Apex Mutual Fund has been structured to avoid taxation by distributing any net interest, dividends, and capital gains to unitholders each calendar year. This is an example of what type of mutual fund structure?
A mutual fund trust structure allows the fund to avoid taxation by distributing its income to unitholders. The feedback from the document states:
"The most common structure for mutual funds in Canada is the open-end trust. The trust structure allows a fund itself to avoid taxation. Any interest, dividends and capital gains income, net of the fund’s fees, expenses and capital losses, if passed to its unitholders each calendar year, will allow the trust to avoid being taxed on its income."
[Reference: Chapter 10 – The Modern Mutual FundLearning Domain: The Modern Mutual Fund, , , ]
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