DEFINITION of 'Attribution Rules'

A set of rules created by Canada Revenue Agency (CRA) that prevents investors from transferring assets between family members with the intention of avoiding taxes.

BREAKING DOWN 'Attribution Rules'

The goal of these rules is to prevent individuals in higher tax brackets from transferring assets to family members who are taxed at lower marginal rates in an attempt to evade being taxed at their own high rate. These rules were implemented to close a loophole in the Canadian tax system.

  1. Canada Revenue Agency - CRA

    A federal agency that collects taxes and administers tax laws ...
  2. Income Splitting

    A tax reduction strategy employed by families living in areas ...
  3. Community Reinvestment Act - CRA

    An act of Congress enacted in 1977 with the intention of encouraging ...
  4. Uniform Transfer Tax

    A combination of federal estate taxes and federal gift taxes. ...
  5. Income Shifting

    Income shifting reduces overall tax liability by transferring ...
  6. Tax Rate

    A tax rate is the percentage at which an individual or corporation ...
Related Articles
  1. Taxes

    Do Canadians Really Pay More Taxes Than Americans?

    We look at the difference in tax rates and services offered on both sides of the border.
  2. Taxes

    How To File A Canadian Tax Return

    The process for filing a Canadian tax return is easy and streamlined. Here is the information you need to know before filing.
  3. Managing Wealth

    Establishing Rules for Family Wealth

    To maintain family wealth it is important to establish rules that everyone agrees on.
  4. Financial Advisor

    Ready for the Fiduciary Rule? You Should Be

    Despite the opposition it faces, advisors should still plan to comply with the fiduciary rule. Here's why.
  5. Taxes

    7 Ways to Create a Tax-Efficient Portfolio

    Taxes may be a necessary evil, but that doesn't mean they can't be reduced. Here's a host of smart moves today's investors can make.
  6. Personal Finance

    3 Common Tax Questions Answered

    We clarify some rules that often puzzle taxpayers.
  7. Managing Wealth

    How to Set Up a Trust Fund in Canada

    You don't have to be rich to make use of a trust fund. Rules can be complex. Here's what you'll need to discuss with your lawyer.
  8. Taxes

    4 Ways To Minimize Estate Taxes

    These four strategies will ensure that most of your money goes to your loved ones, and not to the government.
  9. Investing

    What Happens to Hedge Funds if Trump Kills the Carried Interest Tax Break?

    Trump's latest tax plan suggestions hint at changes to corporate tax rate but leaves carried interest break unaddressed.
  1. What is the difference between the rule of 70 and the rule of 72?

    Find out more about the rule of 70 and the rule of 72, what the two rules measure and the main difference between them. Read Answer >>
  2. Are there any regulations on transfer pricing?

    Learn about transfer pricing, its role in intra-business calculations, and how the U.S. government regulates transfer pricing ... Read Answer >>
  3. What is a family Limited Liability Company (LLC)?

    Learn about family limited liability (LLC) companies and why they are useful tools in the United States to protect family ... Read Answer >>
Hot Definitions
  1. Diversification

    Diversification is the strategy of investing in a variety of securities in order to lower the risk involved with putting ...
  2. Liquidity

    Liquidity is the degree to which an asset or security can be quickly bought or sold in the market without affecting the asset's ...
  3. Federal Funds Rate

    The federal funds rate is the interest rate at which a depository institution lends funds maintained at the Federal Reserve ...
  4. Call Option

    An agreement that gives an investor the right (but not the obligation) to buy a stock, bond, commodity, or other instrument ...
  5. Standard Deviation

    A measure of the dispersion of a set of data from its mean, calculated as the square root of the variance. The more spread ...
  6. Entrepreneur

    An entrepreneur is an individual who founds and runs a small business and assumes all the risk and reward of the venture.
Trading Center