|
I don’t think it makes a difference. You’ll see the withholding tax on your statement if you own the US ETF, but I’m pretty sure it’s hidden away in the CAD ETF, but it’s still there. But withholding taxes make up a tiny drag on your return anyway, it’s seriously almost never worth losing sleep over.
|
#
?
Aug 27, 2021 09:15
|
|
|
|
| # ? May 17, 2024 15:11 |
|
|
pokeyman posted:Ah, I misunderstood. According to this the amount withheld is recorded on a t5 and you can get it back as a tax credit when you file your return. https://canadiancouchpotato.com/2012/09/17/foreign-withholding-tax-explained/
|
|
#
?
Aug 27, 2021 09:35
|
|
|
I had the CRA deny the deduction of some US withholding because I didn’t file a US return, but they reversed that opinion and permitted the deduction on appeal so other than the cost of a few hours of accountant time it all turned out OK. For US income you can file a W8-BEN as a foreign beneficiary to avoid the withholding at all and then it’s all taxed in your hands in Canada like anything else.
|
|
#
?
Aug 27, 2021 12:03
|
|
|
qhat posted:I don’t think it makes a difference. You’ll see the withholding tax on your statement if you own the US ETF, but I’m pretty sure it’s hidden away in the CAD ETF, but it’s still there. But withholding taxes make up a tiny drag on your return anyway, it’s seriously almost never worth losing sleep over. Not losing sleep, but as my portfolio grows and the mechanics become habit, it looks increasingly worthwhile. Mantle posted:According to this the amount withheld is recorded on a t5 and you can get it back as a tax credit when you file your return. Thanks! Was looking at the wrong explainer. Subjunctive posted:I had the CRA deny the deduction of some US withholding because I didn’t file a US return, but they reversed that opinion and permitted the deduction on appeal so other than the cost of a few hours of accountant time it all turned out OK. This is the kinda stuff that makes it seem less worthwhile. But I'm in no rush so maybe someday.
|
|
#
?
Aug 27, 2021 16:43
|
|
|
I think the only thing of concern about withholding tax is when you own an ETF like XAW which basically wraps US ETFs that invest in ex-USA securities. There’s a double taxation, one on dividends paid to the fund from foreign securities (the withholding tax is reciprocated), and then again on dividends paid to you the Canadian shareholder. The only way to get around that is to hold a Canadian ETF (like VIU) that holds ex-NA securities directly, and then hold a US total market fund separately.
qhat fucked around with this message at 17:16 on Aug 27, 2021 |
|
#
?
Aug 27, 2021 17:14
|
|
|
https://www.investmentexecutive.com/news/industry-news/liberals-promise-new-tax-sheltered-account-for-downpayment-savings/ "The First Home Savings Account would allow Canadians under 40 to set aside up to $40,000 toward the purchase of a first home, with no tax on contributions or withdrawals. Contributions to the account would be deducted from income, as with an RRSP, and remain tax-sheltered until withdrawn tax-free as with a TFSA, up to a maximum of $40,000. If funds held in the account weren’t used for a home purchase by the age of 40, they would convert to normal RRSP savings, the Liberals proposed." This seems totally useless for actually being able to get an affordable home, but it does seem like a supercharged tfsa+rrsp? Should I hold off on my rrsp and tfsa contributions and wait to see if this comes into effect?
|
|
#
?
Aug 27, 2021 18:57
|
|
|
Lol, "Should I wait to see if the Liberals keep an election promise?" Hahaha, that's loving funny!
|
|
#
?
Aug 27, 2021 19:07
|
|
|
It's a bullshit way for liberals to funnel money into housing. If they really gave a poo poo about saving people money on taxes they would tack that amount onto everyone's TFSA rooms, but they won't do that because they actually want the tax money to go to homeowners.
|
|
#
?
Aug 27, 2021 19:15
|
|
|
mila kunis posted:Should I hold off on my rrsp and tfsa contributions and wait to see if this comes into effect? In addition to the correct take above re: election promises, who knows what the implementation will look like and when it'll happen. If you have TFSA room, I would keep using that for now as it's easiest to withdraw.
|
|
#
?
Aug 27, 2021 19:15
|
|
|
Yeah I mean I don't trust them either but I have a limited amount of money to go around. I guess I could hold off on the RRSP contributions but put some into my TFSA. Speaking of the TFSA, my CRA account doesn't seem to show my contibutions over the last 2 years and show a much higher contribution room than it should. It's a little annoying because I have to double check my contributions to my TFSA accounts and subtract by hand, is there a way to directly link my TFSA accounts to the CRA so it actually tracks it?
|
|
#
?
Aug 27, 2021 21:33
|
|
|
mila kunis posted:Yeah I mean I don't trust them either but I have a limited amount of money to go around. I guess I could hold off on the RRSP contributions but put some into my TFSA. Not that I know of, this stuff is pretty frustrating as the information on CRA isn't nearly as reliable or updated as often as it should be. I've always kept a separate ledger to keep track manually.
|
|
#
?
Aug 27, 2021 21:40
|
|
|
mila kunis posted:Yeah I mean I don't trust them either but I have a limited amount of money to go around. I guess I could hold off on the RRSP contributions but put some into my TFSA. It should show up eventually on the CRA site without your doing anything, and it should also appear on your notice of assessment. Might be worth a call to CRA if the site hasn't updated for a couple years, they're pretty helpful. Ultimately it's up to you to avoid over-contribution, so you should always keep track yourself. But it is nice to be able to confirm that you got the same number as CRA.
|
|
#
?
Aug 27, 2021 21:59
|
|
|
Also, have a look at the Home Buyer's Plan, it lets you raid your RRSP for a down payment. If you're below its maximum, might as well contribute while you wait for whatever future account types may appear.
|
|
#
?
Aug 27, 2021 22:01
|
|
|
qhat posted:It's a bullshit way for liberals to funnel money into housing. If they really gave a poo poo about saving people money on taxes they would tack that amount onto everyone's TFSA rooms, but they won't do that because they actually want the tax money to go to homeowners. they’d raise the basic amount at least to the poverty line. plenty of people don’t make enough to use the TFSA.
|
|
#
?
Aug 28, 2021 01:00
|
|
|
mila kunis posted:If funds held in the account weren’t used for a home purchase by the age of 40, they would convert to normal RRSP savings, the Liberals proposed." So, I'm curious how this would work in practice if implemented. Would it "convert" into an RRSP by using up equivalent RRSP contribution room when you hit 41? If so, then it's boring. Or would it "convert" by just changing whatever you contributed into it into a regular RRSP account, but not affecting your existing RRSP contributions? If so, then you should theoretically always prioritize this account over others before age 41 to gain "free" room.
|
|
#
?
Aug 28, 2021 23:19
|
|
|
AegisP posted:So, I'm curious how this would work in practice if implemented. Thinking about it like that, yeah, it does seem like a contradiction. If it’s the former then I imagine you’d have the ability to transfer into the account from an existing RRSP meaning you can withdraw for a home and not have to pay it back, like you do with the HBP. this seems to be the most likely to me. The latter would be a huge gently caress you to over 40s, who are actually the liberals primary voter base.
|
|
#
?
Aug 29, 2021 20:32
|
|
|
Effort posting after being recommended this thread, I'm looking to buy my first property. Here's my situation: - 31 yo professional - 82k salary + 10-15% bonus per year - No kid, no SO. - Ready to do a 50-55k down payment. Still have money in RRSP, and TFSA but not more than 30k with money set aside for the buy. - Currently renting a 800sqft loft for 1k/month without utilities in a nice location in Montreal. I'm looking to buy a condo. Here why: - New renters in the block are paying 1.6k/month for a similar apartment as mine (I've been renting for 3 years). - Looking at a condo that is around 390k for a similar space/vibe, still in Montreal. - Preapproved for 350k, meaning with the downpayment I ''should'' be able to afford it. (lmao). I've got good credit and rates are 1.8% fixed for 5 years, or 1.2% variable. - Cost with taxes, condo fees, mortgage and utilities would be around 2k/month. I'm currently saving easily 1k per month on top of the 1k I'm paying for the rental. I'm concerned that prices will always be increasing even if there's a downturn in the Montreal real-estate. I've been saving to make a downpayment, and seeing the quality of the available properties degrade while the prices rise is making me very anxious about not jumping in the real-estate grinder. It feels like paying 1/2 my take home money in a living space is a lot, but I can already manage saving that much per month. Not a whole lot would be going towards my TFSA however (200$/month). I do not feel like downgrading my rental to something smaller, and it seems that 390k might the right price to buy something for a similar quality of life of the rental I have. If I were to move, it would be hard to rent something under 1.4k/month. For that amount, that's the mortgage I'm looking at, and a part would be spent paying the principal and not giving it away to a landlord. The condo I visited felt pretty good, and I trust my agent which has been great to my sister who bought about 4 years ago. She thinks I will never lose money on this property, even if I were to sell it in 3 years. I need some reality check, I've heard about not spending more than 1/3 your take home money on a living space, but I don't see how this can be managed without moving out of the city, or buying a 450sqft closet. Is this how everyone does it? Grimarest fucked around with this message at 00:53 on Sep 19, 2021 |
|
#
?
Sep 19, 2021 00:44
|
|
|
First of all, you cannot compare a rent payment and mortgage payment directly and be like it's the same so why not get a mortgage. There are other costs with owning a home and especially a condo; strata fees, property taxes, depreciation costs, general property maintenance. These costs are significant and you wouldn't have to pay them if you were renting since it's all tidily wrapped up in the rent payment. Also, 55k down on a 390k property is a high loan-to-value ratio (less than 20%), so you need mortgage insurance, more money down the drain. On top of that your mortgage interest is probably going to be by far the largest chunk of your payments at least for the foreseeable future, so you shouldn't expect a lot of equity build-up in the medium term. Secondly, interest rates are by no mean fixed for the long term; right now you can afford the mortgage at 1.8% but it's costing you 1/2 of your take home. What is that going to look like in 5 years if interest rates normalize to say 3% or higher? Are you still going to be able to afford it? If you won't be able to, what if you're actually underwater on the mortgage, how is this going to affect your finances in the worst case event that you need to sell? I know this seems unlikely given how house prices have worked in Canada for the past decade, but it's a scenario that you need to take seriously since there is no guarantee they won't fall. Even if interest rates don't rise, if you lost your job, how much runway do you have before you start falling behind on payments? Ultimately, there's nothing wrong with getting a mortgage, but you should be sure that you can not only afford it now, but also that you'll be able to afford it five years from now, and also that you can weather a storm while continuing to make payments.
|
|
#
?
Sep 19, 2021 08:48
|
|
|
Does writing covered calls in your TFSA/RRSP make sense? Normally a potential downside of writing a covered call when the stock goes up to meet your strike price or beyond and your stock is sold at the strike price, you incur a capital gain that has tax implications. You may not want to incur such a taxable capital gain at this time. If the stock is in an RRSP/TFSA then these potential tax implications are eliminated. Now the only downside of your covered call being executed is that you potentially miss out on some gains, depending on how high above the strike price the stock is at. Not really that big of a deal IMO. So given that you can never get dinged by accidentally, severely increasing your taxes, why not move a portion of your holdings into an equity with very high option premiums? For example if you had enough money to buy 100 shares of SHOP, you could place a bet that the stock doesn't reach its 6 month high of ~US$1600 by mid Dec and be paid $2000 for that. If you hosed up and incurred a capital gain on that 100 shares of SHOP because it does reach $1600, that would be uhhh a big tax event, but since it's in a TFSA/RRSP no big deal.
|
|
#
?
Oct 11, 2021 18:19
|
|
|
Femtosecond posted:Does writing covered calls in your TFSA/RRSP make sense? The big concern people have with speculation in a tax advantaged account is just that a) high frequency trading will flag you and b) any losses you suffer mean you've lost contribution room forever. So a super safe covered play on options is still somewhat risky for the latter reason above. The advantages are there also, as you've detailed.
|
|
#
?
Oct 11, 2021 18:30
|
|
|
The big obvious flaw is um, what if the stock goes down? lol. So yeah this is obviously a bullish strategy where in the grand scheme of things you think the equity is going to go up in the long time horizon and you're happy holding the stock. Also I used SHOP as an example, but there's surely some more affordable ones out there. I'm unsure I'd want to risk 100k+ to try to make $2000.
|
|
#
?
Oct 11, 2021 18:35
|
|
|
Not to mention you don’t get to claim capital losses if it’s in a tax shelter.
|
|
#
?
Oct 11, 2021 18:40
|
|
|
What's the trigger for the CRA to decide you're using a TFSA for day trading and tax gains as income?
|
|
#
?
Oct 11, 2021 18:46
|
|
|
I googled for this and found this..quote:You can buy an option or you can write (sell) an option. RRSP investors can buy or sell call options, but call options can only be sold (written) if you already own the underlying shares in your RRSP (called a covered call option).
|
|
#
?
Oct 11, 2021 18:48
|
|
|
Stop using your TFSA to frequently trade stocks — the CRA may see it as taxable business income https://financialpost.com/personal-finance/stop-using-your-tfsa-to-frequently-trade-stocks-the-cra-may-see-it-as-business-income quote:The factors that the CRA looks at include: the frequency of the transaction; the duration of the holdings; the intention to acquire the securities for resale at a profit; the nature and quantity of the securities; and the time spent on the activity. Some more details here
|
|
#
?
Oct 11, 2021 18:52
|
|
|
The article above references it and talks about it, but the direct reference is here. It's not a clear cut line and situation-specific.quote:9. Some security transactions are clearly on income account and these types of transactions are discussed in 15 to 21 below. For other security transactions it will be necessary to examine the facts of the specific case in order to determine whether a transaction is on income or capital account. The tests that the Courts have applied in making such a determination are those of "course of conduct" and "intention" and these tests are discussed in 10 to 13 below. The factors to be considered when determining whether the gain or loss on the disposition of a bond, debenture, bill, note, mortgage, hypothec or similar obligation (debt obligation) is on income account or capital account are set out in IT-114, "Discounts, Premiums and Bonuses on Debt Obligations".
|
|
#
?
Oct 11, 2021 22:40
|
|
|
Hello thread! So my in-laws just gifted my partner $150K. We're renting right now, but it doesn't quite make sense to use it as a downpayment on a place to live, as anything we could afford would be a downgrade from where we're living right now. But my partner's fairly keen on getting recreational property somewhere outside Vancouver. We can probably pool that money with another couple with a similar-sized parental gift and get a nice cabin somewhere on one of the Gulf Islands. We're also not in a rush to do this -- property (especially recreational) is kinda over-priced right now with COVID and the crazy-low interest rates. But it is something we're looking at doing within the next couple of years. Right now it's just setting in a savings account. Between us, we have enough TFSA contribution room to almost squeeze it all into a TFSA. I'm just a little hesitant to throw it into index funds, given how volatile the market is likely to be, and the fact that we're planning on withdrawing sometime in the next year or two. So my question is where to park the money in the meantime?
|
|
#
?
Nov 1, 2021 18:55
|
|
|
Lead out in cuffs posted:Hello thread! Everyone is different etc but I think buying (part of) a recreational property and then later spending even more money as the market here continues to skyrocket would really give you a retrospective migrane. I suggest looking at BC assessment website and picking a random address and looking at what places sold for and then extrapolating that forward. If you think you'll want to use it in the next 3 years I'd put it in a bond ETF, but do you have it in a tax advantaged account at all? Was this gifted somehow in a way that lets you do that? I hope it wasn't pulled from a TFSA and given to you cash, seems like that would just mean that money is going to be taxed on it's growth in that case. If your horizon for using that money is longer you might be best served putting it into something like XGRO/XBAL or VGRO/VBAL where it's getting 80%/60% equity exposure and 20%/40% fixed income exposure. The risk is that if the overall market drops just as you find your dream recreational property you might feel burned taking that money out as a down payment.
|
|
#
?
Nov 1, 2021 19:08
|
|
|
If I definitely wanted to spend it in the next year or two, I'd go GICs and/or high yield savings accounts. If I was ok with waiting a few years should the market take an inopportune dump, I'd look at mixing in some proportion of equities.
|
|
#
?
Nov 1, 2021 19:25
|
|
|
Keep in mind that inflation is expected to go higher in the next year, potentially higher than 5%, so keeping it in cash or very low yield investments will actually lose you significant money. Aside from the already mentioned securities, you could also stick it in an ETF that tracks the total bond market (VAB, for example). It's nowhere near as volatile as equities and you will earn roughly 2-2.5% on your money annually.
|
|
#
?
Nov 1, 2021 20:57
|
|
|
Thanks, this is all helpful! And yeah, buying property in Vancouver just doesn't make sense on our income. We could maybe stretch and get something for $750k, but a) we'd expect to get hosed on the refinancing when interest rates are higher and b) the best we could get for that would be a 3BR townhouse built in the 80s.
|
|
#
?
Nov 3, 2021 21:37
|
|
|
Lead out in cuffs posted:And yeah, buying property in Vancouver just doesn't make sense ?
|
|
#
?
Nov 4, 2021 05:10
|
|
|
Yeah exactly. Not in any way, shape or form.
|
|
#
?
Nov 4, 2021 09:32
|
|
|
Lead out in cuffs posted:Yeah exactly. Not in any way, shape or form. It makes sense if you understand that there is a moral hazard with politicians, both personally and politically, literally being invested in the housing market going up forever.
|
|
#
?
Nov 4, 2021 17:21
|
|
|
Those of you with Simplii financial - are you going through 2-factor authentication every single time you log in regardless if it's a computer you've used previously or not?
|
|
#
?
Nov 12, 2021 16:19
|
|
|
slidebite posted:Those of you with Simplii financial - are you going through 2-factor authentication every single time you log in regardless if it's a computer you've used previously or not? No
|
|
#
?
Nov 13, 2021 06:05
|
|
|
Huh. Which browser are you using? I use FF and it does on both of my computers.
|
|
#
?
Nov 13, 2021 16:47
|
|
|
I don’t know about that site specifically, but it’s possible a scriptblocker or adblocker is somehow blocking the routine that actually caches your data.
|
|
#
?
Nov 13, 2021 17:50
|
|
|
Well I also use unlock origin. When I get back to my PC I'll try it with edge or something. Thanks
|
|
#
?
Nov 13, 2021 22:20
|
|
|
|
| # ? May 17, 2024 15:11 |
|
|
For me, it doesn't ask for 2FA every time I log in on my PC, but on my phone it's stopped letting me open the app from e-transfer links (only the "open in web browser" button does anything) and it makes me re-authenticate every time I use my phone's browser. It's been a couple of months, but I don't get transfers often enough that I've felt it was worth it to look into it for me.
|
|
#
?
Nov 14, 2021 16:40
|
|
