Investment Q&A

Q: I am a Canadian citizen/resident. I use my non-registered investment accounts to hold dividend-paying Canadian companies as well as U.S. companies that pay no/small dividends. I use RSPs for U.S. companies that pay larger dividends. I use TFSAs to hold securities such as Canadian REITs and companies with unusual dividends such as BEP.UN and BIP.UN. My understanding is that BIPC is essentially “equivalent” to BIP.UN, but that BIPC will pay fully eligible dividends for which T5s will be issued (not sure if the BIPC distribution will be paid in CA$ or US$). Here are my questions: (a) given the above considerations, would it make sense for me to sell BIP.UN/BIPC within my TFSA, using the cash to acquire more of Canadian REITS and/or similar types of securities (with unusual dividends), and to reacquire the same value (of BIP.UN/BIPC shares sold) through purchase of shares of BIPC in a non-registered account? And (b) do you know whether it is known yet in which currency the future BIPC distributions will be paid?

Ted

Q: While Brookfields’s limited partnership companies such as BIP and BIP.UN “declare” their dividends in US dollars these are actually paid to Canadian brokers such as Scotia iTrade in the Canadian dollar equivalent as of the record date.
If an investor holds those units in the US dollar side of their brokerage account, they can be charged a conversion fee by the brokerage to convert back to USD. In the case of Scotia iTrade this has been in excess of 2% in the past.
Do you know if this will be the situation with future dividends paid by BIPC?
Thank you for all your due diligence on our behalf.

Q: I have a little Brookfield Infrastrucure, and was thinking of buying more. I'm concerned, though, about short and medium-term risk given they have holdings such as timber (the demand for which has fallen), gas transmission lines (the value of which rises and falls with price), toll roads (which aren't getting much use), and rail lines that require coal demand. Do you think their next quarterly report will show a drastic downturn beyond what most people are expecting?

Q: Hi,
I received shares of BIPC as a spinoff from BIP.UN. Can you five some information about the new company? How similar or different are they from each other? I am holding it in RRSP. Should I sell one and acquired the other for equivalent $ amount.
Thanks

Q: Hi 5i,

All other things being equal, wouldn't BIPC be superior over BIP.UN because of tax implications and greater accessibility by a wider range of investors?

I ask because I noticed over the last few trading days, BIP.UN has traded at a slight premium over BIPC. I would think it would be the opposite. Maybe some investors are doing portfolio clean up after the split and selling the small amounts of BIPC they have?

Personally I think BIPC is the better one to own?

TIA!
Wayne

Q: From my previous question on owing BIPC in a TFSA you state that it's better to own BIPC in a non registered account because of the dividend tax credit (that I understand)...but is that dividend tax credit really applicable or needed for a TFSA? I currently hold BIP.UN in my TFSA and I'm still trying to find the reason for switching to BIPC. Would it be withholding taxes?

Q: Not a question - a clarification as I don't think the distribution/dividend level has been fully explained. Before the split I was in contact with BIP.UN IR to clarify the distribution level and was informed that the distribution level would be identical for both BIP.UN and BIPC but will be at 90% of the BIP.UN distribution rate prior to the split. This ensures that the total distribution for the 2 holdings are equivalent to the pre-split amount. Here is the wording from the prospectus.

"Further, immediately following completion of the special distribution, the
distribution level on the units will be reduced to nine-tenths (9/10ths) of the pre-closing distribution level as a result of the one (1) for nine (9) special distribution, and the dividend level on the class A shares will be identical to the post-closing unit distribution level, with the result that the aggregate distribution received by a holder on its units and class A shares will be the same as it would have received if the special distribution had not been made."

Hope this is useful for everyone out there who now holds BIP.UN and BIPC.

Q: Further to my earlier question today- just realised I still have the original BIP shares (duh!). Hard to tell with this volatility but is the BIPC a "bonus" or is BIP value offset by the same amount? Will BIPC be paying a dividend and what is the rate? Thanks and sorry for the confusion.

Q: The questions on this security seem to never end but why is it better to own BIPC in a TFSA than BIP.UN?

Q: Hello 5i
BIPC has been placed in my American unregistered account. Also my wife has the same but in her TFSA account. Should I leave everything as is or put BIPC into a Canadian account? I am retired with a good pension. TD just has the stock as BIPC not BIPC.CA or BIPC.W, though it is in a U.S. account.
Stanley
Stanley

Q: I didn't follow this.company till I read the split.Can you explain the.difference briefly and which company do you think has better growth

Thank you.

Q: Hello
I sold bip and just recieved my bipc shares.
My choices are
do nothing
buy more bipc
purchase bpi (after the mandatory 30 days)
Your opinion wil be appreciated
CDJ

Q: I own BIP.UN and have received BIPC in my non-registered account. Should I sell BIP.UN and buy BIPC to get higher Canadian dividend tax credit? Will there be any tax implication? Can BIP.UN be exchanged with BIPC, without incurring expenses? Thanks.

Q: Hi Gang, I owned BIP.UN for years in a non registered account and if I don't mind writing off the capital gains against capital losses this year, would I be better to put all the proceeds from BIP.UN into BIPC going forward because of the tax credit.
Thank you
Anthony

Q: Held in non registered account is the 5% Dividend a clean Canadian dividend qualified for tax credit or another nightmare at tax time k-1 form , 1135 form …. ETC

Q: I have a loss on BIP but I like the fund. It would seem wise to sell the BIP and buy BIPC. Would this violate the capital gains loss?

Q: Greetings 5i and thank you for your hard work.
I have combed through the various Q's on BIP and see bits and pieces of what is happening with the 'new' shares but do not feel I have the whole picture - plse assist.
I own 300 shares of BIP.UN in a non-Reg account: what can I expect to happen and what should I wind up with when the dust settles? What will be the nature of the shares be and how many will I own?
Thanks again
SP

Q: I currently own shares of BIP.UN - will they be automatically converted to BIPC shares or is there something I have to do on my side to initiate the conversion ?
Thanks

Q: Bipc started trading on mar 31. When does Bepc begin trading?

Q: Dear 5i,

For a new purchase in a NonReg account. Is it better to buy BIPC compared to BIP.UN due to the eligible dividend?
For a new purchase in a RRSP account which one is better to buy?
For a new purchase in a TFSA account which one is better to buy?
Can you confirm that a Canadian holder of any of the above receive the dividend
automatically converted by Brookfield into CDN dollars.

thanks

Ian