Investment Q&A

Q: Just to confirm please if dividends of Canadian companies listed on TMX and US - NYSE have a favourable tax treatment in Canada?
Do the dividends face US tax when flowing from US listing?
Thank you
Miroslaw

Q: Question regarding investing in a US dollar TFSA. Are returns taxable in any way? And if so are these deduction at source before generating into the tfsa? If there are consequences, what is best inside the US tfsa, dividends or capital gains. Deduct as needed

Q: My understanding (misunderstanding?) is that MLPs are subject to very high withholding taxes when held by Canadians. From some comments on MLPs I've seen in the past, I had the impresssion that its not always possible to determine the cost of the fees.
1. Does the fact that AMZA is an ETF of MLPs (rather than an MLP itself) change any of this?
2. Is the withholding a fixed percent of the distribution or does it vary based on the make up of the distribution?
3. Is there an account type that would be better or worse to hold this ETF?

Thanks,

Q: Hi, I realize you are not tax experts but wonder if you could help. I sold short XSP ETF in 2020 and have some net realized losses to report. I have heard that CRA requires G/Ls on short sale as income not realized gains. Is this correct and on what line of my return would I report it. Thanks.

Q: In answer to Bruce on Jan 7 you said:
In an RRSP, we would prefer to hold US-listed ETFs due to withholding taxes on US dividends being exempt (not the case with CDN-listed ETFs).

This would mean that ZWK/CALL is not as efficient as it could be. Is there an equivalent US listed ETF that you would recommend? I am looking for an ETF that would let me drip the dividends. From your other answers I believe this type of ETF would be good in 2021: flat or slowly rising market.

Q: A few questions re best index ETFs for safety, total return and tax efficiency:
(1) S&P/TSX 60 (unregistered account): Is XIU, XIC or another ETF better?
(2) S&P 500 (RRSP/TFSA): What CAN listed ETF is best for long hold: ZSP, XSP or other ETF? If held in an RRSP (ie US dividend tax except), can you recommend the best US listed ETF for the S&P 500?
(3) NASDAQ 100 (RRSP/TFSA): What CAN listed ETF is best: ZNQ, ZQQ or another ETF? Is QQQ the best US listed?
(4) Ex-North America index (RRSP): Can you list the best CAN listed ETF index fund? Would you stick with large caps or all? XEF? VIU?
(5) Emerging market index ETFs (RRSP): ZEM, VEE or other?
(6) MISC: Has HXT, HXS and HXQ permanently resolved gov't issues and are these ETFs safe for long term hold?
Thank you!!

Q: Thanks for all your good advice.
I have set up In Trust Accounts for my grandchildren invested equally in HXS and HXT - to avoid tax implications to me. However, due to the swap change introduced Nov 2019 and effective in 2020 - I have been issued T5008 slips seemingly indicating capital gains as a result of the swaps. Is this just for record purposes or is there a need to account for this at tax time?
Thanks

Q: I want to hold IWO and SPY etf's, I am a canadian resident.
Are there any tax, exchange rate implications for me in holding these ( or any other US stocks )?

If yes, then suggest a equivalent Canadian ETF.

Q: in TFSA account, what is the tax implication if buying Canadian listed EFT investing in US listed stocks? is there any witholding tax ?

Q: Hi Team,
Previously (I believe it was sometime in 2020) in your answer to questions on US estate tax payable by Canadians, it was pointed out that the threshold for US estate tax is US$11.2M (to be reduced to US$4 or 5M in 2023?), meaning no US estate tax is payable if value of world-wide assets is under US$11.2M. Amounts in excess of this threshold is subject to US estate tax with some credits allowed as per the Canada-US tax treaty.
Please confirm if your previous statement regarding US estate tax is still applicable.
Cheers,

Q: On Wednesday Gary asked a question about estate taxes on U.S. property/stocks. I'm wondering whether stocks of Canadian dual-listed companies that are held on the U.S. side of an account, or foreign ADRs held in the U.S. account are also considered U.S. property for estate purposes and/or for CRA form 1135.

Q: Hi held this stock for many years and it is not subject to us withholding tax as it is a Canadian domiciled company
Stan

Q: Just to confirm my impression about tax treatment of dividend flowing from Canadian based EFTs with US and International focus.
Outside TFSA and RRSP these are treated as income rather then tax favourable dividends?
Canadian focused EFTs dividends are treated as dividends from Canadian stocks?
Thank you,
Miroslaw

Q: Hi gang,

I realize that Topicus shares issued to CSU holders are treated as a dividend, but I'm having a hard time finding a book value of these shares, ie dividend value.

Do you know what we should use for this book value?

Thx

Q: My question has to do with personal estate taxes or the tax grab by the us tax authorities on a individuals estate holding personal US property (US stocks). Can one avoid this problem by just simply holding Canadian ETF's (trading only in Canada) that hold US equities. For example BMO ZQQ, or Vanguard VSP. Any guidance or help from 5i or it's members would be much appreciated.

Q: Hi Peter...More of a comment than a question...RBC Direct shows the book cost of our new TOI shares as $0.01 even though they also acknowledge that the stock opened at $66 per share. A book cost of $0.01 suggests a sizeable capital gain. I have spoken to RBC Direct but so far the book cost has not changed. I was thinking of transferring my TOI Margin account shares to my TFSA account where I also hold TOI shares as a contribution in-kind. However I don't want to trigger a big capital gain and then fight with RBC to get it corrected later. It's early days so I will monitor the share status and hopefully RBC will get it corrected. I suppose CRA will have the final say on wether the TOI shares are a dividend or not.
Jim

Q: Now that TOI has started trading and I own it in my non-registered account, would it be best to sell and repurchase 30 days later? Would I now be taxed on any and all cash with this stock when I sell?

Q: Are my Topicus sharea considered to be a dividend for tax purposes, or do they have a cost base of zero for tax purposes ?

Q: For ACB calculations:
Must include all non registered accounts ?
Must also include registered and TFSA accounts ??
Must also include my wife’s accounts ???
I am not sure about the last 2 scenarios.

Many thanks.

Q: Janet Yellen - Federal Reserve - talking about taxing unrealized capital gains - year after year even if you have not sold. Your opinion on this. Now that everyone including young people I know are getting information through Reddit and buying all these risky plays, i.e. Koss, and Gamestop are making a lot of money for new people in the market. Will there be enough to go around for people who just want to buy safe stocks and hold on to them for a period of time? Most of my stocks in this area have gone a fair amount over the past while, whereas these highly promoted risky and shorted stocks - seemed to be skyrocketing and more money will gravitate to them. Your opinion on that?