Investments in Canada

markjhamilton · Post by **markjhamilton** » Sun Apr 19, 2015 8:42 am

I am a US Resident with US earned income and Canadian Pension and RIF income. I pay 15% Canadian Withholding Tax on that income and report it on my US taxes with a corresponding foreign tax credit. I was previously converting the CAD funds to USD and transferring them to a US bank account, but with the recent poor exchange rate I have been leaving the CAD accumulating in my Canadian bank account. My question is whether there is any way of investing the CAD funds without triggering a requirement to file a Canadian Tax return.

nelsona · Post by **nelsona** » Mon Apr 20, 2015 7:03 am

It's not a question of taxes. Its a question of securities regulations. A US resident is not permitted to have a Cdn brokerage account. And US residents are not permitted to buy Cdn mutual funds (except in limited cases in their RRSP/RRIF).

So, you cannot buy Cdn stock etc in C$. You can of course bring the money to US and buy Cdn companies traded on US markets. You might ven find a CUS broker who trades on the Cdn markets.

nohairleft · Post by **nohairleft** » Tue Apr 21, 2015 12:19 pm

You can try Interactive Brokers. They permit cash holdings in multiple currencies (including CAD), and you can trade TSX securities there if you like. You won't want to invest in Canadian mutual funds or ETFs due to PFIC regulations, so that's about your only real option if you don't want to convert currencies.

If you ever decide that you do want to convert the money to USD, they can also generally crush the exchange rates offered by standard banks (ie. a small fixed fee gets you interbank plus 2 pips).

Note that the IB interface is designed for traders, so the UI is not for the faint-of-heart.