annual Terry Fox Run for cancer research on Sunday Walk, bicycle, rollerblade, run or push a stroller in this Sunday's 26th annual Terry Fox Run. Oakville residents are invited to honour the late Terry Fox and raise money for cancer research. Fox lost his right leg to osteogenic sarcoma, bone cancer, in 1977. While in hospital recovering from his leg amputation he was so overcome by the suffering of other cancer patients, particularly children, that he decided to run across Canada and raise $1 from every Canadian, $24 million, in his Marathon of Hope. He ran a marathon, an average of 42 kilometers ­ 26 miles ­ a day for 143 days in 1980 before being forced to abandon his run when the cancer returned and spread into his lungs. That year, the first Terry Fox Run was held to symbolically complete his run. Fox died in June 1981. Over the past quarter century, the Terry Fox Run has raised more than $400 million worldwide under the auspices of the Terry Fox Foundation headed by the late runner's younger brother Darrell Fox. This year's Terry Fox Run will start and finish at Abbey Park Secondary School, next to the Glen Abbey Recreation Centre on Third Line south of Upper Middle Road. The run begins at 10 a.m. Registration starts 9 a.m. Participants can choose to run, walk, bicycle, or rollerblade either a 5K or 10K route along Pilgrim's Way and Nottinghill Gate in Glen Abbey. Participants will warm up with Blast Sport and Fitness, and the runners will start to the sound of Elizabeth Sheridan's bagpipes. The opening ceremonies, featuring Dorothy and Daisy Progosh leading in the singing of O Canada, starts at 9 a.m. Master of ceremonies will be Jim Paulson of AM740. Before and after the run, entertainment will be provided by a talented Oakville band, The Superficials. Also watch for Jeannie Jelly Beans and The Amazing Aidan walking through the crowd as well as a children's craft area with face painting. Glen and Lystra Hamilton will perform their original song Run Terry Run, written in 1980 during the Marathon of Hope. The Kinsmen will be selling `ham and eggs on a muffin' from 8:30 a.m. - noon. A limited number of Terry Fox T-shirts will be for sale at a cost of $15 for adults and $10 for children (size 6X). Pledge sheets are available at all Town recreation centres and various businesses throughout Oakville. Registrations can also be made on site on Sunday. There is still time to register a team for Oakville's First Annual Corporate Team Challenge. While new to Oakville this year, the Corporate Team Challenge has been a part of the Terry Fox Run for many years. Last year, Corporate Challenge Teams raised over $1.6 million across Canada. Families can also get involved as a team and challenge other families to raise funds. Register online at www.terryfoxrun.org or contact Keri Schoonderwoerd at 905-469-0828. For information call Ralph Robinson at 905-827-7659. Mississauga-Oakville Bridge Centre Fall And The American Contract Bridge League Bridge Monday evenings 7:45, beginning September 18 FOR BEGINNERS...8 weeks, $139.00 beginning September Lessons Wednesday afternoons 1:30,weeks, $139.00 20 FOR "RUSTY" PLAYERS...8 th th Oil and Gas Tax-Preferred Investments It All Flows Through Five key risks to manage for successful retirement income planning. The concept of a flow-through share can be difficult to understand. To promote the development of oil and gas and other natural resources, the government of Canada allows Canadian natural resource companies to fully deduct specific exploration expenses, known as Canadian Exploration Expense (CEE). Many of these companies issue flow-through shares to raise capital, and in turn renounce CEE to shareholders. Investors can buy units in a partnership that in turn buys shares in the companies, party to an agreement for this CEE sale. Some flow-through structures include shares in privately held production and exploration firms not available on the market. The tax credits are realized by the unitholder, writing off up to 100 per cent of the total in the original year of investment, and in some cases, additional benefits can be available in the second and following years. Once these up-front tax benefits are exhausted, one option is to roll the holdings in the limited partnership into a mutual fund, with no immediate tax consequences to the investor. Since the investor enjoyed a full tax deduction over the two-year hold period, the units of the mutual fund carry an adjusted cost base of $0. If these mutual funds are sold, the investor would face capital gains on the entire balance, because of that $0 cost base. At current marginal tax rates, Ontario-based investors will likely pay approximately $0.23 on the dollar. There are many ways of using flow-through investments in your portfolio. The chief benefits are tax deferral and the ability to turn income from any source ­ personal or business ­ into capital gains, which are taxed at a much lower rate than earned or interest income. Tim Trian, CFA - Portfolio Manager Laura Trian, C.A., CFP CIM - Investment Advisor , Monday mornings 9:45, beginning September 18th Wednesday evenings 7:45, beginning September 20th THE BRIDGE CENTRE OFFERS GAMES & LESSONS FOR PLAYERS OF ALL SKILL LEVELS (See our website) 200-2908 South Sheridan Way, Oakville Tel: 905-829-0600 Visit us at http://teamtrian.dundeewealth.com Please call (905) 820-5728 www.raynerbridge.com REGISTRATION--540 GOLDEN HAWKS AIR CADETS of Oakville will be holding a registration evening on Tuesday, September 19 from 6:45pm to 9:30pm at Blakelock High School. Call for a free mortgage consultation. Mortgage solutions for all borrowers. Anthony Spadafora ­ Mortgage Specialist Direct ­ 416-895-8610 Office ­ 905-828-1122 5 year 7 year 5.44% 5.55% anthony@assuredmortgage.ca www. 6509-C Mississauga Road, Mississauga, ON L5N 1A6 Rates are based upon approved credit and can change without notification. Peace of Mind ... ... the most Valuable Service we Provide Air Cadets is open to all teens 12 to 18. If you are interested in any of the following activities, give us a try! Flying/Scholarships Summer Camps Leadership Training Survival Training Model Building Community Service Trips Band Instruction Here are four examples of how flowthrough investments can be used to benefit investors: EXAMPLE 1: Putting capital losses to use. Anton Tucker CFP, FMA, FCSI 905.330.7448 anton@tridelta.ca www.tridelta.ca OAKVILLE NORTH YORK MISSISSAUGA THORNHILL The Air Cadet Program is FREE and uniforms are provided. We meet every Tuesday from 6:45pm to 9:30pm at Blakelock High School. For more information please call 905-842-3232. Living Healthy A series of FREE public education seminars presented by Inflammatory Bowel Disease In Children and Teens A Better Quality of Life An investment in a flow-through limited partnership turns current income into future capital gains, which can be used to offset any caputal losses realized and or unrealized. It's a way to put any capital losses you may have to use by offsetting those capital gains incurred on the flow-through investment. Here's a simple example. Consider an investor who puts $100,000 into an equity that subsequently lost 75 per cent of its value. that holding is worth $25,000, and the capital loss is $75,000. A $100,000 investment in a flowthrough limited partnership reduces income in that first year (see example). 2), providing an immediate tax saving (assuming they have taxable income greater than $100,000). After two years, the flow-through investment will likely mature into a mutual fund, which can be sold. At that point, the ACB is zero, and the mutual fund holdings could be worth more or less than $100,000, depending on the performance of the partnership holdings. For simplicity, let's assume it's still worth $100,000. The sale of those funds will result in a capital gain of $100,000, of which $75,000 can be offset by using the carried forward capital loss. That results in a net capital gain of $25,000, a taxable capital gain of about $12,500 and tax payable of about $5,800 (using a typical marginal tax rate of 46.4%). Adding it all up, the $100,000 flow-through investment has resulted in an investment worth $100,000, first-year tax savings of $46,400 and a tax bill of about $5,800. OAS payments are clawed back, for example. In this situation, some people opt to withdraw or de-register a portion of their registered accounts to collapse the size of the account and avoid future income. This means they have to take the amount withdrawn into income in that year and pay the required amount of income tax. If the investor were to take these funds and purchase shares in a flow-through investment, they would enjoy the tax deduction and hence turn this withdrawn and realized income into capital gains. Another similar scenario may occur for investors who already take income from a Registered Retirement Income Fund or annuity. If the income is not needed to preserve a lifestyle or provide life essentials, again the income can be invested in flow-through products to offset the taxes. EXAMPLE 4: As a cash-on-cash generatin machine. The power of flow-through investing can be compounded to generate freeflowing cash for years from a simple investment made over a two-year period. Many investors follow a simple plan of liquidating the mutual fund securities held after the partnership is closed and investing those proceeds in another limited partnership. there will be capital gains taxes to be paid, but there should also be a very attractive after-tax return available for reinvestment, and further benefits. These are but a few tax and investment management strategies made possible by using flow-through shares. There are a number of risks associated with these investments and of course it goes without saying that the informed investor will always review and read carefully the information contained in the offering memorandum or prospectus of any flow through offering before investing. Potential investors are also advised to consult their tax advisors before investing. For more information on flow-through investing please feel free to contact Tim Trian, CFA Portfolio Manager, Dundee Securities Corporation, Member CIPF at 905-829-0600. This article was prepared by Tim Trian who is a Portfoilo Manager with Dundee Securities Corporation, a Dundee Wealth Management company. This is not an official publication of Dundee Securities and the veiws (including any recommendations) expressed in this article are those of the author alone, and they have not been approved by and are not necessary those of Dundee Securities Corporation. EXAMPLE 2: Lower taxes for high-income earners. An individual in the highest tax brackets will enjoy the benefits of an investment in flow-through shares as the deductions created on any income source effectively turns earned income into capital gains. Only 50 per cent of capital gains are taxed, so an investment using after-tax dollars allows the investor a chance to write off 100 per cent of the amount of the investment over two years and "get back" half. Consider a case of an investor earning $200,000, who receives the income in four equal quarterly payments of $50,000. These payments require a matching tax installment payment of $23,200. If the individual were to purchase $50,000 in flow-through shares, they would be entitled to write off the entire amount, effectively wiping out the taxes due. That is an extreme example, but any amount purchased will offset some degree of the taxes payable. Members of professional partnerships who may be forced to include previously realized and deferred income may be interested in the income offsetting tax deduction. This situation would also apply to retirees, who receive income from pensions, annuities and registered accounts where an income stream has already been realized. Tuesday, September 19, 2006 6:30 pm Displays and Refreshments 7:00 pm Presentation by: Dr. R. Issenman, Paediatric Gastroenterologist, MacMaster Children's Hospital, Hamilton Oakville-Trafalgar Memorial Hospital, Auditorium 327 Reynolds Street, Oakville L6J 3L7 RESERVE YOUR SEAT TODAY: 905-338-4379 Presented in partnership with: Supported by an educational grant from: Column Provided by EXAMPLE 3: Control the taxes on income from registered accounts. Investors who have a very large registered plan may look for methods to reduce their income prior to retirement. One practical consideration is that these investors may want to ensure that their income stays below a level at which Crohns and Colitis Foundation of Canada The opinions expressed in this column are those of the author and do not necessarily represent the views of this newspaper.