Investment Q&A

Q: If you own (cost basis) over $100,000 (I believe) of foreign stock, you need to fill out a T1135 form. My question is, if you owned EFTs for foreign companies, and purchased those EFTs on a Canadian market, will those EFTs need to be included on the T1135?

I know this is a tax question, but I hope it has an easy answer. Thanks.

Q: How does RETURN OF CAPITAL affect ones annual Canadian tax return and does one have to keep track of them over longer periods of time? Thanks

Q: Tax question if you allow ( I acknowledge you are not tax advisors and that I am solely responsible). CRA form T1135 includes a column showing realized gain (loss) in Canadian $. The amounts I calculate after adjusting for purchases and sales made at different dates and after adjusting for commissions charged by brokers for Forex conversions , I arrive at a lower realized gain. The difference is not really for the “Outlays and Expenses” box in the T5008 in TurboTax software. Does it matter that I have a lower capital gain than the amounts shown in the T1135 ? Or do I need to report the exact amounts shown in the T1135? Thanks.

Q: I just read that you are saying there is a 10% tax on the sale of limited partnership shares. Is that only for US LPs? Or are you saying that when I sell my bip.un shares, that i will have to pay a 10% tax on the proceeds, independent of whether there is a gain or loss from the sale?

Q: Are those funds advantageous to hold in a rsp account regarding on the withholding of US dividends? I am never sure if those dividends get charged fo all holders, or just the cash accounts. So if these do not shelter the rsp from the tax, which equivalent would you suggest.?
Thank you

Q: I hold Veren at a loss in a non registered account...will I lose the the capital loss if I wait for the take over by Whitecap ? Jim

Q: Is the interest subject to withholding tax on the US side? (held in TFSA)

Q: Is there any withholding tax on an ETF like VGG in a TFSA when you sell it?

Q: Hovering around high $140s and into $150s, what would be a good entry for Terravest? thank you

Q: As they have moved to U.S. is there now a withholding tax on their dividends?

Q: On August 16 last year, High Arctic split the company into two entities (HOH and new HWO). For each share of HWO held, shareholders received one-quarter of a common share of HOH and one-quarter of a common share of post-Arrangement HWO.

I haven’t been able to determine how to apportion my original cost between the two. My RBC statement shows that they (RBC) attributed 100% of my existing cost to the new HWO but they attributed an addition $0.50 per share to HOH.

They have a generic footnote that says (re: HOH) “Part of or all of the Book Cost on this security position is unknown resulting in the use of market value… Please contact us to update the statement records.”

I would like to do that, but I don’t know what the amount should be.

On their website, HWO says,
“High Arctic Energy Services Inc. has determined that the fair market value [HOH] shares ... on August 12, 2024 is $1.755 per High Arctic Overseas Holdings Corp. common share”.

Does that mean I should (or could) use $1.755 as my cost per share of HOH, and deduct in from my cost per share of HWO? Other suggestion?

Thanks,

Q: Are these dividends eligible for the dividend tax credit even though the fund is largely composed of US preferreds.

Thank you

Q: Hi,

I was surprised to learn yesterday that a T3 form was provided to me from by bank for holding Purpose High Interest Savings Fund (PSA). It says there is a minuscule return of capital. I thought PSA would only provide interest as reported on a T5.

I went to the PSA website and sure enough, there is a ROC and has been since 2013. Do you know if this is typical of these high interest savings account ETFs and if there is another fund that is similar to PSA without the ROC component?

Thank you.
Michael

Q: Hello. I was going to ask you about MSTY:US, one of YieldMax ETFs. It creates synthetic long exposure, then writes covered calls to generate income. I specifically wanted to ask you about how distributions would be treated from a tax perspective as a Canadian. The distributions are options premiums. So would the distributions then be treated as capital gains, or as US dividends? I assume there would also be a 15% US withholding tax.

When I entered the symbol to ask this question, I discovered that MSTY:CA is a Canadian equivalent, although they only have 50% exposure. Do you know anything about the company Harvest? I had never heard of them. Are they an established and reputable company? How would distributions from MSTY:CA be treated from a tax perspective? Thanks for your help

Q: Thinking about Martin’s question ( March 19) and your response, specifically on ROC. I own UMAX in a RRIF. I Look at its 14% yield as more than enough to cover the approximately 6% ( and rising) mandatory withdrawal, thus not negatively affecting my cash flow. I also see the ROC as lowering my unit price and thus the mandatory withdrawal amount. Is my thinking right on this ? Thanks. Derek.

Q: Hello 5i Team
If I own shares of BRK CDR of greater then $100,000 in my RRIF account do I need to fill the T1135 form?
Thanks

Q: Hello, looking at UMAX, the price went from 16$ to 14$ in less than 2 years. Is it because the NAV is going down because of the dynamics of covered calls? Sould we expect a steady price erosion for the foreseeable future? It’s nice to have 13+% annual distribution but if we have a corresponding capital loss, I am not sure it makes sense. Can this ever be a long term hold? Thanks.

Q: What are the tax implications for Canadian investors relative to AGNC. I believe they are an investment trust. It is my understanding that all USA based trusts have negative tax consequences, such as 30% withholding tax and 10% tax on all proceeds of any sale of shares. Not protected in RRSP accounts. Is my information correct.

Q: Hi, I enquired earlier about the double whammy of withholding taxes on some Chinese etf like FXI. Are there any CHINA broad etfs that don't have to pay this double tax?

If not, are there any other options? Are there CDN etfs that dont pay the double tax?

Q: Hi,

I’m following up on recent questions about taxation of the ETF VEQT (and similar) in an RRSP.

I am a bit confused about what withholding taxes might apply to VEQT. I have three questions please.

1) Would you be so kind at to explain what withholding taxes apply to VEQT in an RRSP?

2) If there are non-recoverable withholding taxes on VEQT in an RRSP, can they be quantified?

3) Finally, if there are withholding taxes applicable to VEQT in an RRSP, is there an ETF setup with the same diversification objective as VEQT that is more tax efficient in an RRSP?

(I tried following this information but I’m still unclear: https://www.vanguard.ca/content/dam/intl/americas/canada/en/documents/WithholdingTax_Guide-final.pdf).

Thank you very much.

Michael