# Over-taxation of U.S. sourced dividend income



## jrsaballa (Nov 22, 2015)

U.S. Tax: minimum 15%

Canada Federal Tax: 15-29%
Ontario Tax: 5-13%

This is all equaling up to a maximum tax rate of 57%!!!!!

Now I'm just going to remind investors about money they lost buying and selling their stocks, and USD conversion to CAD...

Feelings, thoughts?? opinions?


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## AltaRed (Jun 8, 2009)

It is not 57% because to the extent you have Canadian tax owing on a T1 General, you get a foreign tax credit for the US taxes already withheld. Hence total tax is 20-42% depending on MTR.

Presumably one would buy low and sell high, no? Where is the loss in that?

No foreign exchange commish needs to be paid IF one uses Norbert's Gambit on a Cdn interlisted stock to convert CAD to USD or vice versa. Search for threads on Norbert's Gambit.


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## jrsaballa (Nov 22, 2015)

lol nawwww

15% US taxation is unavoidable, 15% Canadian federal tax is unavoidable and 5% Ontario tax unavoidable 

so for me, at least by 2016 tax time, 35% in taxes


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## jrsaballa (Nov 22, 2015)

Buying low and selling high, what's the time frame

I need to make some dough


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## Davis (Nov 11, 2014)

jrsaballa said:


> lol nawwww
> 
> 15% US taxation is unavoidable, 15% Canadian federal tax is unavoidable and 5% Ontario tax unavoidable
> 
> so for me, at least by 2016 tax time, 35% in taxes


If you don't understand the Foreign Tax Credit, then maybe you should try. If you're not interested in learning about the Foreign Tax Credit, then investing in foreign stocks isn't for you. Here's how it works:

Earn US$100 dividends, pay US$15 tax. Report C$133 in dividend income, pay 15-19% federal tax and 5.05-20.53% Ontario tax (don't forget Ontario's surtaxes).

Then deduct from the tax owing a 15% Federal Foreign Tax Credit (i.e., C$20). That reduces the total tax that you pay, unless you want to ignore the Foreign Tax Credit and pay more tax.


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## humble_pie (Jun 7, 2009)

we should take heart. Never have we seen anyone correct himself on taxation so quickly. From 57% tax at 12h50 this pm, jrsaballa was down to 35% tax by 15h44.

by tomorrow he'll be down to the correct amount & everything will be perfect.


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## jrsaballa (Nov 22, 2015)

this is all horse manure

clearly you people are amateurs, please read properly

I said a maximum 57% and 35% to myself by next year, try reading

as for the foreign tax credit, we'll see i haven't tried it yet


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## Davis (Nov 11, 2014)

Jrsabella, if you don't want people to respond to your posts, keep abusing those who do. That is the most effective way to keep people from trying to answer your questions. I get that you are new to financial planning and don't know very much yet, so I commend you for wanting to learn. But dude, lighten up your tone or you'll find that you won't make many friends here. And that you won't get many people bothering to respond. people on CMF are generally trying to help.


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## humble_pie (Jun 7, 2009)

Davis said:


> Jrsabella, if you don't want ...



au contraire mon cher je crois bien q'il faut l'encourager

il est marrant, non?




jrsaballa said:


> this is all horse manure
> 
> clearly you people are amateurs


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## Joe Black (Aug 3, 2015)

jrsaballa said:


> clearly you people are amateurs, please read properly


This, from the one who brought us....


jrsaballa said:


> Tax Free Savings Account
> Can I really put my money in for a day and then take it out and not have to pay taxes on it?


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## jrsaballa (Nov 22, 2015)

I already answered that


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## Guban (Jul 5, 2011)

jrsaballa said:


> this is all horse manure
> 
> clearly you people are amateurs, please read properly


Why are you asking amateurs important questions like your tax matters?


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