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The subscriber has control of the funds. If you have the giftees SIN you can open a RESP for them and if they don't use it you can transfer it to your RRSP but any grants would be returned. Yes: https://www.canada.ca/en/services/benefits/education/education-savings/paying-education.html#_howto
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Dec 8, 2023 04:42
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if you have the beneficiary’s SIN and the parent is in the same physical room as you at the bank, you can open an RESP in for someone. I presume that this is so that the parent doesn’t get surprised by overcontribution or something, but it was so baroque that I just ended up giving cheques to the kids’ parents (who, happily, I trust) they make this pretty hard
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Dec 8, 2023 05:30
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lmao wtf. maybe my credit union will be chiller than a bank and let my sister zoom in or something. like we don't live in the same city
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Dec 8, 2023 16:16
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exactly my problem I had My Banker try and twist RBC into doing it, but no dice
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Dec 8, 2023 21:20
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You could try an online broker, my family resp is with questrade.
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Dec 8, 2023 21:30
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Common wisdom says if I have 4 grand kicking around not doing anything, throw it onto the mortgage (which has 374k remaining). But should I actually do that? A few grand isn't going to make a big difference, it's not like I'm paying this thing off while I'm still alive anyway, I'm just hoping a developer comes along one day. Variable rate, because I'm an idiot. I suppose if I really wanted to min max I could research average returns on some sort of investment and compare it to the amount I would save on the reduced interest payments on the mortgage (probably pennies). Another idea is to put it into my rrsp and fatten up the tax return. I'm not really expecting it to make much difference whatever I do (including option D, saying screw it and going on a vacation, which tbh is what I really want to do), but basically I've had this dumb mortgage for a couple years now and I'm starting to actually think about how to handle my leftover money, so I figured I would bounce my nebulous thoughts off this thread so it isn't going to waste.
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Dec 12, 2023 04:54
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stratdax posted:Common wisdom says if I have 4 grand kicking around not doing anything, throw it onto the mortgage (which has 374k remaining). But should I actually do that? A few grand isn't going to make a big difference, it's not like I'm paying this thing off while I'm still alive anyway, I'm just hoping a developer comes along one day. Variable rate, because I'm an idiot. There's a lot of energy in this post that sounds like you're frustrated and trying to dig your hole deeper because *why not I'm already _____*. I think if you're upset about a prior bad decision (variable rate) you should start making good ones instead of having some reaction to be irresponsible with cash. How's your emergency fund? Are you carrying any other debt? Hows your TFSA? Do you have a pension through your work already? Any upcoming major costs? Would your mortgage even allow you to make one time payments right now or is it only on the anniversary date of the mortgage? I don't think it's 'common wisdom' at all to toss extra money into your mortgage, if you're making a decision about paying your mortgage down vs investing, you need to look at the expected returns of each.
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Dec 12, 2023 05:28
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You should have an emergency fund if you don’t already, I’d recommend 6-12 months of expenses. Throwing stuff into the mortgage and leaving yourself with no safety net is dumb and will get you into trouble if you were to lose your job. After that it’s really up to you what you do with your money, paying off the mortgage is a guaranteed return but it’s cash you might no longer have access to if you really need it (HELOC doesn’t count as an emergency fund), investing in low cost index funds will keep you diversified, keep you liquid, and shores your finances up for the foreseeable future.
qhat fucked around with this message at 18:09 on Dec 12, 2023 |
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Dec 12, 2023 18:05
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Putting $4k towards a mortgage at 7% is functionally the same as investing money into something that will return guaranteed 7% tax free. That's a pretty sweet investment! If rates hold steady (big if, I know), that $4k will save you over $20k in 25 years!
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Dec 12, 2023 18:15
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VelociBacon posted:There's a lot of energy in this post that sounds like you're frustrated and trying to dig your hole deeper because *why not I'm already _____*. I think if you're upset about a prior bad decision (variable rate) you should start making good ones instead of having some reaction to be irresponsible with cash. How's your emergency fund? Are you carrying any other debt? Hows your TFSA? Do you have a pension through your work already? Any upcoming major costs? Would your mortgage even allow you to make one time payments right now or is it only on the anniversary date of the mortgage? It's not that bad, I guess I came across strong. Somehow I'm only paying about $200 a month more than I would have been on the fixed rate they offered me. I guess they already priced in the rate increases. No emergency fund to speak of, so I'll start building that up, as per qhat's suggestion, I guess using TFSA (which I don't have) to buy some index funds. No other debt. People still get pensions?  Although I am contributing a good amount to an RRSP (no choice, it's designated as part of my hourly pay as per my union contract). Square Peg posted:Putting $4k towards a mortgage at 7% is functionally the same as investing money into something that will return guaranteed 7% tax free. That's a pretty sweet investment! If rates hold steady (big if, I know), that $4k will save you over $20k in 25 years! See this is why I made my post. I never would have thought of it like this. Thanks for the tips guys.
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Dec 13, 2023 08:01
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Subjunctive posted:if you have the beneficiary’s SIN and the parent is in the same physical room as you at the bank, you can open an RESP in for someone. I presume that this is so that the parent doesn’t get surprised by overcontribution or something, but it was so baroque that I just ended up giving cheques to the kids’ parents (who, happily, I trust) I looked into this as well when my neice was born. I just give my brother a cheque, it was far too much effort to open an account myself.
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Dec 14, 2023 22:49
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Hi folks. I made a bunch of money gambling this year. Now it's time to put it away in an RSP or bite the bullet on taxes and put in in a TFSA. I know I've asked this before, but should I start filling up the TFSA first before RSP? I'm just starting my savings. I hope to have many years to sit with it in my investments. Napkin math: RSP Deposit: 1000 Retirement Age: 4000 (4x adjusted for inflation) After Tax: 3000 TFSA Income:1000 After Tax: 750 Retirement Age: 3000 (4x adjusted for inflation) what a scam... they're the same!
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Dec 15, 2023 05:47
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This page sums it up pretty well I think https://www.taxtips.ca/tfsa/which-is-better-tfsa-or-rrsp.htm
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Dec 15, 2023 06:35
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Toalpaz posted:Hi folks. Sorry but why do you think TFSA are taxed or something? You've implied it twice. Where is the $250 going in your napkin math for the TFSA? What are the numbers meaning for retirement age? I'm so confused. You can freely pull money or of TFSA accounts without paying tax on it. I think the opposite is true for RRSPs.
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Dec 15, 2023 06:52
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VelociBacon posted:Sorry but why do you think TFSA are taxed or something? You've implied it twice. Where is the $250 going in your napkin math for the TFSA? What are the numbers meaning for retirement age? I'm so confused. You're taxed on your income before it goes into a TFSA vs getting that tax back if you put it into an RRSP.
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Dec 15, 2023 07:26
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I think I see what Toalpaz is assuming - a 25% tax rate for both cases. So they have 1000$ in income and either invest that in an RRSP in full, paying 25% on withdrawal, or for the TFSA they pay that tax upfront (750$ being left to invest).Toalpaz posted:what a scam... they're the same! With an RRSP you’re planning for the scenario that your income tax rate is lower in retirement. This is why the advice is generally to prioritize a TFSA when you’re young, then work on the RRSP in your higher-earning years.
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Dec 15, 2023 08:38
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Tsyni posted:You're taxed on your income before it goes into a TFSA vs getting that tax back if you put it into an RRSP. Not if it’s a gambling windfall. Seems like putting it into the TFSA to entirely avoid taxes is the way to go.
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Dec 15, 2023 16:27
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Jordan7hm posted:Not if it’s a gambling windfall. Seems like putting it into the TFSA to entirely avoid taxes is the way to go. Lol, I guess this question was a fancy trick problem for the thread and you actually won. I inadvertently posed it not knowing the actual gambling and lottery tax laws, and language around windfall. Unfortunately my situation is different, it's business income from short term capital gains of an investment account. E: Yes, I hope to be in a bigger and better tax bracket in ten years so I will try and save my rsp contribution room.
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Dec 15, 2023 16:56
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Jordan7hm posted:Not if it’s a gambling windfall. Seems like putting it into the TFSA to entirely avoid taxes is the way to go. Depends on the gambling. If it's official/licensed (ie: local casino/OLG type scenario - ie: you're paying taxes via the host), if anything else, it's generally taxable income.
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Dec 15, 2023 16:56
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unknown posted:Depends on the gambling. If it's official/licensed (ie: local casino/OLG type scenario - ie: you're paying taxes via the host), if anything else, it's generally taxable income. I thought the distinction is whether or not the winnings are luck or skill based, and if skill based whether or not you’re a professional, not where you win the money. https://rosentaxlaw.com/are-gambling-winnings-taxable-in-canada/
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Dec 15, 2023 17:23
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An idea I've had is that, in retirement, one could withdraw from the RRSP and TFSA at the same time, thereby artifically lowering the tax rate on the RRSP. Thoughts?
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Dec 15, 2023 17:31
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It'd probably be more accurate to describe it as minimizing your overall tax liability, but yes, withdrawal strategies that take advantage of income tax breakpoints or marginally increase income during some years to qualify for benefits later on are a thing. It's heavily dependent on your personal circumstances because (eg) something like whether or not your pension qualifies form income splitting before 65 will drastically change the answer.
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Dec 15, 2023 18:01
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Jordan7hm posted:I thought the distinction is whether or not the winnings are luck or skill based, and if skill based whether or not you’re a professional, not where you win the money. That link roughly corresponds with what I said. If you go to a poker tournament and won big money, you'll have a hard time proving that you went in expecting to lose (which is tax free). And luck based games are licensed by the government (lottery/casino) in order to prove they are indeed luck based and everyone playing has a fair chance. That being said, the law is written such that there's a lot of vagueness at tax time to nail you either way.
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Dec 17, 2023 04:13
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My in laws are moving into the granny suite that came with our house that we don’t really use (locals were upset that we didn’t rent it out to people  ). I heard on CBC the Canada/ Nova Scotia (?) has a program for people who have their parents move in, can anyone explain if this thing we were going to do anyway could benefit us? I’d be worried about them not getting their OAS cheques and such.
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Dec 24, 2023 21:14
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Not sure if this is the right thread, but has anyone here ever used the Lifelong Learning Plan thing to borrow from their RRSP to pay for post-secondary tuition etc? Thinking about going back to school part-time and finishing my degree, and I've got a good bit in an RRSP, and was wondering if it's worth borrowing against that. It looks like you have a 10 year repayment timeline but some of the wording is a bit odd so I wanted to see if anyone on SA knows what's up with the program.
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Dec 31, 2023 09:38
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Kazinsal posted:Not sure if this is the right thread, but has anyone here ever used the Lifelong Learning Plan thing to borrow from their RRSP to pay for post-secondary tuition etc? Thinking about going back to school part-time and finishing my degree, and I've got a good bit in an RRSP, and was wondering if it's worth borrowing against that. It looks like you have a 10 year repayment timeline but some of the wording is a bit odd so I wanted to see if anyone on SA knows what's up with the program. I had a post written out explaining the repayment (because my area is tax not finance), but I double-checked the requirements and it needs to be a full-time program (as defined by the institution, unless you have a disability) to be allowed.
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Jan 2, 2024 20:27
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Hi folks, I'm looking for advice on opening not just a US dollar account, but an American domiciled US dollar account as a Canadian with no American citizenship or SSN. I think this is possible, but the steps are very unclear and the SEO is horrible given the terms involved. I see my need like this:
As a result, I'm thinking my solution looks like this:
Canadian USD accounts fail in these ways:
I'm a little embarrassed that I wrote out so much trying to solve 30-60 dollars CAD a year in Wire/Swift transfer fees... I've spent a long time trying to optimize this transaction poorly. I don't want people to have to do research for me, but if anyone else has existing experience with opening a US account they could share that would be nice!
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Jan 3, 2024 23:25
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I have had similar difficulties transferring USD to myself, which seems like it should be easy, but no, the entire North American banking system is stupid as hell. For example, I don't think you can transfer USD between Canadian Simplii and CIBC USD accounts even though they're the same drat bank. Some suggestions: - CIBC and TD have US banks. You may be able to open an account with them without an SSN, although maybe not without actually going to a US branch. Most US banks have no idea or can't be bothered to deal with nonresidents. - Give up on doing transfers between your accounts and instead get chequing accounts on both sides of the border and write yourself cheques. Most banks let you deposit with apps if you can't find a compliant ATM. - Alternatively, you might be able to just withdraw and deposit cash, for example some Citibank accounts have fee-free global withdrawals on some ATM networks (and possibly you can skip Wise altogether this way).
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Jan 4, 2024 00:13
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I have never tried to open a US account and can't help there, but Wise doesn't need a US chequing account to hold funds unless there's some limitation I'm missing. I've had both USD & CAD on my Wise account directly, albeit only for short term purposes.
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Jan 4, 2024 00:31
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Toalpaz posted:I've spent a long time trying to optimize this transaction poorly. I don't want people to have to do research for me, but if anyone else has existing experience with opening a US account they could share that would be nice! For a couple years I was getting paid regularly in US$ and wanted to minimize fees overall. I ended up with this setup: • This RBC Bank checking account: https://www.rbcbank.com/cross-border/us-bank-accounts/direct-checking.html note that RBC Bank is related to but technically distinct from RBC Royal Bank. It is a US-domiciled account that can accept ACH transfers and transfer US$ to a Canada-domiciled account. • This RBC Royal Bank US$ savings account: https://www.rbcroyalbank.com/accounts/us-e-savings.html it can accept US$ as a "cross-border transfer" from the aforementioned checking account. • An RBC Direct Investing account. It can accept US$ from the aforementioned savings account and allows Norbert's Gambit without having to call anyone. I bought/sold DLR to do the currency exchange. • The most basic boring RBC Royal Bank chequing account. This accepts CA$ from the brokerage account and let me boop it around Canadian banks so I could spend it. It is positively rube goldbergian but it worked just fine a couple years ago. (I now get paid in CA$ so I have since shut it all down.) I would not necessarily recommend this exact setup but it's a working example and might point you to some useful things. For example, I knew someone who did roughly the above but used Knightsbridge for the currency exchange step. I hear ya on the seo'd bullshit. Took me ages to figure the above out. Happy to answer any questions!
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Jan 4, 2024 01:14
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Toalpaz posted:Hi folks, I'm looking for advice on opening not just a US dollar account, but an American domiciled US dollar account as a Canadian with no American citizenship or SSN. I think this is possible, but the steps are very unclear and the SEO is horrible given the terms involved. I can't help with that, but I swear I've seen you post about having ADHD. Wondering if you might qualify for the Disability Tax Credit, which would get you a break on your income tax. It would also let you open a Registered Disability Savings Plan. Hit me up if you want more info on that. There are some scams out there around the DTC, but the rule of thumb is just to avoid anyone asking for money. (Other than your doctor, who might charge a fee for filling in the forms.)
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Jan 7, 2024 21:39
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Pixelante posted:I can't help with that, but I swear I've seen you post about having ADHD. Wondering if you might qualify for the Disability Tax Credit, which would get you a break on your income tax. It would also let you open a Registered Disability Savings Plan. Hit me up if you want more info on that. Thanks, this is good news! I'm pretty enthusiastic about navigating finance and taxes, so I'll probably handle getting the statement from my Nurse Practitioner and filling the form t-2201/application myself. This could be an amazing windfall personally, so thank you so much. I feel my innattentive ADHD has been disabling and have had my symptoms rated above moderate (I've skipped work and dropped out of graduate school, mostly due to ADHD symptoms and inability to cope). If you ever know someone who consistently has difficulty planning, remembering what you say in conversations or starting/finishing projects that they seemed enthusiastic about in the past - mention it, you can get checked out via nurse practitioner clinics easily and economically. Nurse practitioners can also vouch for the seriousness of symptoms to the CRA in a recent update to enhance northern communities access to healthcare. Now that I'm getting treated I'm doing much better, but still trying to find the right dose and therapy to develop better work strategies. US cross-border banking! I went through calls with the big banks! I have realized the real issue back when I started was I didn't have my appropriate photo ID (they do not accept certificate of Indian status cards) or proof of address. I have my passport now but my name isn't on the lease and I have been paying into a pay as you go plan with freedom - no proof of address. In Canada, a status card is usually 'proof of address' or residency or citizenship and ticks most boxes being a federal card. Sometimes you have to argue a bit but that's how I've gotten by. My issue with US banking was likely because I'm under documented. Proof of address is tricky, should pick up that state ID - but part of getting it is attesting to them you don't plan on getting a driver's license and I didn't want to do that. I'm going to enrol in a real phone plan/contract and get a proof of address. Toalpaz fucked around with this message at 15:41 on Jan 9, 2024 |
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Jan 9, 2024 15:30
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Hmm. I don't remember having ID problems with US banks but then I think my old G1 had not expired yet (lol). CIBC Canada demanded I show a second piece of photo ID beyond a passport and wouldn't accept a photo OHIP card or expired G1, but would take a laminated citizenship certificate which is absolutely idiotic considering those certificates have virtually no security features and aren't even issued anymore but those are apparently the rules.
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Jan 9, 2024 16:31
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Toalpaz posted:Thanks, this is good news! I'm pretty enthusiastic about navigating finance and taxes, so I'll probably handle getting the statement from my Nurse Practitioner and filling the form t-2201/application myself. This could be an amazing windfall personally, so thank you so much. If you happen to be in BC, I can get you an advocate to help with the forms. If not, I can still give you some general advice on filling in Part B of the T2201. My job involves filling in those forms for kiddos, usually with autism and/or autism. In a nutshell, don't mention anything positive. You're trying to give the CRA a clear picture of your disabilities, not a balanced report. Also, if you get hyperfocus that's detrimental, you can mention that in the appropriate section. I use a lot of language like, "Patient struggles with adapting to change and will have meltdowns if routine is altered, e.g. crying, withdrawing." Remember that you're writing it as if the NP filled it in, not you. Generally doctors and NPs just don't have time to do the forms with the level of detail needed, especially with spectrum disabilities like ADHD, which is where my work comes in to fill that gap. Some NPs/doctors will let you fill in Part B of the T2201 yourself for them to review and sign, and it sounds like that's what you're going to do.
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Jan 9, 2024 19:43
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I've got a weird tax question that I'd appreciate someone with some expertise to comment on. Suppose I have 100k of income generating assets in a brokerage and I withdraw 20k on margin to buy something frivolous. Since the investments inside the brokerage account are now leveraged investments, is the interest on the margin loan deductible, or did me purchasing the frivolous thing change that? If no then in a similar vein, what if instead of withdrawing directly on margin, I instead liquidated 20k of investments, withdraw the 20k in cash to purchase the frivolous thing, and then re-purchased the exact same investments on margin. Does that change anything despite it being the same outcome? I feel like it's a grey area, or not, I literally have no idea what the rules surrounding this would be so any insight would be great.
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Jan 30, 2024 08:42
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I just received a letter that the US Weed Index ETF I bought a few hundred bucks of is being terminated in March. Do I need to sell them before the termination date, or do I wait untill the end for a mandatory redemption? They're in a Questrade TFSA.
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Jan 30, 2024 20:01
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If you sell before mandatory redemption, you can time your disposition so that it's most advantageous for you tax wise or even market wise. Unfortunately it is a forced disposition which is a taxable event which matters if you are holding it in an unregistered account.
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Jan 30, 2024 20:16
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qhat posted:I've got a weird tax question that I'd appreciate someone with some expertise to comment on. Ooh, good question. I've never seen anyone try this, but theoretically, it should be a "no" to both. You could theoretically try and run the risk of CRA auditing such a claim, but if they do they'll look at the circumstances in which the claims were made. So if they see $20k withdrawn from a loan where it didn't go into an investment, they'll disallow a portion of the interest. The second one still falls under intent but might be harder to catch. Again, don't know how often this kind of thing happens but they may end up deeming the interest as ineligible if you repurchased it too soon. At least, I would assume that repurchases are flagged by systems when reported in general, since they are on the lookout for superficial losses. Again, I'm just an internet accountant with no skin in the game, but tl;dr - I would say "no" both times because they run afoul of intent, and with enough information an auditor could determine that money was withdrawn for non-investment purposes if they so choose. Like, we've had a few clients who use personal LOC's for investment purposes, but we usually ensure they track how much of their loan was for investment purposes and only claim a portion of the interest. Yeast Confection posted:I just received a letter that the US Weed Index ETF I bought a few hundred bucks of is being terminated in March. If they're in a TFSA, there's no tax burden. The question is whether or not they'll give you more for the investment than current share price. Or am I missing something?
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Jan 30, 2024 20:25
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mojo1701a posted:Ooh, good question. So I actually went away after posting this to find more info, and apparently the CRA are super detailed in what is and isn't acceptable in this regard. Infact they do seem to state that yes, if you liquidate shares of X corp and withdraw for personal use, and then borrow money to re-purchase shares of X corp, that does in fact trigger the deduction. https://www.canada.ca/en/revenue-ag...lity.html#toc16 Let me know if I've read that wrong somehow, but seems like as long as the borrowed money is clear cut linked to a purchase of an income producing asset, you're good to go. Which is interesting because most people probably don't know that, and also that it's probably contingent on approaching the problem the right way (i.e making it all transparent).
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Jan 30, 2024 22:26
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qhat posted:So I actually went away after posting this to find more info, and apparently the CRA are super detailed in what is and isn't acceptable in this regard. Infact they do seem to state that yes, if you liquidate shares of X corp and withdraw for personal use, and then borrow money to re-purchase shares of X corp, that does in fact trigger the deduction. Huh. I thought the CRA would've had a rule for it, but I guess I was letting the superficial loss rules cloud my judgment. Honestly, thanks for posting this. I'm glad I learned this.
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Jan 30, 2024 23:34
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