Q: Could you explain the difference between these two stocks. What are the dividends for each and are they paid out in US $ or CDN. Which has the better tax treatment, as I understand there is different tax treatments for partnerships. but not sure what the difference is?

Q: To receive US funds I have 23 shares of ABBV, 78 shares BIPC, 62 shares EMA and 74 haes of QSR in a US TFSA account with TD Webroker in Canada.
1. Since the witholding tax is not recoverable should I switch these holdings to a non-registered US account?
2. Though I like the US funds received as dividends, would it be more efficient to switch these to Canadian holdings for the tax credit and hold them in a non-registered Canadian account? please use as many credits as required.

Q: Hello 5i Team

Further to the reader’s question about US$ denominated dividend deposited into US$ denominated accounts at RBC Direct Investing.

I experienced the same issue with RBC Direct Investing and they explained as follows. I will use Brookfield Infrastructure
Partners (BIP) which I hold in a US$ denominated account.

BIP transfers the total dividend to Canadian Depositary for Securities (CDS) for all the BIP shares held by CDS (in excess of 100 million shares) on behalf of Canadian Brokers. This dividend payment (in US $) is converted to C$ (unclear whether its BIP or CDS) at “wholesale” rates.

CDS then transfers to each Canadian Broker (i.e. RBCDI) the Canadian dollar equivalent of BIP dividends held by the individual brokers (i.e. RBCDI). RBCDI then buys US dollars for dividends deposited into US$ denominated accounts. There is a difference in the exchange rate between the dividends received from CDS and the transfer to individual accounts. This results in the small discrepancy between dividends declared and dividends received.

The result is for 1,000 shares of BIP

BIP declared dividend = US$0.43 x 1,000 shares = US$430.00

RBCDI deposited $0.429544 x 1,000 shares = US$429.54 a difference of $0.46

Sometimes it works the other way and RBCDI deposits a slightly greater amount of US$ than the equivalent original dividend amount.

Other US $ stocks do not seem to have this issue, as I mostly hold US domiciled companies in my US $ accounts. It may also be a result of how the dividend issuing company transfers funds to CDS.

It is annoying as I originally purchased BIP on the NYSE and expected to receive the declared dividend amount.

I hope this explains the matter to the reader.