Regarding RRSP or RRIF distributions to non-residents in the US:
I came across this on a web site:
Distributions paid to Unitholders who are non-residents of Canada for Canadian income tax purposes are normally subject to a withholding tax of 25% of the taxable amount of the distribution (i.e. interest and dividend income portion only), as required by Canadian income tax laws, unless a lower percentage is prescribed by a reciprocal tax treaty in effect between Canada and the non-resident's country of residence. For example, for individual Unitholders who are residents of the U.S., the reciprocal tax treaty between Canada and the U.S. prescribes a reduction of the withholding tax rate to 15% on the taxable amount of a distribution received from a trust. Please note that there is no withholding tax requirement on the portion of the distribution classified as a “return of capitalâ€.
Is this true ? No Cdn withholding tax on the 'non-taxable' portion?
No withhoding tax on part of my RRSP distribution?
Moderator: Mark T Serbinski CA CPA
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