Non resident Canadian citizen investing in Canada -

From:           anonymous
Reply To:       verypuzzled
My_question_is: Canadian-specific
Subject:        Non resident Canadian citizen investing in Canada
Expert:         taxman at
Date:           Friday October 21, 2005
Time:           12:34 PM -0700
I'm a Canadian citizen. I married a US citizen and moved to the US. Now
Banque Nationale says that I can keep my mutual funds but I can't move the
money to different funds. Also, other institutions state that non residents
can't open a account to buy Canadian securities. Is this correct?
Non-resident Canadians can't invest in Canadian securities? This doesn't
make sense as I sense that the Canadian government itself has websites
designed to attract investments to Canada. Is there a brokerage that will
open up an account for us in Canada so we can invest in Canadian securities?
Thanks ... Very Puzzled
david ingram replies:
The problem is not solely that of the Canadian Government.  The problem is
that the US Securities and Exchange Commission (SEC) does not allow a non US
registered broker to sell to a US resident.
And, if you had moved to Nova Scotia, an Ontario registered mutual fund
salesperson could not sell to you because he or she was not registered in
Nova Scotia and that would violate Nova Scotia Rules.  Some mutual Fund
representatives like the one I deal with Fred Snyder are registered for
Ontario and British Columbia and others are registered for BC and Alberta,
BA and Manitoba, etc.  Usually because when they moved to BC, they kept
their old registration.
Very few have taken the time to register themselves to deal in the US and
even then, they are limited to about 40 states that will recognize their
And it is serious.  About 13 years ago, a Vancouver Broker spent some
$5,000,000 Canadian defending themselves against the Nevada Securities
Commission because they were dealing with so many Canadians who were
vacationing in Arizona.  Yes, it is illegal for your Canadian Broker to deal
with you over the phone from Tulsa, or Miami, or Chicago or from Niagara
Falls New York when your Niagara Falls broker can look out his or her office
window and see you waving at them from the other side of the border.
I do not know how much you are talking about.
However, Sean Rickerby of TD Waterhouse has gone to the trouble of getting
himself licenced across the US.  Unfortunately, he only looks after
substantial accounts so if the amount you are talking about is $10,000 or
$20,000, he is not likely the person for you to deal with.
But, you can certainly phone him with your situation.  He has responded to
many of my readers in the past and I am happy to recommend him.  You can
find him at (604) 482-5188.
These previous Q & A's will give you a different perspective as well:
Sent: Sunday, October 16, 2005 7:01 PM
To: taxman at
Subject: RRSP & real estate
I am a Canadian citizen (now dual U.S.) also living in the U.S. for the past
six years (with my husband, also dual).
When I left Canada, I left a few RRSP accounts which I do not contribute to
and understand I cannot change as long as I am a non-resident of Canada.  My
hope is that eventually, tax laws will change and eventually I will be able
to make changes if I wish, while in the U.S.; or, by the time I retire, I
may be back in Canada; or may cash them in when I have no other source of
Meanwhile, I live here and contribute to an IRA.
My question ( a long shot):
Is there any provision for purchasing real estate in Canada with the RRSP
funds?  Keeping it as an investment for future retirement.  (There is a
rather complicated possibility to own a real estate IRA.)
Second question (another long shot):
My husband and I are trying to sell a piece of vacant land here in the U.S.
There is a tax provision where if we purchase another piece of real estate
within 90 days (or six months, I have to check the law), we can defer the
capital gains tax on the sale. Do you have any idea if this provision were
to apply if we sold a piece of land here and used the money to purchase a
piece of land in Canada?
Thank you.
david ingram replies:
1.    You can not use the RRSP funds to purchase real estate directly,.
However,  there are several mutual funds which own real estate.  You can buy
real estate mutual fund shares with your RRSP money.  Depending upon the
state you live in, the rules for non-residents dealing with their RRSP
accounts have eased a bit.  Shaun Rickerby of TD Waterhouse is a good person
to talk to about this as the repeated Q& A following # 2 suggests.
2.    You are talking about a section 1031 exchange.  This works if the
properties are in the same country. So you could sell a property in Canada
and buy another one in Canada under Section 1031 but you can not sell one in
the US and buy in Canada.  You could up to 1986 or so but they closed that
The following is the answer to a previous question.
Sent: Tuesday, October 04, 2005 11:29 AM
To: taxman at
Subject: non resident tax withholdings
I have an interesting situation, which I have been trying to resolve with no
success.  Perhaps you can give me an approach to try.
I am a Canadian citizen with RRSP and RESP holdings with the Royal Bank and
TD Waterhouse.  Some of my accounts include stocks, which occasionally pay
dividends.  These are reinvested.  I have noticed that Non Resident tax is
withheld on these accounts.
Now, I know that this should not be happening, as we have a tax treaty with
the US and the income in these accounts is not taxed in Canada until it is
withdrawn.  Effectively, this is double taxation, as I don’t receive a T5
for the income showing the tax withholding.
What to do, what to do?  I have enquired, but am being told by TD Waterhouse
that it is not their responsibility, the tax was withheld by the agent and
they have simply reported it.  My position is that they should be notifying
these agents that this is a non taxable account.
Can you suggest a way to get action?
david ingram replies:
Move your account!
This is a perennial problem which I see with RBC Dominion Securities the
most. The problem is that most securities people just do not care and even
if they did care it is too much trouble with no immediate cash reward.  Of
course, losing a big account should be incentive enough but lots of people
just cannot be bothered.  Now that i have said that, I have to confess that
I lost a very good account myself last year  where RBC was involved and the
RBC rep was extremely professional.  I had virtually ignored one client
(initials MC) at the time I was going through a divorce and was just not
responding myself in time.  (A good reason but not really an excuse - i did
not recognize that this particularly lady needed more hand holding and I
have never been a good hand holder.)
However, without a doubt, The best TD
Waterhouse person to talk to about a Canadian Account when you live in
the USA is Shaun Rickerby at (604) 482-5188.
I can tell you that without any hesitation, you should transfer your
Waterhouse account to his tender care.
His advice from the inside can help you deal with the Royal bank as well.
Shaun is one of about 12 Canadian Stockbrokers who has taken the trouble to
get himself licenced in most of the relevant US states.  He is a truly
unique individual who I recommend highly to any US resident with  Canadian
RRSP accounts and stock holdings.
I have been recommending Shaun for four years now and have never had a
complaint and likely received a dozen thank you calls.  I have never met
him, never had a cup of coffee with him and never received a commission,
spiff, etc until last Saturday when i used a couple of his BC Lion's tickets
to see the Lions play the Saskatchewan Roughriders.
It was a good game but in the absolute last minute of the game when the
roughriders scored an impossible touchdown, I twisted on the stairs and
managed to take a header on those cement hard stadium stairs and can still
hardly move --  So thanks Shaun, look after this lady if she calls.
On another note, it is amazing to see how Bobby Ackles has changed
Vancouver's attitude to the Lion's in three short years. He ha made them a
household name again with flags flying from cars, etc. Of course, his son
Scott has been a great marketing help as well.
Answers to this and other similar  questions can be obtained free on Air
every Sunday morning.
Every Sunday at 9:00 AM on 600AM in Vancouver, I, david ingram am a
permanent guest on Fred Snyder of Dundee Wealth Managers' LIVE talk show
Those outside of the Lower Mainland will be able to listen on the internet
Call (604) 280-0600 to have your question answered.  BC listeners can also
call 1-866-778-0600.
Callers to the show and questioners on this board can also attend the
Thursday Night seminars on finance and making your Canadian Mortgage
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