When a Canadian has $14,000 in capital gains, their tax liability is calculated as: $14,000 * 50% * marginal tax rate. The 50% is basically the Canadian way of

When a Canadian has $14,000 in capital gains, their tax liability is calculated as: $14,000 * 50% * marginal tax rate. The 50% is basically the Canadian way of taxing capital gains lower than earned income. What GP was trying to convey, albeit in a slightly confusing fashion, was this: 1. He had $14,000 in capital gains 2. No tax was directly accessed against this $14,000 amount, in other word: "tax bill was ~0 on the $14K". 3. The taxable portion of his capital gains was $14,000 * 50% = $7000 4. He paid his marginal tax rate on the taxable portion of his capital gains ($7000)