Q: If I buy ZSP in a non-registered account, are the dividends and capital gains treated as Canadian or US?
You can view 3 more answers this month. Sign up for a free trial for unlimited access.
Investment Q&A
Not investment advice or solicitation to buy/sell securities. Do your own due diligence and/or consult an advisor.
Q: I bought LAC shortly before the spin-off. It's now been a bit over a week since the spin-off and my brokerage account shows LAAC with a cost per share which is equal to my original cost of LAC. And it shows LAC of having a cost which is about 71% of the original cost. (So it shows the combined cost for both is 71% higher than the actual cost). Do you know how the cost was supposed to be applied between the two?
-
Royal Bank of Canada (RY)
-
Bank of Nova Scotia (The) (BNS)
-
Bank of Montreal (BMO)
-
Agnico Eagle Mines Limited (AEM)
-
Shopify Inc. Class A Subordinate Voting Shares (SHOP)
-
Converge Technology Solutions Corp. (CTS)
Q: Tax Loss selling time is just around the corner and I would like to take advantage of losses I have in above companies. I have some gains this year and I paid taxes on gains for the last 3 years as well.
Would you sell one position only and which one would you suggest. I would like to buy back at the appropriate time as well.
I would appreciate if you could prepare us for this event of tax loss selling and refresh our memories.
Thank you!
Albert
Would you sell one position only and which one would you suggest. I would like to buy back at the appropriate time as well.
I would appreciate if you could prepare us for this event of tax loss selling and refresh our memories.
Thank you!
Albert
Q: Does their dividend qualify for the Canadian Dividend tax credit?
Thank you
Thank you
Q: Two questions about the Veralto (VLTO) spinoff from Danaher (DHR) (I acquired 125sh as a result of owning 375 shares of DHR), in a taxable account:
1. Would you add to this VLTO position? (In general, per my previous experience, spinoffs are usually attractively priced in the first months following their creation, due to numerous shareholders disposing of relatively small numbers of shares received). Plus, I initially purchased DHR several years ago in large part due to its “water business” (now spun off as VLTO), and so am keen to continue to invest in this sector.
2. Do you know how a Canadian shareholder would account for these shares (in a taxable account)? It looks like my brokerage account has valued the spinoff at US$9631.25, and has not changed (at least, not yet) the book value of the DHR shares (US$113,231). In other words, would the spinoff just be considered as a one-time foreign income event (US$9631.25 or ~CAD$13,200, at ~1.37 exchange rate); sort of like a special foreign dividend, but without any withholding tax applied, with the cost basis for DHR unchanged (US$113,231) and US$9631.25 as the cost base for the acquired VLTO shares (with me paying tax on ~CAD13,200 of foreign income)? Or should this event be considered non-taxable, with the pre-spinoff cost basis of the DHR shares split proportionately between the two entities, DHR and VLTO (something like US$103,600 for DHR and US$9631.25 for VLTO)?
Ted
1. Would you add to this VLTO position? (In general, per my previous experience, spinoffs are usually attractively priced in the first months following their creation, due to numerous shareholders disposing of relatively small numbers of shares received). Plus, I initially purchased DHR several years ago in large part due to its “water business” (now spun off as VLTO), and so am keen to continue to invest in this sector.
2. Do you know how a Canadian shareholder would account for these shares (in a taxable account)? It looks like my brokerage account has valued the spinoff at US$9631.25, and has not changed (at least, not yet) the book value of the DHR shares (US$113,231). In other words, would the spinoff just be considered as a one-time foreign income event (US$9631.25 or ~CAD$13,200, at ~1.37 exchange rate); sort of like a special foreign dividend, but without any withholding tax applied, with the cost basis for DHR unchanged (US$113,231) and US$9631.25 as the cost base for the acquired VLTO shares (with me paying tax on ~CAD13,200 of foreign income)? Or should this event be considered non-taxable, with the pre-spinoff cost basis of the DHR shares split proportionately between the two entities, DHR and VLTO (something like US$103,600 for DHR and US$9631.25 for VLTO)?
Ted
Q: This morning you responded to a question from Ralph regarding TXPDDV. I checked my SDRIF and I see that for my shares of VFV I receive a TXPDDV. I understood that there was no withholding tax in a SDRIF.
Q: When on the calendar do you feel tax loss selling generally bottoms out and would you look to be buying something like Cargojet? Do you have a few other candidates?
Q: Hi Team,
I am down 20% with BCE and 19% with ENB. Would this be a good time to crystallise my capital loss?
Do you see a short term rebound?
If I sell, would you be re-entering these two after the 30 days or move to something else?
Thanks
I am down 20% with BCE and 19% with ENB. Would this be a good time to crystallise my capital loss?
Do you see a short term rebound?
If I sell, would you be re-entering these two after the 30 days or move to something else?
Thanks
Q: Good morning,
If I were to inadvertently trigger the superficial loss rule by selling a security in my wife's cash account, and then forgetfully buying that same security back in my LIRA say 15 days later, would the CRA automatically catch it? Or would they only catch it through an audit? Or should it be self-reported? Just want to better understand how to rectify the error.
If I were to inadvertently trigger the superficial loss rule by selling a security in my wife's cash account, and then forgetfully buying that same security back in my LIRA say 15 days later, would the CRA automatically catch it? Or would they only catch it through an audit? Or should it be self-reported? Just want to better understand how to rectify the error.
Q: Some of my ETF pay a dividend with a code txpddv
Tax paid dividend.
How are they able to do this. What is the possible
down side risks. Thanks.
ralph
Tax paid dividend.
How are they able to do this. What is the possible
down side risks. Thanks.
ralph
Q: hello 5i:
I understand that there is a withholding tax on US dividends within a TFSA. Is the same thing true for interest from a GIC (US GIC denominated in US dollars)?
thanks
Paul L
I understand that there is a withholding tax on US dividends within a TFSA. Is the same thing true for interest from a GIC (US GIC denominated in US dollars)?
thanks
Paul L
Q: As a Canadian, if I purchase RY:US on a US Exchange, will the withholding tax rules apply in this case ?
Q: Good afternoon. I have the following tax loss selling question.
Let assume I sell 1000 shares of BCE on October 1. To avoid the superficial loss rule, I will wait 30 days to buy it back. Let’s assume this is November 1.
Then on October 15th, I sell another 1000 shares of BCE. As per the above, I will buy them back on November 15th.
The question I have is as follows - If I buy back the 1000 shares of BCE as planned on November 1st from the first tax loss sale, will this compromise my ability to claim a loss from the second sales of BCE shares on the 15th?
Let assume I sell 1000 shares of BCE on October 1. To avoid the superficial loss rule, I will wait 30 days to buy it back. Let’s assume this is November 1.
Then on October 15th, I sell another 1000 shares of BCE. As per the above, I will buy them back on November 15th.
The question I have is as follows - If I buy back the 1000 shares of BCE as planned on November 1st from the first tax loss sale, will this compromise my ability to claim a loss from the second sales of BCE shares on the 15th?
Q: This is about the question asked by Paul regarding tax consequences. I am not sure I understand your answer, you say that "one can even sell in late December (as long as the sell settles in 2023) and then in January and shift the tax burden a full year". In a case like this I would have thought of selling very early in January 2024 instead. Could you comment? Thank you
Q: Awhile ago a G & M columnist wrote a reply to a question and gave advice and details about selling a U.S. listed stock. He recommended not doing it all at once for tax reasons and I am wondering what your thoughts would be. I bought 300 shares of QQQ in the 1990's at about $43/share. It has grown to be a significant portion of my non registered account. I was thinking of selling 100 shares each of the next three years to lessen the tax consequences. (I am a buy and holder). Thoughts and consequences?
Cheers
Paul
Cheers
Paul
Q: For non-registered accounts:
a) Am I correct in assuming that capital losses can only be used to reduce tax on capital gains. and not any other sources of income, such as investment interest ?
b) Similarly, how about capital gains tax reduction through an RRSP contribution -- is this allowed ?
Thank you
a) Am I correct in assuming that capital losses can only be used to reduce tax on capital gains. and not any other sources of income, such as investment interest ?
b) Similarly, how about capital gains tax reduction through an RRSP contribution -- is this allowed ?
Thank you
Q: same sector tax-loss strategy...What am I missing here...with the assumption that the banks move more or less in tandem...
If I sell BNS stock at a $30K loss and use the funds to buy BMO as a "placeholder", won't I be in the same position either way? i.e. after a 10% gain I would either recover my losses as the BNS stock increases or I would grow tax-free gains as the BMO stock increases (up to $30K)...
Surely for this tax loss strategy it is best to just stick with the company I most believe in, yes?
If I sell BNS stock at a $30K loss and use the funds to buy BMO as a "placeholder", won't I be in the same position either way? i.e. after a 10% gain I would either recover my losses as the BNS stock increases or I would grow tax-free gains as the BMO stock increases (up to $30K)...
Surely for this tax loss strategy it is best to just stick with the company I most believe in, yes?
Q: Hi Peter and Team, your readers may be interested to know that Tim Cesnick's tax and finance articles published by the Globe & Mail are organized and freely available in one location on his website, ourfamilyoffice.ca/our-thinking/articles/ Similar to 5i, he is generous in sharing his knowledge and seems driven by the motto, 'wealth is good provided everyone is wealthy'. I thank you for your significant contribution my and my wife's progress in financial knowledge and literacy.
Q: Is there any difference in tax treatment between VFV and ZSP in a TFSA?
Q: I think there may be some confusion about my previous question re VFV and also a question posed by umedali.
I may have misunderstand, but you seem to imply that VFV would undergo double taxation (withholding) because it is an etf that holds another etf. Is that what you mean by a “second level” of tax?
I am not sure this is correct. The etf being held by VFV would be U.S. domiciled, which would not be subject to tax on the dividends it receives from U.S. companies. However, VFV, being Canadian, would be subject to tax on the flow through of dividends to it from the underlying etf. Then, after this, the dividends should flow through to a Canadian holder without further tax, since it is from a Canadian listed etf. So only one round of taxation. Unfortunately, they call it “level 2” taxation in that link you provided, which is about the most ambiguous label they could have possibly come up with.
As far as I can tell, double taxation would only come into play if the underlying etf held by VFV itself held foreign securities (ex European stocks).
Apologize if I’ve got this all wrong, it’s not very clear on the Vanguard website imo.
I may have misunderstand, but you seem to imply that VFV would undergo double taxation (withholding) because it is an etf that holds another etf. Is that what you mean by a “second level” of tax?
I am not sure this is correct. The etf being held by VFV would be U.S. domiciled, which would not be subject to tax on the dividends it receives from U.S. companies. However, VFV, being Canadian, would be subject to tax on the flow through of dividends to it from the underlying etf. Then, after this, the dividends should flow through to a Canadian holder without further tax, since it is from a Canadian listed etf. So only one round of taxation. Unfortunately, they call it “level 2” taxation in that link you provided, which is about the most ambiguous label they could have possibly come up with.
As far as I can tell, double taxation would only come into play if the underlying etf held by VFV itself held foreign securities (ex European stocks).
Apologize if I’ve got this all wrong, it’s not very clear on the Vanguard website imo.