You get a 100 percent tax deduction in the first year. Is there money to be made or is like buying that big Deere combine for half a million?
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Prospectus not completed yet.
http://www.benzinga.com/pressreleases/m85451/sprott-2010-flow-through-limited-partnership-announces-initial-public-offering -
Best investment in flow throughs are with the guys that have skin in the game. Not just looking for more money but are in the game because they are wanting to get ahead.Comment
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Bought lots over the years. About 5-6 years ago returns were north of 60-80% (when looking at money at risk after tax savings) but recently, the decline of oil and the economy, many lost big bucks, including myself.
For now I am sitting tight but in a year or so, will probably invest again.
Canadian Dominion resources seems to be the most consistent. Enervest is another company that returns were acceptable.
Would never buy inside a corporation as dealing with the tax treatment is tricky. Much easier on a personal return. If you control your own corporation, you can set your personal income to make the flow through offset your higher personal tax rates.Comment
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I would think with common sense one should have higher caution with Sprott 2010 corp offering shares as a limited partnership. No doubt Sprott 2010 would likely receive 5 percent of the partnership just for the expense of selling the shares and to pay for creating the corp, just a guess.
Then Sprott asset management would be hired for likely 3 percent per year to manage the investments into various explorations. Mutual funds never show you their specific investments and what the managers rake off the top they only show you a ball park figure which allows the managers to steal what they want. And considering the timeline it is a high pressure sale. Without a prospectus, they don't want you to think too much. Like you said Sask99 unless your in a high tax bracket say over 60 percent the flow through is not for you. Sask99 if something ever comes up that you are interested in let me know.Comment
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Well, the first thing is that even with tax integration of eligible dividends, no canadian taxpayer will pay more than 45% on any earnings.
If you are looking for a well run flow through Canadian Dominion Resources has done well (except for 2006 & 2007, but everyone lost those years)
In a perfect world, you buy your shares at $25 and you sell them for at least 75% of that. With the highest tax bracket of 44% your cost of a $10,000 investment would be $5600. At 75% you would have a small return.
Right now, estimated values of outstanding shares are $21.62 for 2008 and a premium for 2009 with $26.79. My guess is that 2008 is going to finish with about a 3-5% return - Safe, at least not a loss.
http://www.canadadominion.com/s/InvestmentPortfolios.aspComment
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