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Dream Industrial Real Estate Investment Trust (DIR.UN $12.33)
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iShares Core MSCI Canadian Quality Dividend Index ETF (XDIV $35.14)
Q: Can you tell me which of these 2 would be best in a TFSA vs a regular account for tax purposes?
thank you
thank you
5i Research Answer:
These are quite different, one being a diversified ETF and the other being a REIT. REITs have various types of income, including a return of capital component. This can be an advantage to investors in a non-registered account, as it shifts part of the tax burden to capital gains (from income). But with XDIV, Canadians get the dividend tax credit, which is not useable in a TFSA. For most investors, then, a non-reg account is probably best for both. However, with XDIV likely to see more growth over time, if forced to choose between the two we would put into the TFSA for growth and to maximize tax free growth in that account.