I would normally suggest using two separate accounts just to make things clean and you can just move her share to her account and yours to your account.

Beyond that I would just ensure you properly report the income on your tax returns.

My spouse and I invested together into some stocks in 2009, but the way we did this may not have been the smartest. The trading account is in my name and my spouse essentially gave me 50% of the purchase price of the shares. I used that money and 50% of my own money to purchase certain stocks which did very well for us. I sold the shares in 2010.

I can on the tax forms set out that each of us bought 50% of the shares (essentially by splitting the total number of shares among the two of us), but there is no formal agreement outside of an oral agreement to jointly contribute the money into the stocks and to split the profits, if any. It would be much better for us if she could show the profit as hers on 50% of the shares as the capital gains push me into the next tax bracket if fully attributed to me.

If we proceed on that basis will the CRA have a problem with this? It would be hard to prove in an audit except for showing bank transfers.

Thanks.

A person can loan funds to anyone and to ensure there is an enforceable contract, there should be interest. The lender reports the interest as income while the borrower reports the income earned on the investment as income. The loans should have at least the prescribed rate or a commercial rate of interest.

I will note that you should run the numbers. Typically, small amounts have little if any benefit. To be beneficial the loans must be long-term and the amounts substantial (several hundereds of thousands) to be worth the effort.

I have a question about investment income. In my family I have two adult daughters all living under the same roof, where one is the lowest income earner in the family. Could I, my husband, and my other daughter who earns a higher salary, lend money to the lower income daughter for investment? Who would be taxed for the income earned from this investment (of course assuming all our other incomes have been subjected to normal income tax rates)? Would it be different if the money was gifted? If you could direct me to any resources with respect to this, I would greatly appreciate it! Thanks!

Take a loot at http://blog.taxresource.ca/what-are-the-canadian-income-splitting-rules/

http://blog.taxresource.ca/tax-planning-and-income-splitting-opportunities-in-canada/

http://blog.taxresource.ca/what-are-the-canadian-income-splitting-rules/

Or please suggest other options.

Much appreciated. Thanks