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MUTUAL FUND TAX GUIDEFor your 2013 Tax Return

MACKENZIE TAX & ESTATE PLANNING

THE LESS TAX YOU PAY,THE MORE YOUR

INVESTMENTS WILL EARN

LESS = MORE


February 2014

Did you know that taxes are probably the biggest expense you’ll face over your lifetime? Now imagine if you could save on taxes to help get the maximum return on your investments. The Mackenzie Mutual Fund Tax Guide is designed to help you do just that. It begins by making it easier for you to understand how your mutual fund investments are taxed and reported on your annual income tax return. Inside, you’ll find explanations of various tax slips, information about 2013 tax rates and changes to tax rules that may affect you.

And the guide also explains a number of specific tax strategies that can help minimize the tax you’ll pay, allowing you to get the most out of your savings and investments. For example, income splitting between family members, including pension income, will free up a considerable amount of tax money that you can save or invest.

Here are a few more tax-savings ideas for you to consider:

• Don’t forget to maximize your Tax-Free Savings Account (TFSA) and invest in mutual funds, which will grow tax-free. The contribution limit for TFSAs has been $5,000 per year since 2009, and increased to $5,500 in 2013. So if you have not yet used your TFSA, you can put in $31,000 in 2014. Not only can withdrawals from your TFSA provide you with non-taxable cash, you can re-contribute the amount withdrawn to your TFSA as long as you remain within your limit.

• As well, money put into a Registered Retirement Savings Plan (RRSP) can defer taxes to future years. The 2013 RRSP maximum is 18% of earned income to a maximum of $23,820 (plus any unused contribution room you may have).

• If you’ve maxed out your registered plans, invest in corporate class funds. Not only do they reduce the tax you pay on your investment income, you can change your investment selection on a tax-deferred basis as your needs dictate. Corporate class funds are also a tax-savings option for corporate investors.

• And if you have a disability, don’t forget to maximize tax-deferred savings in a Registered Disability Savings Plan (RDSP) by “catching” up on matching government grants going back to 2008. Contributions of $3,500 in 2014 and $5,000 in each of 2015 and 2016 will bring an RDSP account up to $31,500 in government grants, with a maximum of $10,500 per year.

• For investors with Mackenzie who file taxes in the United States, a new US-friendly annual information statement (AIS) will be made available on request.

Even though our tax guide is comprehensive, Canada’s taxation system is highly complex and ever-changing. And that’s why I recommend working with a financial advisor to come up with the right tax-savings strategies for you.

Sincerely,

Carol Bezaire Senior Vice President, Tax and Estate Planning Mackenzie Investments

Carol Bezaire Senior Vice President,

Tax and Estate Planning


Contents

CHAPTER 1

What’s new in 2013? ......................................................................................................................................6

CHAPTER 2

All about mutual fund distributions ............................................................................................................. 8

1. What types of income does my mutual fund investment generate?2. Why do some funds issue T3s (RL16 for Québec) and others T5s (RL3 for Québec)?3. Why do funds make distributions?4. Is my year-end distribution prorated if I invest in, say, November or December?5. I didn’t receive any distributions in cash. Why did I still get a tax slip?6. What is “return of capital”? Do I pay tax on this?7. How do I report income from my US-dollar account?8. When I received a distribution, why did the price of my mutual fund drop?9. What if my fund didn’t declare a distribution?10. Do mutual fund corporations pay out distributions in the same manner as mutual fund trusts?11. Do segregated funds pay out distributions in the same manner as mutual fund trusts?

CHAPTER 3

What tax slips will I receive from Mackenzie?.............................................................................................13

1. Non-Registered Accounts - T3 (RL16 for Québec) and others T5s (RL3 for Québec)2. Registered Accounts

2a. Registered Retirement Savings Plans (RRSPs) – RRSP Contribution Receipts 2b. Registered Retirement Income Funds (RRIFs) 2c. Registered Education Savings Plans (RESPs) 2d. Locked-In Retirement Accounts (LIRAs) and Locked-In Retirement Savings Plans (LRSPs) 2e. Life Income Funds (LIFs) and Locked-In Retirement Income Funds (LRIFs) Withdrawal Receipts – T4RIF

(RL2 for Québec) 2f. Registered Disability Savings Plans (RDSPs)

3. Information applicable for non-residents of Canada – NR4

4. Information applicable for US tax filers - PFIC AIS


CHAPTER 4

What happens if I redeemed or exchanged mutual fund securities during the year? ............................18

1. How do I calculate my capital gains or capital losses? 1a. How do I calculate the adjusted cost base (ACB) of my securities? 1b. I know the ACB of my investment. How do I calculate the capital gain or loss?

2. Can I use the adjusted cost base (ACB) shown on my Mackenzie statement?3. What do I do with capital losses?4. How do I report redemptions on my US-dollar account?5. What is a deemed disposition?6. Tax consequences of a fund merger

CHAPTER 5

Mackenzie tax-advantaged products and strategies ...............................................................................28Mackenzie Corporate Class FundsMackenzie Series TTax-Free Savings AccountRegistered Disability Savings Plan (RDSP)The Mackenzie Charitable Giving Fund

CHAPTER 6

Who do I contact if I have questions? ........................................................................................................30

APPENDIX: The Forms .....................................................................................................................31

Quick Facts for Investors

1. Where do I report T3 (RL16 for Québec) distributions on my tax return?2. Where do I report T5 (RL3 for Québec) distributions on my tax return?3. Where do I report RRSP contributions on my tax return?4. Where do I report withdrawals from my RRSP on my tax return? 5. Where do I report withdrawals from my RRIF on my tax return?6. Where do I report my capital gains and losses on my tax return?7. Where do I report my PFIC income?


What’s new in 2013?

CHAPTER 1

1. First-time Donor’s Super Credit (FDSC)The federal charitable donation tax credit provides individuals with a non-refundable tax credit of 15% on the first $200 of annual contributions, plus 29% on donations in excess of $200. Spouses/common-law partners are permitted to combine donations to maximize tax savings. In 2013, the Federal Budget introduced a temporary 25% First-time Donor’s Super Credit. The FDSC is in addition to the foregoing tax credits on the first $1,000 donation. This will raise the credit available on the first $200 to 40% (15% + 25%) and to 54% (29% + 25%) on donations between $200 and $1,000. This calculation will be available for the 2013 tax filings.

Does this new rule apply to you? If you or your spouse/common-law partner have not claimed any donation credits (or the FDSC for years following 2014) since 2007, you would qualify as a First-time Donor.

Please note: Donations must be cash only – donations of appreciated publicly-listed securities will not qualify for the higher tax credit, but will allow any unrealized capital gain to be eliminated if donated in-kind.

2. Extension of Claim Period for the Adoption Expense Tax CreditThe Adoption Expense Tax Credit (AETC) is a 15% non-refundable tax credit that allows adoptive parents to claim eligible adoption expenses relating to the completed adoption of a child under the age of 18 (up to $11,669 per child in 2013). This tax credit has only been available in the taxation year in which an adoption is finalized and only included eligible expenses incurred between the time that a child is matched with his or her adoptive family and the time that the child begins to permanently reside with the family. The change as of 2013 will allow expenses to be used beginning at the time of applying to register for adoption with an approved adoption agency or if an adoption-related application is made to a Canadian court, if that is earlier.

3. Workers Age 60 and Over – Review the Canada Pension Plan Rules as they apply to youIf you are between the ages of 60 and 70 and participated in the workforce in 2013, you should review the rules for CPP contributions (for all employees outside of Quebec). For employees between the ages of 60 and 65, CPP contributions continue to be mandatory, even if you are taking benefits. The employee contribution will be added to the calculation of your benefits in the following years. Once you reach age 65, CPP contributions are optional – but you must make a specific election to opt out.

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4. Extension of the Investment tax creditFlow-through shares allow companies to renounce or “flow through” Canadian exploration expenses to investors who can deduct the expenses in calculating their own taxable incomes. The mineral exploration tax credit is an additional benefit, equal to 15% of specified mineral exploration expenses incurred in Canada and renounced to flow through investors. The 2013 Federal Budget extended eligibility of this credit for one year, to flow-through agreements entered into on or before March 31, 2014.

5. End of Deduction for Safety Deposit Box RentalIn the past, taxpayers could deduct from their income, the annual cost for renting a safety deposit box from their financial institution if it was used in connection with earning investment income from a portfolio (i.e., to store and protect paper documents relating to investments). The Federal Budget eliminated this deduction as of 2013.

6. Tax Reporting Assistance to US Taxpayers investing in Mutual FundsMackenzie Investments and other Canadian mutual funds and Exchange-Traded Funds (ETFs) are viewed differently by the US Tax Authorities (IRS) and Canadian Tax Authorities. The IRS views Canadian mutual funds and ETFs as “Passive Foreign Investment Corporations”, which means they are subject to prescribed tax rules intended to curb the extent to which US persons can defer tax in the US through foreign investments. This can affect investors who reside in the US or who hold US citizenship/green cards and must file tax returns in both Canada and the US. In addition to T3 and T5 Canadian reporting, for affected investors, Mackenzie will provide a US PFIC annual information statement (AIS) which will detail specific ordinary earnings, net capital gains and other distribution information that will ease the burden of the US filings. This personalized tax reporting is available on all series of all Mackenzie Funds.

7


All about mutual fund distributions This chapter describes the distribution process and tax features of mutual funds. For a detailed explanation of how to report distributions on your income tax return, please see Appendix.

CHAPTER 2

1. What types of income does my mutual fund investment generate?Mutual funds invest in a variety of stocks, bonds and other securities that generate various types of income for the fund. Also, when the fund sells an investment, it realizes a capital gain or capital loss on the transaction.

Canadian dividends and capital gains are taxed at a lower rate by the federal and provincial governments compared to other income sources.

Dividend income is eligible for the dividend tax credit and only 50% of a capital gain is taxed. As with your salary, interest income is fully taxed at your highest personal tax rate during the year.

2. Why do some funds issue T3s (RL16 for Québec) and others T5s (RL3 for Québec)?The type of income that your fund distributes to you will vary depending on whether the fund is structured as a mutual fund “trust” or a mutual fund

The following table shows how each type of income is taxed.

InvestmentType of

income earned Tax category

Highest marginal tax rate*

(Ontario 2013)

After-tax value of $100

of income at highest

marginal tax rate in Ontario

Highest marginal tax rate

(Québec 2013)

After-tax value of $100 of income at highest marginal

tax rate in Québec

Shares of Canadian corporations

Dividends Eligible Dividends

29.5% $71 35.2% $65

Other income Other income 46.4% $54 50.0% $50

Foreign stocks and bonds

Foreign interest and dividends

Foreign non-business

income

46.4% $54 50.0% $50

Canadian treasury bills, bonds, and mortgages

Interest Other income 46.4% $54 50.0% $50

When the fund sells investments

Capital gains (losses)

Capital gains (losses)

23.2% $77 25.0% $75

For a more detailed description of the income distributions of mutual fund trusts compared to mutual fund corporations, please see Question 10 in this chapter.

*This ignores the 2% surtax that applies on income in excess of $509,000.



“corporation.” Mutual fund trusts issue a T3 tax slip and mutual fund corporations issue a T5 tax slip containing investment income information.

Residents of Québec will also receive a RL16 tax slip with their T3 tax slip and a RL3 tax slip with their T5 tax slip.

3. Why do funds make distributions?Funds make distributions so that, overall, you pay less tax. Here’s how:• Income earned by a mutual fund is subject to tax.

If the income remains in the fund, the fund will pay the tax. However, if the income is distributed to investors, they pay the tax.

• Since mutual funds always pay tax at the highest tax rate for each category of income, and since many investors are taxed at a lower rate, the fund pays out the income so that it is taxed at a lower rate in the investor’s hands rather than at the higher rate in the fund. Therefore, all investors are better off by having the fund pay a distribution.

• Many mutual fund investments are held inside registered plans. Distributions paid by a mutual fund into a registered plan are not taxable until withdrawn.

4. Is my year-end distribution prorated if I invest in, say, November or December? If you have investments in a fund when it pays a distribution, you will receive the full distribution, regardless of how long you have owned the fund.

The distribution received by each investor is determined by the number of units owned by that investor on the “record day” for the distribution multiplied by the declared distribution per unit.

Investments purchased in non-registered accounts late in the year may have tax implications. For more information, please consult your financial advisor.

5. I didn’t receive any distributions in cash. Why did I still get a tax slip?

Distributions made by each fund are reinvested automatically to purchase additional units/shares of the fund. No sales charge is payable under this automatic reinvestment program.

Not all mutual fund distributions are taxed in the same manner. For example, mutual fund trusts distribute taxable income generated from a number of sources, from fixed income investments to equities. By comparison, a corporate class fund distributes only Canadian dividends or capital gains, which are taxed at a preferential rate. Remember, paying less tax can increase your overall investment returns, so when investing consider the structure of your mutual fund.

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9MUTUAL FUND TAX GUIDE 2013



Automatic reinvestment of distributions, however, does not provide any tax benefit. You receive the same tax treatment as you would if you actually received cash distributions and immediately purchased more units of the fund.

When distributions are automatically reinvested, however, you profit from the compounding growth of the value of your investment. When you use Mackenzie Investments One-Step Dollar Cost Averaging you benefit from dollar cost averaging in a non-registered account, which reflects the various purchase prices every time a distribution is reinvested. This affects your adjusted cost base and may reduce the tax payable when you sell units.

6. What is “return of capital”? Do I pay tax on this?Distributions from some funds include a return of capital. This is an amount included in the distribution that is above and beyond the taxable income of the fund for the year.

You do not pay tax on this amount and you do not include it in your taxable income for the year. The return of capital, however, may cause a decrease to your adjusted cost base. When you sell your fund, a higher capital gain may result.

The “return of capital” is included in the detailed breakdown of distributions on the back of the tax slip so that you can calculate the adjusted cost base of your investment (see the adjusted cost base calculation on pages 19-22).

For a T3, it is found in box 42. T5 tax slips do not record this amount.

7. How do I report income from my US-dollar account?For Canadian income tax purposes, all transactions must be reported in Canadian dollars. Your T3 (RL16 for Québec) and T5 (RL3 for Québec) tax slips have been issued in Canadian dollars. Distributions paid to your US dollar account have been converted to Canadian dollars at the rate of CDN$1.0299.

On the back of your T3 (RL16 for Québec) or T5 (RL3 for Québec) slip we have indicated the relevant exchange rates.

8. When I received a distribution, why did the price of my mutual fund drop?When a fund makes a distribution, its unit price drops by an amount equal to the distribution per unit. However, the overall value of your investment is unchanged. Here’s why:

If your distributions are automatically reinvested, they are used to purchase more units of the fund. As a result, you will own more units. When you multiply the higher number of units by the new, lower price, you will find that the value of your holdings is unchanged.

If your distributions are paid out in cash, the remaining value of your investments plus the cash in hand will equal the value of your holdings before the distribution.

9. What if my fund didn’t declare a distribution? Distributions are not an indicator of fund performance. There is no link between the amount of the distribution made by a fund in any year and the fund’s performance for that year.

CHAPTER 2



Unless a fund has a fixed distribution, generally a distribution is paid to ensure that the fund does not have to pay tax.

Any increase in the value of investments in the fund are not included in the taxable income of the

fund until an investment is sold. In this way, the increase in value of the mutual fund’s investments can compound tax-free until they are sold and new investments are acquired.

Activity Calculations Total Investment Value

Before a distribution You own 100 units at $10 per unit. $1,000

Distribution declared Distribution of $0.50 per unit. You receive $50 (100 units x $0.50)

Unit price drops The fund unit price is now $9.50. ($10.00 less $0.50)

Distribution reinvested You reinvest the $50 to buy additional units at $9.50 per unit.

You receive 5.263 units ($50 ÷ $9.50 = 5.263) so that you now own 105.263 units

After the distribution (if you reinvested)

You own 105.263 units at $9.50 per unit. $1,000

After the distribution (if you received cash)

You own 100 units at $9.50 per unit. You received $50 in cash.

$950 $50

$1,000

The following example of an investment in a mutual fund trust shows why the value of your investment remains unchanged when you receive a distribution.

Performance Component Taxable?

Net income, which is equal to dividend and other income earned by the fund less management expenses

Yes

Realized gains on the sale of portfolio securities Yes

Unrealized gains from market appreciation of portfolio securities No

To understand this, let’s look at the components of fund performance:



10. Do mutual fund corporations pay out distributions in the same manner as mutual fund trusts?No, trusts and corporations pay out differently.When income is distributed from a mutual fund trust, it “flows through” to the investor so that the trust can distribute the full range of income shown in the table on page 8.

The trust may also flow through the dividend tax credit and a foreign non-business tax credit. This arises when the fund has tax withheld by foreign governments on interest and dividends earned in foreign countries.

Mutual fund corporations can only flow through Canadian dividends, capital gains dividends and the dividend tax credit.

11. Do segregated funds pay out distributions in the same manner as mutual fund trusts?Although segregated funds and mutual funds have many similarities, there are some differences in how segregated funds are treated under the Canadian Income Tax Act.

Segregated fund investors are not investors of a fund, but contract holders of an insurance policy. This means that income earned in the segregated fund is deemed to be allocated to the contract holders, not distributed out to investors as with a mutual fund. In other words, allocations are not paid out to investors by way of a cheque or through the purchase of additional units, but instead all income is reinvested and reflected by an increase in the unit price. Allocations are reflected by an increase or decrease in the adjusted cost base (ACB).

Looking for income while paying the least amount of tax as possible? Mutual funds offer both systematic withdrawal plans (SWPs) and tax-efficient withdrawals from corporate class funds (Series T). Both options provide cash flow that is a combination of tax-free return of capital and capital gains or dividends, which are taxed at a far lower rate than income.

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CHAPTER 2


MUTUAL FUND TAX GUIDE 2013 13

What tax slips will I receive from Mackenzie?

CHAPTER 3

1. Non-Registered Accounts – T3 (RL16 for Québec) and T5 (RL3 for Québec)To provide you with investment income information, mutual fund trusts issue T3 tax slips and mutual fund corporations issue T5 tax slips. Residents of Québec also receive a Relevé 16 tax slip for distributions from a mutual fund trust and a Relevé 3 for distributions from a mutual fund corporation.

These tax slips do not record any capital gains or losses that you may have realized on the redemption of your mutual fund investment during the year. Tax reporting requirements on the redemption or disposition of your investments are discussed on page 18.

To reduce the number of tax slips you receive, Mackenzie issues a consolidated T3 tax slip for distributions from Mackenzie funds that are trusts, and a separate consolidated T5 tax slip for distributions from funds that are corporations.

The back of each T3 (RL16 for Québec) and T5 (RL3 for Québec) shows a detailed breakdown, by fund, of the distributions.

Mackenzie issues a tax slip if you received $1 or more in distributions from a fund during the year. However, if you received less (as shown on your annual statement of account), you are still required to report this amount on your income tax return.

T3 (RL16 for Québec) and T5 (RL3 for Québec) tax slips are issued for non-registered accounts only.

Distributions paid to registered accounts (RRSP, RRIF, RESP, LIF, LIRA, LRIF, PRIF, DPSP, RPP, LRSP, GRSP, RDSP and TFSA) are not taxable as they remain in the tax shelter.

2. Registered AccountsDepending on the type of registered plan, you may receive contribution and withdrawal receipts. Tax receipts that are used for these taxable transactions are described on the following pages.

You will not receive a receipt for distributions made by the funds to a registered plan because they are not subject to tax. As well, capital gains (or losses that are realized on the redemption or exchange of your investments within a registered plan) are also not taxable until the funds are taken out of the plan. You do not report them on your tax return until the funds are taken out of the plan. The distribution cannot be used as a deductible RRSP contribution.

Tax receipts will not be provided for withdrawals made from your Tax-Free Savings Account (TFSA) because withdrawals are not taxable. But if a TFSA holder dies, the recipient of the TFSA may be taxed on any growth in the TFSA from the date of death to the date of distribution.

A T4A receipt will be issued for any portion of the deceased’s TFSA that may be taxable.



2a. Registered Retirement Savings Plans (RRSPs) – RRSP Contribution ReceiptsWhen you make an RRSP contribution, you can generally deduct the amount from your income on your tax return, thereby reducing the amount of tax you pay.

We issue three types of contribution receipts (r1, r2, r3). The type you will receive depends on when you made the contribution, and whether you transferred in a retiring allowance to your RRSP.

r1 “Rest of Year” receipts If you made a contribution to your Mackenzie RRSP, or your spouse’s Mackenzie RRSP, between March 1, 2013 and December 31, 2013, you will receive a “Rest of Year” contribution receipt. This receipt is marked “Contributions During the Remainder of 2013.”

r2 “1st 60 days” receipts If you made contributions during the first 60 days of 2014, you will receive a contribution receipt marked “1st 60 days.” If you make more than one contribution during this period, you may receive more than one receipt. You have until March 3, 2014 to make a contribution that is deductible from your 2013 income.

We consolidate RRSP receipts for the 1st 60 days for systematic contributions (this includes Pre-Authorized Chequing transactions & Group RSP contributions). These transactions are consolidated and issued after the deadline. The only RRSP receipts that we issue ‘on the fly’ are for lump sum contributions.

r3 Transfer of a Retiring Allowance to a Mackenzie RRSP If you transferred in a Retiring Allowance under section 60(j.1) of the Income Tax Act, you will receive a separate contribution receipt in that amount.

Is the receipt different for a contribution made to a spousal plan?Yes, slightly. Under the section, “Name of annuitant,” the name of your spouse will be shown.

The social insurance number (SIN) of your spouse will also appear.

If the contribution is not for a spousal plan, then the “Name of annuitant” section will state “same as contributor” and only your SIN will be shown.

Always take advantage of tax-deferred compounding to help your investments grow faster. One way to do this is to invest in a corporate class fund which allow you to change your asset mix. When you do, you won’t have to pay tax on your capital gain or loss until you want to. And by paying less tax, you’ll have a greater amount of money working for you.

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CHAPTER 3



RRSP Withdrawal Receipts – T4RSP (RL2 for Québec)If you withdraw funds from an RRSP, you must add the amount of the withdrawal to your income. By law, we are required to withhold a percentage of the amount withdrawn and send it to Canada Revenue Agency or Revenu Québec. When completing their tax returns, residents may owe additional tax to Canada Revenue Agency or Revenu Québec. Withholding tax rates are listed on page 32.

If you made a withdrawal from your RRSP during the year, you will receive a T4RSP (RL2 for Québec). This receipt shows the amount withdrawn, after allowing for any redemption charges if applicable, and any tax that has been withheld. If you are a non-resident, you will receive an NR4 receipt that shows the net amount withdrawn and the tax that has been withheld.

If I make a withdrawal from more than one fund, how many receipts will I receive?You will receive a single T4RSP (RL2 for Québec) tax receipt if the withdrawals were from the same account.

What happens if my spouse made a withdrawal from an RRSP to which I contributed?Your spouse will receive a T4RSP (RL2 for Québec) and will generally include the withdrawal in his or her income. However, if the withdrawal was made in the year in which you contributed to the plan, or in the previous two calendar years, you must include the amount withdrawn in your income for the year in which the withdrawal was made. This rule does not apply if you are separated or divorced.

2b. Registered Retirement Income Funds (RRIFs)Each year, other than the year in which the RRIF is established, you must withdraw a minimum amount from your RRIF. Withdrawals from a RRIF are included as income in the year of withdrawal. If you withdraw more than the minimum amount, we must withhold tax at the time of withdrawal. The minimum amount to be withdrawn, and the amount of tax required to be withheld on withdrawals over this amount, depends on the following factors:

• the value of the account, • your age (the annuitant), or your spouse’s age, and • the year in which you moved the RRSP assets

to a RRIF.

Please consult your financial advisor for more information.



Do I receive a contribution receipt when I transfer an RRSP to a RRIF?In most instances you will not receive a receipt on the transfer of your RRSP to a RRIF.

Can I transfer other amounts to a RRIF? Yes, in very limited circumstances. For example, if your spouse dies and you are the sole beneficiary of your spouse’s RRSP, you are permitted to transfer their RRSP to your RRIF on or before December 31 of the year after the year of death. In this instance you will receive two receipts, a T4RSP (RL2 for Québec) to report the income inclusion and a contribution receipt for the same amount that will offset the income inclusion.

RRIFs Withdrawal Receipts – T4RIF (RL2 for Québec)If you made a withdrawal from your RRIF during the year, you will be issued a T4RIF (RL2 for Québec). It will show the amount withdrawn and the tax that has been withheld. If you are a non-resident, you will receive an NR4 receipt.

2c. Registered Education Savings Plans (RESPs)Contributions made to an RESP are not tax-deductible, and therefore you will not receive a tax receipt. There is no maximum annual contribution to a RESP, but there is a lifetime limit of $50,000.

The federal government has provided a Canada Education Savings Grant (CESG) equal to 20% of the first $2,500 annual contribution to a RESP per beneficiary under the age of 18.

The maximum annual grant is $500 creating a maximum lifetime total grant of $7,200. Additional grants are also available for low-to-middle income families as well as for Alberta residents.

The Quebec government offers the Quebec Education Savings Incentive which pays a grant of up to $250 annually into an RESP. Depending on family income up to an additional $50 per year can be added to the basic grant. Grants are retroactive for up to three years.

The Saskatchewan government offers the Saskatchewan Advantage Grant for Education Savings (“SAGES”) which pays a grant of up to $250 annually into an RESP. Legislation was implemented in 2013 for retroactive payments back to January 1, 2013.

Please ask your advisor if you qualify. You will not receive the grant payments in cash, instead Human Resources and Skills Development Canada forwards the grant(s) to Mackenzie for investment in the RESP.

Investing on behalf of a child under age 18 outside of an RESP can pose tax problems for the adult contributor. Under the Canadian Income Tax Act, income other than capital gains is “attributed” to the adult and capital gains are taxed in the hands of the child. The tax burden can be reduced by investing in a corporate class fund, which allows you to defer taxes.

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CHAPTER 3



The “growth” portion of the RESP (i.e., all interest, dividends, CESG and capital gains generated by the contributions) at the time that it is paid out to the beneficiary from the plan is included in the income of the beneficiary in the year of payment. A T4A (RL1 for Québec) tax receipt will be issued to the beneficiary for the growth portion paid out (the original amounts contributed to the RESP are paid out tax-free).

2d. Locked-In Retirement Accounts (LIRAs) and Locked-In Retirement Savings Plans (LRSPs)Since the assets in these accounts are locked in, tax receipts are not normally issued.

2e. Life Income Funds (LIFs) and Locked-In Retirement Income Funds (LRIFs) Withdrawal Receipts – T4RIF (RL2 for Québec)If you made a withdrawal during the year from your LIF or LRIF, you will be issued a T4RIF (RL2 for Québec), which will show the amount withdrawn, and the tax that has been withheld if applicable. Non-residents will receive an NR4 receipt.

2f. Registered Disability Savings Plans (RDSPs)Contributions to an RDSP are not tax-deductible, and therefore you will not receive a tax receipt. There is no maximum annual contribution to an RDSP, but there is a lifetime limit of $200,000. Contributions to an RDSP can be invested and grow tax-deferred, and the Government of Canada provides generous grants and bonds to eligible beneficiaries.

The “growth” portion of the RDSP (i.e., all interest, dividends, Canada Disability Savings Grants, Canada Disability Savings Bonds and capital gains generated by the contributions) is taxable to the beneficiary when it is withdrawn from the RDSP.

A T4A tax receipt will be issued to the beneficiary for the growth portion that is paid out.

3. Information applicable for non-residents of Canada – NR4Non-residents holding a non-registered account will not receive a T3 or T5 tax slip but instead will receive an NR4 supplementary tax slip to report the taxable portion of the distributions from the funds. The NR4 tax slips have not been consolidated and you will receive a separate receipt for each of your funds that paid a distribution.

Depending on your country of residence, Mackenzie must withhold 15% to 25% tax on your distribution, excluding any capital gains or return of capital components.

Your distribution, excluding any return of capital component, is shown in Box 16 “Gross Income.” The tax, which Mackenzie withheld from your distribution and remitted to Canada Revenue Agency, is shown in Box 17.

Withholding taxes paid to Canada Revenue Agency are generally deductible against tax payable in your country of residence.

If you made withdrawals from a registered account in the year, you will receive an NR4 tax slip that shows the amount withdrawn in Box 16 and the tax that has been withheld in Box 17.

4. Information applicable for US tax filers – PFIC AISIn addition to an NR4, T3 or T5, Mackenzie will supply a PFIC (AIS) or detailed income statement as required.

For further information, please consult your financial or tax advisor.


18 MUTUAL FUND TAX GUIDE 2013

What happens if I redeemed or exchanged mutual funds securities during the year?

CHAPTER 4

Registered AccountsIf you hold your securities in a registered account (RRSP, RRIF, RESP, LIF, LIRA, LRIF, PRIF, DPSP, RPP, LRSP, GRSP and TFSA), any gains realized on the redemption of those units are not subject to tax.

Non-Registered AccountsIf you hold your securities in a non-registered account, and redeemed or exchanged your securities during the year, you will need to report the corresponding capital gains or losses on your tax return.

Please refer to your Annual Statement of Account to identify redemptions or exchanges that occurred during the year. In addition, you will also need to report any deemed dispositions. Please see page 23.

Fund ExchangesAn exchange is the sale of securities of one fund to purchase securities of another fund. When you exchange Fund A for Fund B, you have actually sold, or “redeemed” Fund A and purchased Fund B. It is therefore a taxable transaction.

Fund Switches However, if you switch from shares of one fund to shares of another fund within the Mackenzie Capital Class structure, the switch occurs on a tax-deferred “rollover” basis so that you will not realize a capital gain or capital loss on the switch.

The cost of the shares of the new fund acquired on a switch will be equal to the adjusted cost base of the shares switched from the old fund. If you change shares of one series of a fund to another series of the same fund, the tax consequences are similar.


Calculating your adjusted cost base (ACB)For actions you can take with respect to capital losses, please see page 23.

1. How do I calculate my capital gains or capital losses?To calculate your capital gains or capital losses, you first need to calculate the adjusted cost base (ACB) of your units.

The following tables describe, and walk you through, the ACB and capital gains calculations using a hypothetical example.

1a. How do I calculate the ACB of my securities? The ACB is easier to calculate on a total investment basis rather than on a per unit/share basis. To obtain the ACB per unit/share, divide the total ACB by the number of units/shares held.

For a partial redemption, the capital gain or loss is determined by multiplying the ACB per unit/share by the number of units/shares redeemed.


The total of all amounts paid to purchase your securities including any sales commission paid at the time of purchase

The amount of any reinvested distributions

The return of capital component of distributions

The ACB of any securities previously redeemed

The ACB of your securities+ - - =

To make sure your adjusted cost base (ACB) is correct, it’s important to keep accurate records of your mutual fund transactions, including reinvested distributions. Your ACB affects the tax you pay on your capital gain (or loss) which occurs when you sell your mutual fund units.

MACKENZIE TAX TIP5



Transaction 1 – Purchase

During 2012 an investor purchased $5,000 of Fund A, a Mutual Fund Trust at $14.00 per unit for a total of 357.143 units ($5,000 divided by $14.00).

Transaction 2 – Purchase

Later during 2012, the investor made a second purchase of $5,000 of Fund A at $15.00 per unit for a total of 333.333 units ($5,000 divided by $15.00).

Transaction 3 – Distribution

On December 31, 2012, the fund paid a distribution of $0.30 per unit.

This investor received a distribution of $207.14 (690.476 units x $0.30) which was reinvested in additional units at $16.6701 per unit, the price at year end. 12.426 additional units were purchased ($207.14 divided by $16.6701).

The distribution also included a return of capital of $0.0073 per unit, or $5.04 in total (690.476 units x $0.0073).

After the distribution, the ACB becomes $14.5142 per unit ($10,202.10 divided by 702.902 units).

Transaction 4 – Redemption

On June 30, 2013, the investor redeemed 300 units at $18 per unit for gross redemption proceeds of $5,400.00. The investor paid a 5.5% redemption fee at that time and therefore received net proceeds of $5,103 in cash (5.5% x $5,400 = $297 redemption fee).

The ACB of the 300 units redeemed is $4,354.26 (300 multiplied by the ACB per unit of $14.5142). The total Adjusted Cost Base of the remaining units is reduced by $4,354.26.

The new total ACB is $5,847.84, the remaining number of units is 402.902 and the ACB per unit remains at $14.5142.

The ACB per unit immediately after a partial redemption is the same as the ACB per unit immediately before the redemption.

ACB Example (refer to the next page for calculations)

CHAPTER 4



The ACB of your units, on a total investment basis is equal to the following:

The ACB would be calculated as follows:

Transactions 1 & 2 Total Cost Units ACB Per Unit

The total of all amounts paid to purchase your units, including any commissions you paid at the time of purchase:

$5,000.00 357.143 14.0000

$5,000.00 333.333

$10,000.00 690.476 14.4828

Transaction 3

Plus:

The amount of any reinvested distributions $207.14 12.426

Less:

The return of capital component of distributions (regardless of whether or not the distribution was paid in cash or reinvested in additional units)

($5.04)

$10,202.10 702.902 14.5142

Transaction 4

Less:

The Adjusted Cost Base of any units redeemed ($4,354.26) (300.00) 14.5142

Adjusted Cost Base of units remaining $5,847.84 402.902 14.5142

ACB Calculations


1b. I know the ACB of my investment. How do I calculate the capital gain or loss? The capital gain or loss from the example shown would then be calculated as follows:


Proceeds of disposition $5,400.00

(the gross amount of the redemption which is equal to the net asset value per security “the price” on the date of the redemption multiplied by the number of units redeemed i.e., $18 per unit x 300 units):

Less

The Adjusted Cost Base of the securities (see Adjusted Cost Base calculation in previous chart)

($4,354.26)

Less:

Any expenses incurred on the redemption of the securities (such as redemption fees and administrative costs i.e., 5.5% redemption fee – $5,400 x 5.5%)

($297.00)

Capital gain (loss) $748.74

Activity

CHAPTER 4



2. Can I use the adjusted cost base (ACB) shown on my Mackenzie statement?

You should always use your own investment records to calculate the adjusted cost base and the capital gain or loss. Mackenzie is required to report your sale or switch from one fund to another mutual fund except a switch within the Mackenzie Corporate Class structure, to Canada Revenue Agency. Please refer to your statement, which contains necessary information for completing your income tax return for reporting capital gains and losses. You will not receive any other form (T5008) (RL18 for Québec), which provides information for capital gain and loss calculations. While every effort is made to ensure the accuracy of the ACB of your securities, our record keeping cannot include any adjustments that are specific to your individual circumstances, such as a deemed disposition. (Please see section 5 on this page for a description of deemed dispositions.) Also, the ACB shown on your statement may not include all adjustments for the return of capital component of distributions.

For tax purposes, you are required to maintain records to support the amounts reported on your tax returns. An ACB worksheet similar to that shown on the previous page will assist you in your record keeping.

3. What do I do with capital losses?Capital losses can only be used to reduce or offset capital gains realized in the current tax year, the previous three taxation years, or they can be carried forward indefinitely to reduce future capital gains.

To carry back a net capital loss, you must file Form T1A – “Request for loss carryback” and file it with the tax return for the year in which the loss arises. You can obtain copies of the form from your local tax office or get it online.

4. How do I report redemptions on my US-dollar account? For Canadian income tax purposes, all transactions must be reported in Canadian dollars. You will have to translate the US-dollar proceeds to Canadian dollars. The ACB of your investment needs to be converted from US dollars to Canadian dollars using the exchange rate in effect at the time of each transaction for purchases, reinvested distributions, and the return of capital component of distributions.

5. What is a deemed disposition? Transactions other than a redemption may give rise to a “deemed disposition.”

The types of transactions that can give rise to a deemed disposition include, but are not limited to, the following:

• Death of an investor in most circumstances

• The transfer of your securities from a non-registered investment account to an RRSP (any deemed capital losses arising on the transfer are deemed to be nil)

• If you “gift” the securities to someone other than your spouse (if you gift property to your spouse, the “attribution” rules may apply)

• Ceasing to be a Canadian resident



The proceeds of a deemed disposition are equal to the fair market value of the investment at the time of the transaction. Generally, the difference between the deemed proceeds of disposition and the adjusted cost base will result in a capital gain or loss.

Please consult Canada Revenue Agency’s “Capital Gains Guide” or your financial or tax advisor for more information.

6. Tax Consequences of a Fund MergerMackenzie may initiate a fund merger where the interest of investors in certain funds are best served by merging the fund into another. Fund mergers can only proceed with investor approval or by Independent Review Committee approval combined with advance investor notice. Approval from Canadian securities regulators may also be required.

Trust-to-Class MergerUnits of the discontinued mutual fund trust are exchanged for shares of the continuing Mackenzie corporate class fund. This merger results in a disposition of the investor’s units for proceeds equal to the fair market value of the shares received on the merger.

Non-Registered InvestorsIf a capital gain is realized on the merger, an investor has two options:

1. To report the Capital Gain: An investor will report the disposition of the mutual fund trust units on Schedule 3 of their income tax return for the taxation year that includes the date of the merger.

2. To defer the Capital Gain: An investor must complete a Tax Election Form and Power of Attorney, including signatures, and send it to Mackenzie before the relevant due date. You can obtain this tax package by calling Mackenzie Client Relations at 416-922-3217 (or 1-800-387-0614). This will authorize Mackenzie to complete the necessary tax election forms and file them on the investor’s behalf with CRA (and Revenu Québec, if applicable) to defer the capital gain on the investor’s units until the investor disposes of their shares of the Mackenzie corporate class fund. The investor, for this option, is not required to report the merger transaction on their income tax return.

CHAPTER 4



If a capital loss is realized on the merger, this amount should be reported on Schedule 3 of the investor’s income tax return to offset any capital gains that an investor realized during the year. Furthermore, any unused portion of the investor’s capital losses can be used to reduce capital gains realized in the previous three taxation years or they can be carried forward indefinitely to reduce future capital gains.

Registered InvestorsThere is no tax impact to registered investors.

Trust-to-Trust Merger or Class-to-Class Merger – Tax-Deferred MergersUnits of the discontinued mutual fund trust/class are exchanged for units of the continuing mutual fund trust/class. This transaction for Canadian income tax purposes is not a disposition and thus is not taxable to the investor. The cost of the new units of the continuing fund is equal to the adjusted cost base of the units that were originally held.

Trust-to-Trust Taxable MergersUnits of the discontinued mutual fund trust are exchanged for units of the continuing Mackenzie Fund. This merger results in a disposition of the investor’s units for proceeds equal to the fair market value of the units received on the merger.

More income tax information on mergers can be found in the information circulars sent to investors or on our website at mackenzieinvestments.com.


Date Terminating Fund Name Continuing Fund Name Type of Merger

August 2, 2013 Mackenzie All-Sector Canadian Balanced Fund

Symmetry Balanced Portfolio Trust to Trust

August 2, 2013 Mackenzie Cundill Global Balanced Fund Mackenzie Cundill Canadian Balanced Fund Trust to Trust

August 2, 2013 Mackenzie Cundill Global Dividend Fund Mackenzie Global Dividend Fund (formerly known as Mackenzie Universal Global Infrastructure Income Fund)

Trust to Trust

August 2, 2013 Mackenzie Cundill International Class Mackenzie International Growth Class (formerly known as Mackenzie Universal International Stock Class)

Corp to Corp

August 2, 2013 Mackenzie Focus Far East Class Mackenzie Emerging Markets Class (formerly known as Mackenzie Universal Emerging Markets Class)

Corp to Corp

August 2, 2013 Mackenzie Focus International Class Mackenzie International Growth Class (formerly known as Mackenzie Universal International Stock Class)

Corp to Corp

August 2, 2013 Mackenzie Focus Japan Class Mackenzie International Growth Class (formerly known as Mackenzie Universal International Stock Class)

Corp to Corp

August 2, 2013 Mackenzie Ivy All-Canadian Class Mackenzie Canadian All Cap Value Class (formerly known as Mackenzie Saxon Stock Class)

Corp to Corp

August 2, 2013 Mackenzie Maxxum All-Canadian Dividend Class

Mackenzie Canadian All Cap Dividend Class (formerly known as Mackenzie Saxon Dividend Income Class)

Corp to Corp

August 2, 2013 Mackenzie Maxxum Monthly Income Fund Mackenzie Canadian All Cap Balanced Fund (formerly known as Mackenzie Saxon Balanced Fund)

Trust to Trust

August 2, 2013 Mackenzie Sentinel Managed Return Class Mackenzie Canadian Bond Fund (formerly known as Mackenzie Sentinel Bond Fund)

Corp to Trust

August 2, 2013 Mackenzie Universal All-Canadian Growth Class (A Class)

Mackenzie Canadian All Cap Value Class (formerly known as Mackenzie Saxon Stock Class)

Corp to Corp

August 2, 2013 Mackenzie Universal All-Canadian Growth Class (B Class)


Corp to Corp

August 2, 2013 Mackenzie Universal Canadian Shield Fund Mackenzie Canadian All Cap Value Class (formerly known as Mackenzie Saxon Stock Class)

Trust to Corp

August 2, 2013 Mackenzie Universal Health Sciences Class Mackenzie US Growth Class (formerly known as Mackenzie Universal North American Growth Class)

Corp to Corp

August 2, 2013 Mackenzie Universal Technology Class Mackenzie US Growth Class (formerly known as Mackenzie Universal North American Growth Class)

Corp to Corp


Fund Mergers – January 1, 2013 to December 31, 2013

CHAPTER 4


Date Terminating Fund Name Continuing Fund Name Type of Merger

August 2, 2013 Mackenzie Universal U.S. Emerging Growth Class

Mackenzie Global Small Cap Growth Class (formerly known as Mackenzie Ivy Enterprise Class)

Corp to Corp

August 2, 2013 Mackenzie Universal World Real Estate Class

Mackenzie Global Dividend Fund (formerly known as Mackenzie Universal Global Infrastructure Income Fund)

Corp to Trust

August 16, 2013 Mackenzie Saxon Microcap Fund Mackenzie Canadian Small Cap Value Class (formerly known as Mackenzie Saxon Small Cap Class)

Trust to Corp

August 16, 2013 Mackenzie All-Sector Canadian Equity Fund


Trust to Corp

August 16, 2013 Mackenzie Cundill World Fund Mackenzie Cundill Value Class Trust to Corp

August 16, 2013 Mackenzie Focus All-Canadian Class Mackenzie Canadian All Cap Value Class (formerly known as Mackenzie Saxon Stock Class)

Corp to Corp

August 16, 2013 Mackenzie Ivy European Fund Mackenzie Ivy European Class Trust to Corp

August 16, 2013 Mackenzie Maxxum All-Canadian Equity Class


Corp to Corp

August 16, 2013 Mackenzie Sentinel Short-Term Government Bond Fund

Mackenzie Canadian Short Term Income Fund (formerly known as Mackenzie Sentinel Short-Term Income Fund)

Trust to Trust

August 16, 2013 Mackenzie Universal Global Growth Fund Mackenzie Global Growth Class (formerly known as Mackenzie Universal Global Growth Class)

Trust to Corp

August 16, 2013 Mackenzie Universal Precious Metals Fund Mackenzie Precious Metals Class (formerly known as Mackenzie Universal World Precious Metals Class)

Trust to Corp

December 6, 2013 Mackenzie Sentinel Cash Management Fund

Mackenzie Canadian Money Market Fund (formerly known as Mackenzie Sentinel Money Market Fund)

Trust to Trust


Fund Mergers – January 1, 2013 to December 31, 2013


Mackenzie tax-advantaged products and strategies

CHAPTER 5

Mackenzie Corporate Class FundsBeing tax-efficient is important when investing outside of registered plans such as RRSPs, RESPs and TFSAs. Investors can build wealth faster by minimizing and deferring tax. Mackenzie’s corporate class funds are designed to minimize and defer tax by providing investors with three key benefits:

1. Tax-efficient growthIf you invest in GICs, bonds, or dividend-paying stocks, you’ll pay tax every year for as long as you hold the investment. But if you invest in Mackenzie’s corporate class funds, you may not pay tax until you redeem your investment. The less tax you have to pay along the way, the faster your investment will grow.

2. Tax-efficient incomeIf the income you draw from your investments comes from interest, dividends or from capital gains on investments that you sell, then some of it will be taxed away. By comparison, many of Mackenzie’s corporate class funds provide monthly income that is completely tax-deferred. This means you can take smaller before-tax payments from these investments and receive the same after-tax income.

3. Tax-efficient rebalancingAs your financial plan unfolds, or as your financial goals change, you’ll need to rebalance your investment portfolio. Rebalancing a portfolio can lead to the realization of capital gains and an unwelcome tax bill. With Mackenzie’s corporate class funds, any capital gains resulting from a rebalancing are deferred until you redeem your investment.

Mackenzie Series TMackenzie’s Series T funds provide investors with a tax-efficient, monthly cash flow from a selection of our leading corporate class funds. Series T funds are an alternative to a systematic withdrawal plan, where investors redeem their investments on a regular basis, drawing down their balance and pay tax immediately. • Offers high, stable monthly cash flow• 5%, 6%, 8% annualized distribution options • Tax-deferred monthly income from corporate

class funds• Growth potential through mutual funds

Tax-efficient Symmetry Portfolio ClassesMackenzie's seven Symmetry Portfolio Classes address an investor's specific risk tolerance, ranging from low, with Symmetry Conservative Income Portfolio Class, to higher with Symmetry Equity Class. As your financial plan unfolds, you may want to change to another Symmetry Portfolio Class. And because the portfolios are available in a tax-efficient corporate class version, you can move between portfolios without triggering a capital gains tax until you redeem your investment.



Tax-Free Savings AccountEvery Canadian 18 and older can save up to $5,500 (2014) every year in a TFSA, and all investment income (including interest, dividends, and capital gains) earned in a TFSA grows tax-free.

• Withdraw funds at any time, for any purpose, tax-free.

• Money can be used for any purpose, from emergencies to home renovations or starting a new business.

• TFSA savings room is never lost. If you withdraw $7,000 from your TFSA, you can re-contribute this amount in a future year without requiring additional contribution room.

Registered Disability Savings Plan (RDSP)The RDSP is a tax-deferred savings vehicle introduced by the Government of Canada to help parents and others save for the long-term financial security of a person with a severe and prolonged disability. To assist in saving, the Federal Government offers the Canada Disability Savings Grant (CDSG) and Canada Disability Savings Bond (CDSB) to qualifying participants until the beneficiary of the plan reaches age 49.

Contributions can be made by anyone, to a maximum lifetime contribution of $200,000 per individual.

The Mackenzie Charitable Giving FundThe Mackenzie Charitable Giving Fund is a donor-advised giving program designed to provide you with a more focused approach to giving. With Mackenzie Charitable Giving Fund, you get the advantages of a private foundation without upfront costs and administrative responsibilities. It is a convenient way of giving that combines immediate tax benefits with the ability to support your favourite charities.

Over the last decade, the federal government has made several changes to the Income Tax Act to encourage charitable giving.

• Eliminated the capital gains inclusion rate on appreciated stocks, bonds, mutual fund shares and other public securities donated to a charity.

• Increased the maximum annual amount of individual donations to 75% of net income (from 25%). This allows individuals to donate up to 100% of net income in the year of death and the year immediately preceding death.




Who do I contact if I have questions?

CHAPTER 6

• Your financial or tax advisor for answers to questions regarding your personal tax situation.

• Your local taxation office to obtain tax forms and for questions regarding your personal tax situation. (For the telephone number, please refer to your personal tax return of last year or the government section of your local telephone book). Tax forms can also be obtained from Canada Revenue Agency’s website cra-arc.gc.ca and Revenu Québec’s website revenu.gouv.qc.ca.

• Call Mackenzie Investments Client Relations at 1-800-387-0614 (or in the Toronto area at 416-922-3217) for questions regarding your tax receipts.



Appendix: The Forms

Quick Facts For Investors

RRSP contribution deadline for 2013 is March 3, 2014Tax filing deadline is April 30, 2014

2013 18% of earned income to a maximum of... $22,970



Interest/foreign dividends Capital gains

Ineligible Canadian dividends

Eligible Canadian dividends

Alberta 39.0% 19.5% 27.7% 19.3%

British Columbia 43.7% 21.9% 33.7% 25.8%

Manitoba 46.4% 23.2% 39.1% 32.3%

New Brunswick 45.1% 22.5% 33.1% 24.9%

Newfoundland and Labrador 42.3% 21.2% 30.0% 22.5%

Northwest Territories 43.1% 21.5% 29.6% 22.8%

Nova Scotia 50.0% 25.0% 36.2% 36.1%

Nunavut 40.5% 20.3% 29.0% 27.6%

Ontario 46.4% 23.2% 32.6% 29.5%

Prince Edward Island 47.4% 23.7% 41.2% 28.7%

Quebec 50.0% 25.0% 38.5% 35.2%

Saskatchewan 44.0% 22.0% 33.3% 24.8%

Yukon 42.4% 21.2% 30.4% 15.9%

Important Dates

RRSP contribution limits

2013 top marginal tax rates (Federal and Provincial combined)



Québec All other provinces/territories

Up to $5,000 21.00% 10.00%

$5,001 – $15,000 26.00% 20.00%

Over $15,000 31.00% 30.00%

Up to $43,561 15.0%

$43,561 to $87,123 22.0%

$87,123 to $135,054 26.0%

Over $135,054 29.0%

Age Withdrawal Age Withdrawal Age Withdrawal

65 4.00% 77 8.15% 89 12.71%

66 4.17% 78 8.33% 90 13.62%

67 4.35% 79 8.53% 91 14.73%

68 4.55% 80 8.75% 92 16.12%

69 4.76% 81 8.99% 93 17.92%

70 5.00% 82 9.27% 94 20.00%

71 7.38% 83 9.58% 95 20.00%

72 7.48% 84 9.93% 96 20.00%

73 7.59% 85 10.33% 97 20.00%

74 7.71% 86 10.79% 98 20.00%

75 7.85% 87 11.33% 99 20.00%

76 7.99% 88 11.96% 100 20.00%

2013 Federal income tax rates

Withholding tax rates for RRSP/RRIF withdrawals 2013

RRIF minimum withdrawals

APPENDIX: THE FORMS



1. Where do I report T3 distributions (RL16 for Québec) on my tax return?

The following example shows how and where to report your mutual fund trust distribution on your tax return.

* Eligible taxable dividends are grossed up by 41%. Non-eligible dividends are grossed up by 25%. **This is the gross amount of the foreign non-business income earned of $16.36 less foreign withholding tax of $2.42.

Fund A Fund B Total

Capital gains $21.21 – $21.21

Dividend income* $123.66 $150.28 $273.94

Foreign non-business income (net**) $13.94 – $13.94

Other income $476.29 $137.04 $613.33

Return of capital $57.08 $20.50 $77.58

Total $692.18 $307.82 $1,000.00

Suppose you receive a total of $1,000 in distributions from two funds as follows:



• You will receive a consolidated T3 (RL16 for Québec) tax slip with a detailed breakdown of the distributions by fund on the back of the slip.

• On your 2013 income tax return, you would report the amounts shown on the front of the T3 slip as indicated on the following chart.

If you are missing any required schedule, please contact your local Canada Revenue Agency office to obtain the required information or online at cra-arc.gc.ca

T3 slip Box Description Report on this line of your tax return

Box 21 Capital gains Line 176 of Schedule 3 – Capital Gains (or Losses)

Box 25 Foreign non-business income Line 121 and on line 433 of Form T2209

Box 26 Other income Line 130

Box 34 Foreign non-business income tax paid Line 431 of Form T2209 and line 405 of Schedule 1

Box 42 Amount resulting in cost base adjustment $77.58 is not reported on your income tax return

Box 23 Actual amount of dividends other than eligible dividends

Dividends from Canadian corporations The amounts you have to report as income are the amounts shown in box 32 and box 50. Include the total of these amounts on line 120 of your return. The federal dividend tax credit to which you are entitled is the total of box 39 and box 51. Include this amount on line 425 of Schedule 1

Box 32 Taxable amount of dividends other than eligible dividends (This amount is 125% of the amount reported in Box 23)

Box 39 Dividend tax credit for dividends other than eligible dividends (This amount is 13.33% of the amount reported in Box 32)

Box 49 Actual amount of eligible dividends

Box 50 Taxable amount of eligible dividends (This amount is 141% of the amount reported in Box 49)

Box 51 Dividend tax credit for eligible dividends (This amount is 16.44% of the amount reported in Box 50)

APPENDIX: THE FORMS



Residents of QuébecOn your 2013 Québec income tax return, you would report the amounts shown on the front of the Relevé 16 slip as indicated on the following chart.

If you are missing any required schedule, please contact your local Ministère du Revenu du Québec to obtain the required information or online at revenu.gouv.qc.ca

Relevé 16 slip Box Description Report on this line of your tax return

Box A Gains en capital (Capital gains) Line 22 in Schedule G

Box F Revenus étrangers non tirés d’une entreprise (Foreign non-business income)

Line 130

Box G Autres revenus (Other income) Line 130

Box C1 Montant réel des dividendes déterminés (Actual amount of eligible dividends) Dividends from Canadian corporations

Carry the total of the amounts entered in boxes C1 and C2 to lines 166 and 167 of your return Box C2 Montant réel des dividendes ordinaires

(Actual amount of ordinary dividends)

Box I Montant imposable des div. déterminés et ordinaires (Taxable amount of eligible and ordinary dividends) This amount is 141% of the amount reported in Box C1 and 125% of the amount reported in Box C2

Line 128

Box J Crédit d’impôt pour dividendes (Dividend tax credit) Enter the dividend tax credit to which the beneficiary is entitled. You must first calculate the dividend tax credits separately according to the following formulas: • amount in box C1 x 16.779% (for eligible dividends); • amount in box C2 x 10% (for ordinary dividends)

Line 415

Box L Impôt étranger sur des revenus non tirés d’une entreprise (Foreign income tax on non-business income)

This amount gives entitlement to the foreign tax credit with regard to non-business income. Complete form TP-772-V, Foreign Tax Credit.

Box M Rajust. du prix de base d’une participation (Cost base adjustment of capital interest)

$77.58 is not reported on your income tax return


2. Where do I report T5 distributions (RL3 for Québec) on my tax return?

You will receive a consolidated T5 (RL3 for Québec) tax slip with a detailed breakdown of the distribution on the back of the slip.

On your 2013 income tax return, you would report the amounts shown on the front of the T5 slip as indicated on the following chart.


Dividend income* Capital gains

$500 $250

Total $750

T5 slip Box Description Report on this line of your tax return

Box 10 Actual amount of dividends other than eligible dividends Dividends from Canadian corporations other than eligible dividends – The amount that is reported as income is the amount shown in Box 11. The dividend tax credit to which an individual is entitled is shown in Box 12. For more information, see lines 120 and 425 in your income tax return.

Box 11 Taxable amount of dividends other than eligible dividends (This amount is 125% of the amount reported in Box 10)

Box 12 Dividend tax credit for dividends other than eligible dividends (This amount is 13.33% of the amount reported in Box 11)

Box 18 Capital gains dividends Line 174 of Schedule 3, Capital Gains (or Losses)

Box 24 Actual amount of eligible dividendsEligible dividends from Canadian corporations – The amount that is reported as income is the amount shown in Box 25. The dividend tax credit to which an individual is entitled is shown in Box 26. For more information, see lines 120 and 425 in your income tax return.

Box 25 Taxable amount of eligible dividends (This amount is 141% of the amount reported in Box 24)

Box 26 Dividend tax credit for eligible dividends (This amount is 16.44% of the amount reported in Box 25)

* Eligible taxable dividends are grossed up by 41%. Mutual funds pay eligible dividends.

Suppose you receive $750 in distributions from one fund as follows:

APPENDIX: THE FORMS



On your 2013 Québec income tax return, you would report the amounts shown on the front of the Relevé 3 slip as indicated on the following chart.

3. Where do I report RRSP contributions on my tax return?Suppose you contributed $2,000 to your RRSP on November 1, 2013. You will receive a contribution receipt.

On your 2013 income tax return, report the $2,000 contribution on line 2 of Schedule 7 “March 1, 2013 to December 31, 2013” or line 3 for “January 1, 2014 to March 1, 2014”. (On your 2013 Québec tax return, report the $2,000 contribution on line 214).

4. Where do I report withdrawals from my RRSP on my tax return?Suppose you withdrew $5,000 from your RRSP in 2013 and tax of $500 was withheld. You would receive a T4RSP slip.

On your 2013 income tax return, report the amount shown in Box 22 “Withdrawal and commutation payments” on Line 129 on your income tax return. Report the amount of tax withheld shown in Box 30 “Income tax deducted” of Line 437 on your income tax return.

Rélevé 3 slip Box Description Report on this line of your tax return

Box A1 Montant réel des div. determinés (Actual amount of eligible dividends) Line 166

Box A2 Montant réel des div. ordinaires (Actual amount of ordinary dividends) Line 167

Box B Montant imposable des dividendes (Taxable amount of eligible and ordinary dividendes) This amount is 141% of the amount reported in Box A1 and 125% of the amount reported in Box A2

Line 128

Box C Crédit d’impôt pour dividendes (Dividend tax credit) This amount is 11.90% of Taxable amount of eligible dividends and 8% of Taxable amount of ordinary dividends

Line 415

Box I Dividendes sur les gains en capital (Capital gains dividends) Enter this amount in Schedule G



Residents of Québec Suppose you withdrew $5,000 from your RRSP in 2013 and tax of $1,050 was withheld. You will receive a T4RSP slip and a Relevé 2 slip.

Each slip provides the same information except that (for the federal tax of $250) the T4RSP slip shows the amount of federal tax that was withheld ($250) and remitted while the Relevé 2 slip shows the Québec tax withheld ($800) and remitted.

On your 2013 Québec income tax return, report the $5,000 shown in Box C “Autres paiements” on Line 154. Report the $800 of Québec tax withheld shown in Box J “Impôt du Québec retenu à la source” on Line 451 of your Québec tax return.

5. Where do I report withdrawals from my RRIF on my tax return? Suppose the minimum amount you were required to withdraw in 2013 was $23,550 and you withdrew $30,000 and tax of $645 was withheld. You will receive a T4RIF.

If you were 65 or older on December 31, 2013, you would report the $30,000 shown in Box 16 “Taxable amounts” on Line 115 “Other pensions or superannuation” on your income tax return. Otherwise, you would report the amount on Line 130 “Other income.” In either case, you would report the $645 of tax withheld shown in Box 28 “Income tax deducted” on Line 437 on your income tax return.

Residents of Québec Suppose the minimum amount you were required to withdraw in 2013 was $23,550 and you withdrew $30,000 and tax of $1,935 was withheld. You would receive T4RIF slip and a Relevé 2 slip.

Each slip provides the same information except that the T4RIF slip shows the amount of federal tax that was withheld ($645) and remitted while the Relevé 2 slip shows the Québec tax that was withheld ($1,032) and remitted.

On your 2013 Québec income tax return, report the $5,000 shown in Box C “Autres paiements” on Line 154. Report the $800 of Québec tax withheld shown in Box J “Impôt du Québec retenu à la source” on Line 451 of your Québec tax return.

APPENDIX: THE FORMS



6. Where do I report my capital gains and losses on my tax return? Capital gains or losses are reported on Schedule 3 – “Capital Gains (or Losses) in 2013” under “Publicly traded shares, mutual fund units, deferral of eligible small business corporation shares and other shares.”

Capital gains or losses are reported on Revenu Québec Schedule G in Part A titled “Capital Property” under the section titled “Shares and units in a mutual fund trust.”

No. of shares 300

Name of corporation Fund A

Year of acquisition 2006

Proceeds of disposition $5,400.00

Adjusted Cost Base $4,354.26

Outlays and expenses (from dispositions) $297.00

Capital Gain (or loss) $748.74

Capital Gain inclusion rate 2013 50%

Taxable Capital Gain $374.37

7. Where do I report my PFIC income?If you are a US person or green card holder, you are required to report your worldwide income in both Canada and the US. Your mutual fund income must be reported under US “Passive Foreign Investment Corporation” rules (“PFIC”). This information will differ from the information you receive on a Canadian T3, T5, NR4, Relevé 3 or Relevé 16. Ask your advisor for an “Annual Information Statement” from the fund company. The information recorded on your AIS will be recorded on US Schedule Form 8621 for each of your mutual fund investments and must be included with your US income tax return. This information is not required for your Canadian income tax filing.

Using the following example, the investor would report the capital gain as follows:



Commissions, trailing commissions, management fees and expenses all may be associated with mutual fund investments and the use of an asset allocation service. Please read the prospectus of the mutual funds in which investment may be made under the asset allocation service before investing. Mutual funds are not guaranteed, their values change frequently and past performance may not be repeated.

For Series T, please note that a return of capital reduces an investor’s adjusted cost base (ACB). Capital gains taxes are deferred until units are sold or until the ACB goes below zero. Investors should not confuse the cash flow distribution with a fund’s rate of return or yield. While investors in Series T will be able to defer some personal capital gains, they still must pay tax on capital gains distributions that arise from the sale of individual fund holdings by fund managers, and on interest and dividend distributions. If required, Series Twill also pay a distribution that must be reinvested in December, consisting of income and capital gains.

Mackenzie has developed the Mackenzie Charitable Giving Fund program with the Strategic Charitable Giving Foundation, a registered Canadian charity. In addition to mutual fund commissions, fees and expenses, program fees will also apply. Donations should not be made for tax considerations alone. Each donor’s situation is unique and advice should be received from a qualified advisor.

Call your advisor or visit mackenzieinvestments.com/diversifi ed

The use of the term or phrase “pension [or ‘institutional’] style investing” (“phrase”) should not be misconstrued as a claim of compliance with the Pension Benefi ts Standards Act of Canada. The phrase used in respect of Mackenzie Investments’ Symmetry Portfolios refers to its selective use of pools. Pools are simply separate accounts, or mandates, in which portfolio managers are provided with guidelines that complement other mandates within a larger long-term portfolio. In the case of Symmetry Portfolios, Mackenzie Asset Allocation Team asks portfolio managers to invest within specifi c guidelines exclusively for Symmetry Portfolios. Examples of Symmetry Portfolio guidelines may be: no cash held in a portfolio; Canadian equity securities only; utilize a consistent value bias and a threshold on market cap. Commissions, trailing commissions, management fees and expenses all may be associated with mutual fund investments and/or the use of an asset allocation service. Please read the prospectus before investing including the prospectus of any mutual funds that may be in an asset allocation service. Mutual funds are not guaranteed, their values change frequently and past performance may not be repeated. Take Control™ is a trademark of Mackenzie Investments.

Volatile and uncertain markets have driven many investors to the sidelines.

Get back on track with Symmetry Portfolios – a range of fully managed,

one-stop investment solutions to help keep you invested.

Offers choice across a range of seven diversifi ed portfolios

Adheres to strict risk-oversight practices to manage volatility

Provides ‘pension-style’ management for retail investors

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MARKET

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Symmetry Portfolios

Information in this guide is current to December 31, 2013 unless otherwise stated. The information contained herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavour to provide accurate and timely information, there can be no guarantee that such information is up to date as of the date it is received or that it will continue to be accurate in the future. No one should act upon such information without appropriate professional advice after a thorough examination of their particular situation.

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G E N E R A L I N Q U I R I E S

For all of your general inquiries and account information please call:

ENGLISH 1-800-387-0614 416-922-3217BILINGUAL 1-800-387-0615ASIAN INVESTOR SERVICES 1-888-465-1668

TTY 1-855-325-7030 416-922-4186FAX 1-866-766-6623 416-922-5660E-MAIL [email protected] mackenzieinvestments.com

Find fund and account information online through Mackenzie Investments’ secure InvestorAccess. Visit mackenzieinvestments.com for more information.

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