Non-registered accounts and taxation basics
What you'll be able to do
In taxable accounts, income type drives tax: interest worst, capital gains best — locate assets accordingly and refer specifics to a tax pro.
- Non-registered = taxable; the tax depends on income type.
- Interest is taxed as ordinary income; eligible dividends get a credit; capital gains are partially included.
- Asset location: shelter the least tax-efficient income inside registered accounts.
Once registered room is used up (or for goals that don't fit a registered plan), clients invest in non-registered (taxable) accounts. Here, how income is taxed depends on its type. In Canada, interest is taxed as ordinary income (least favourable), eligible dividends from Canadian companies get a dividend tax credit, and only a portion of capital gains is included in income — making capital gains generally the most tax-efficient.
This shapes 'asset location': it can make sense to hold interest-heavy investments inside registered accounts (where the tax is sheltered) and more tax-efficient holdings in taxable accounts. You don't need to be a tax expert, but you must know enough to avoid steering a client into an obviously tax-inefficient setup — and to know when to refer them to a tax professional.
The seller's discipline here is humility: give general guidance, flag the tax consequences of a recommendation, and refer specifics to an accountant. Saying 'here's the general idea, but confirm the numbers with a tax professional' protects both the client and you.
Key points
- Non-registered = taxable; the tax depends on income type.
- Interest is taxed as ordinary income; eligible dividends get a credit; capital gains are partially included.
- Asset location: shelter the least tax-efficient income inside registered accounts.
- Flag tax effects, give general guidance, and refer specifics to a tax pro.
Examples
A client holding a bond fund (interest income) in a taxable account and equities in their RRSP may be tax-inefficient — flipping the location can reduce the annual tax drag.
Pitfalls
- Giving specific tax advice you're not qualified or licensed to give.
- Ignoring that a 'great' taxable investment can be eroded by an unfavourable tax treatment.
Ask your sales coach
In a real Adept rollout this routes to your firm's compliance-approved Claude project; in the demo it opens a fresh Claude chat. Never share real client details.