Investors invest in the units of the Limited Partnership, thus become limited partners.
Flow-through shares
Quebec taxpayers are among the highest in the OECD. Here's a table summarizing the marginal tax rate at both levels (federal and provincial) for different salary levels (year 2023). Source : Turbotax
Flow-through shares
Annual Income 2024 | Marginal tax rate |
150 000$ | 47.46% |
175 000$ | 47.46% |
200 000$ | 49.97% |
250 000$ to plus | 53.31% |
Tax shelters exist to reduce this burden and among these, flow-through shares are a way to reduce it. It should be noted that the Quebec tax system provides generous tax credits and deductions (up to 147% of the investment) to investors who purchase shares in mining assets that qualify under the flow-through share regime.
How to invest in flow-through shares
Investors can access the flow-through share market by purchasing shares directly from qualified mining companies or by investing in a flow-through share limited partnership.
The advantages of investing in flow-through share limited partnerships – available from National Bank Financial – are:
- Professional management
- Access to a wide range of flow-through shares
- Diversification
A few remarks
- Investing in flow-through shares involves risks
- This type of investment is part of a tax optimization strategy
- Our role is to ensure that investors are presented with the options available to optimize their financial and tax situation. Flow-through shares are one of them
- You are invited to consult your accountant or tax specialist to assess whether this type of investment corresponds to your tax situation
The life cycle of flow-through share investments is as follows:
Source: Flow through guide Ninepoint and Maple Leaf
Limited partnership enters into investment agreements with resource companies in exchange for flow-through shares.
Within approximately 12 months the Limited partnership implements a mutual fund rollover transaction.
According to the most recent flow-through share issue (Maple Leaf), the combination of deductions and tax credits available to Québec investors can be up to 147%. Source – Maple Leaf Quebec II 2024
