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WHAT IS A LABOUR SPONSORED INVESTMENT FUND?
A Labour Sponsored Investment Fund (LSIF) is an investment vehicle designed to attract RRSP investments to provide funding to small and medium-sized, 100% Canadian owned companies. Like conventional mutual funds, LSIF's are pools of capital collected from a large number of individual investors, directed by professional money managers. Because your are investing in home-grown companies, both the federal and provincial governments typically offer an tax credits, totaling 30% of the investment. These tax incentives make LSIF's a very attractive option for individuals seeking to invest (can save up to 70 cents per dollar invested, depending on your taxable income).
FEDERATION'S ROLE IN LSIF
The Federation's key interest lies in the potential of such an initiative to contribute to the economy of Newfoundland and Labrador by providing equity capital to small and medium sized business in strategic growth sectors. Businesses in the start-up phase traditionally have difficulty securing access to the levels of capital necessary to ensure growth and development. These companies create employment and wealth while contributing to the innovative capacity of our Province. Labour Sponsored Investment Funds provides a means for workers in our Province to contribute to the economic and social development of the Province.
The sponsorship and active participation in the operations of a fund by the trade union movement immediately provides credibility and establishes an immediate pool of potential investors. This is what labour organizations, like the NLFL can bring to such initiatives. The Newfoundland and Labrador Federation of Labour is committed to the growth and development of our Province and views Labour Sponsor Investment Funds as a tool that can help encourage that growth.
The Newfoundland and Labrador Federation of Labour is committed to growth in our Province. This has been clearly demonstrated by the level of facilitation and research into LSIF the Federation has conducted to determine the viability, need, and level of reception amongst various levels of government, the private sector, and the membership of the Federation. In the upcoming months, the Federation will work to increase awareness of this opportunity through all affiliates and unions throughout the Province.
WHAT ARE THE BENEFITS
Labour sponsored investment funds provide benefits on two distinct levels. The first is to the individual investor. LSIF's offer unique investment opportunities and tax credits to individual investors which include:
- An opportunity to invest in emerging Newfoundland and Labrador companies involved in the growth of strategic sectors in the provincial economy;
- An opportunity to receive tax deductions and credits not offered by traditional RRSP contributions; and
- An opportunity to participate in and contribute to the growth of the provincial economy.
There are also unique advantages which accrue from LSIF's that benefit the economy at large. They include:
- It helps in the growth and development of small and medium sized businesses it provides another source of capital to facilitate job creation, growth and development;
- It keeps some of our investment dollars in our Province, helping grow are economy!
NEW FUND ANNONCED FOR NEWFOUNDLAND AND LABRADOR!
- New Initiate helps keep our investment dollars in Province
The first and only Labour Sponsored Fund for Newfoundland and Labrador was announced in January 2005 and is called the GrowthWorks Atlantic Venture Fund. The Newfoundland and Labrador Federation of Labour played an integral role in its development. The Fund operates within the four Atlantic Provinces, however monies invested from any individual province must be re-invested back into that province. Workers in Newfoundland and Labrador can now invest some of their RRSP monies in our Province, receive great tax incentives, and truly makes their money work for them!
KEY ELEMENTS
- Investments are RRSP eligible which means tax savings for you!
- Additional tax credits paid on annual investments (credits on a maximum of $5,000 annually):
- 15% tax credit from Federal Government (maximum annual credit. $750);
- 15% tax credit from Provincial Government (maximum annual credit. $750);
- Can transfer monies from an existing RRSP portfolio into this fund and still receive tax credits;
- Investment is locked for minimum of 8 years;
- The fund targets strategic growth sectors of the economy;
- Investments will be combined for a diversified portfolio of local and Atlantic Canadian firms;
- Funds raised in Newfoundland and Labrador will be re-invested in Newfoundland and Labrador firms!
For more information on GrowthWorks and the Atlantic Venture Fund visit the GrowthWorks
website at: www.growthworks.ca
HOW TO INVEST?
Contact an Investment Advisor today. Ask about the GrowthWorks Atlantic Venture Fund and its benefits!
CONTACT AT THE FEDERATION
The NLFL would welcome the opportunity to make a presentation to your membership, executive or local Council. If you should have any questions or would like to schedule a meeting to find out more about the GrowthWorks Atlantic Venture Fund, call today!
As with any investment opportunity, it's important for you to be fully informed before you make any decisions. The Federation will be working closely with GrowthWorks Atlantic to ensure that investors understand the full range of benefits you get when purchasing GrowthWorks Atlantic Venture Fund for your RRSP. We have recently hired Kirk Youden as a liaison for the Newfoundland and Labrador Federation of Labour to ensure the Labour movement in our Province is well informed of this opportunity.
Kirk Youden
Labour Sponsored Venture Capital Liaison Officer
330 Portugal Cove Place
NAPE Building
P.O. Box 8597, Station A
St. John's, NL A1B 3P2
Phone (709) 754-1660
Fax (709) 754-1220
E-mail: kyouden@nlfl.nf.ca
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