The Smith Manoeuvre - Making Canadian Mortgage Interest Income Tax deductible.

QUESTION: The Smith Manoeuvre

Can you tell me about it or do you have some information of it, how it works
and what it does to save me taxes?

david ingram replies:

In October 1976, I wrote a newsletter for the Annual Report of the North
shore Credit Union. They published it in the North Shore News and to my
knowledge, that was the first dissertation on making the interest on a
Canadian Mortgage deductible. I proved (to my satisfaction) that it was so
easy to do that I believe that I was largely responsible for the
Conservative Government of Joe Clark's putting a 4 page section in the 1979
Canadian Income Tax return. The 4 page section was the directions on how to
calculate your mortgage interest as a deduction on your 1979 return.

Unfortunately, Joe Clark could not count the number of SOCREDS who were in
the house on Dec 11th or 12th (I think that was the date) 1979 and his
government fell in a non-confidence motion (there was also a no-confidence
motion tabled today (Thursday Nov 15th 2005) by Stephen Harper.

The electorate didn't get it and elected Trudeau again and the Liberals
cancelled the deduction even though it was on the tax return.

I published it then in My Investment Guide in 1979, 1980 and 1981. Four
Years later Fraser Smith published the Smith Manoeuvre which was a manual
for how to go to VANCITY Savings Credit Union and make your mortgage

This past June I phoned 8 branches of VANCITY and not one of them knew what
I was talking about. I then phoned Fraser Smith and asked him and he told
me that the VANCITY on Austin Road in Coquitlam knew how to do it. And,
three weeks ago, one of the attendees at our Thursday night seminars had
dealt with that branch and his mortgage was deductible. At this time, Glen
Kelleway ( can set up your mortgage to be
deductible and Stu Rodger from Manulife Bank is at all our Thursday Night
Seminars and he can help you as well.

It is easy to do. Telling you how here would require rewriting the book
which I am doing now and will publish soon as the "CEN-TA CLAUSE".

In the meantime, you can go to and read the November 2001
newsletter (top left hand box). This is about the fifth rewrite of the
original newsletter. If that is not enough, get hold of the Smith Manoeuvre
and read the book. It is only about $25.00 or less.


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