Taxes question wrt VT and transferring large amount of cash from Canada

Investing / Brokers
21

@boschika I am in a similar situation to you (B permit, taxed at source, previous Canadian resident). I asked my tax office about declaring dividends and they said that those being taxed at source should not complete a full tax filing. This essentially means that dividends are not taxed (in Switzerland) in our situations.

Where you may pay Swiss taxes on your Canadian investments is via wealth tax (starts at 50k CHF of personal wealth, 100k CHF for a couple). Pillar 2 and 3a holdings are not included in the taxable wealth total. How TFSA and RRSP should be treated is unclear. I would think that RRSP (which is tax-deferred) should not be included, but maybe the TFSA (which is post income tax)…

I suggest emailing your cantonal tax office about declaring dividends as there might be differences from canton to canton.

22

I’m not sure why you’ve been so condescending to me in this whole thread.

I didn’t try to play any tricks on any tax system and the investments I made are as run of the mill as it gets in the FI/RE community in Canada. There are more complex structures which I didn’t choose to use because they’re, well, more complex. I’m not sure why I’m having to defend myself to you but these investments are nothing fancy, any Joe Blow can buy them from their corner bank, and they’re fairly popular with Canadians.

3 Likes
23

That… contradicts what the CRA service for non-residents taxation specialist told me on the phone! And according to their online calculator, TFSA isn’t tax free. I really wish I could get an authoritative answer on the matter but every accountant I called in Canada told me they don’t deal with non-residents.

24

You may or may not be taxed in CH on these earnings, but the CRA specialist I had on the phone was very clear on the fact that the Canadian bank holding your investments is required to and will deduct 15% of your dividends and 25% of your sales. So while you may not be taxed in CH, you’ll still lose money to taxes if that’s true. The specialist’s logic was that you then get a paper for taxes paid, show it to your country of residence, and they apply it as a tax credit against your (Swiss) taxes due. But if you can’t fill a return and/or cannot have tax credits in CH then the amount is truly lost to you.

25

I have an RRSP and a TFSA and haven’t lived in Canada for 8 years. I have never seen my brokers apply tax on dividends or capitals gains. As long as nothing goes in or out of the account, I think you are fine.

26

Do they know you moved out of Canada? It’s not automatic and the CRA doesn’t necessarily tell them.

27

You know what… I should check into that.
But I am pretty damn sure that there is no withholding tax in TFSA and RRSP accounts. See the link from @San_Francisco above. Non-registered accounts are another story.

28

Hey @chca, did you find out?