Replies to post #149630 on NorthWest Biotherapeutics Inc (NWBO)

[Extremist223]

Good afternoon Sojourner and all,

Here are some CRA Audit Rules for TFSA's.

http://business.financialpost.com/personal-finance/tfsa/heres-what-will-get-your-tfsa-audited-by-the-canada-revenue-agency

• Frequency of transactions — a history of extensive buying and selling of securities or of a quick turnover of properties

• Period of ownership — securities are usually owned only for a short period of time

• Knowledge of securities markets — the taxpayer has some knowledge of or experience in the securities markets

• Trading experience — security transactions form a part of a taxpayer’s ordinary business

• Time spent — a substantial part of the taxpayer’s time is spent studying the securities markets and investigating potential purchases

• Financing — security purchases are financed primarily on margin or by some other form of debt

• Advertising – the taxpayer has advertised or otherwise made it known that he is willing to purchase securities

• Nature of the shares – normally speculative in nature or of a non-dividend type

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For the amount of money I'm calculating to make with NWBO and given my circumstances I'm not sure if the TFSA is worth the risk of being audited.

I don't appreciate the fact that they write laws about over contribution, which incentivizes higher frequency trading, and then publish audit rules that scrutinize frequent trading.

To me, it is a trap for smart investors that would take advantage of the tax shelter.

If you look at the other rules it says basically if you did your due diligence and spent a lot of time finding a speculative investment, you have raised red flags.

So the Canadian Government is all good with you putting stocks into TFSA's, provided you didn't think about, or spend time on the investment you were making, (I.E. if you make a good call on luck -> maybe we won't audit you)

I find that to be BS if we have to sacrifice our ability write off capital losses.

Essentially they would be crucifying my account on 1 successful investment, and they are well within their right to do so, or at least it seems that way. These audit rules come from a secondhand source so if you are able to actually find those rules written in law somewhere that would be better.

I'm not sure I want to risk half of any total potential earnings just to save 10-20% capital gains tax on half of the total potential earnings.

Furthermore, my broker wants me to pay 20$ plus tax to view all the documents I signed, which have my personal ID on them (so they say). They have changed their policy since 1 week ago, while I pressured them on the phone and gained some documents, but not all.

This is all very important in my decision to switch away from a margin account and help with the vote for NWBO. Recently, it has become very clear that people on the board, including myself, are trying to get investors to vote a particular way. I don't think campaigns for either side would exist if they knew for certain which way the vote would go. I also haven't spent the time to find out whether or not with the recent debt settlement to cognate and financing of preferred shares solidifies their ability to vote successfully. Colour on that would be appreciated.

Is it a defensible position to say that I opened a TFSA to be able to vote on matters that continue operations for the company providing hope and access to a promising therapy for cancer patients?