# Transfer RRSP between discount brokerages



## james4beach (Nov 15, 2012)

Have any of you transferred RRSP (cash, not shares) between two discount brokerages, say from TDDI to iTrade?

I'm thinking of opening a new RRSP at iTrade, and moving 10k cash from TDDI to the new iTrade. I see in the fee schedule, TDDI charges $135 for "partial and full" transfers of registered accounts. I would later fund the account with more than 10k.

Do you think iTrade could reimburse this $135 that TD will charge? I haven't opened the iTrade account yet; should I dangle this in front of them? e.g. _"I'd like to open a new RRSP with you, and transfer 10k from TDDI, but they'll charge me $135 and that's the only thing holding me back... how can you help me out?"_

Suggestions? Will they not do this for such a small amount? I already have other iTrade accounts with over 50k, and am debating opening the RRSP.


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## Davis (Nov 11, 2014)

I consolidated accounts from TDDI, CIBC investor Edge and National Bank Direct Brokerage into Scotia iTrade. I got $500 per new account opened because of a special promotion (which they seem to offer regularly) plus reimbursement of the $135 transfer fee for each. It took ages (months), but eventually all of the money came through.


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## Beaver101 (Nov 14, 2011)

james4beach said:


> Have any of you transferred RRSP (cash, not shares) between two discount brokerages, say from TDDI to iTrade?
> 
> ...Suggestions? Will they not do this for such a small amount? I already have other iTrade accounts with over 50k, and am debating opening the RRSP.


 ... I have transferred RRSP + LIRA funds (cash and shares) between discount brokerages - BMOIL to CIBC IE. You should first figure out if iTrade would consider all your assets with them (ie. existing $50K + RRSP) so as to waive any annual fee for your "new" RRSP account given the $10K amount only you're transferring (at first). If not, then it would be worthwhile for the transfer and ask them to "waive" the $135 RRSP assets transfer fee - most discount brokerages would be inclined to do so given the "new" business going to them. Keep in mind the $135 transfer fee is for each transfer so you might want to consider moving all the RRSP funds over. Good luck.


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## HaroldCrump (Jun 10, 2009)

james4beach said:


> Do you think iTrade could reimburse this $135 that TD will charge?


iTrade (and most other brokerages) will reimburse you the transfer out fee charged by the other brokerage, within limits though.
They have flexibility is deciding if and how much to reimburse.

$135 sounds high...usually it is $50 or so.

But, depending on the size of the account you are going to open with iTrade, they could reimburse the entire amount.
You just need to ask.
Worst case, they might reimburse you partially, say $50.



> Will they not do this for such a small amount? I already have other iTrade accounts with over 50k, and am debating opening the RRSP.


They will consider your entire book of business with them, therefore, the other $50K+ accounts will help.


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## Eclectic12 (Oct 20, 2010)

HaroldCrump said:


> $135 sounds high [for transfer out fees] ... usually it is $50 or so.


Scotia iTrade's "Account transfer out (full or partial) fee is $150 per transfer so I guess high is relative.
http://www.scotiabank.com/itrade/en/0,,3694,00.html

I seem to recall most of the banks brokerage arms being between $100 to $150.



Cheers


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## HaroldCrump (Jun 10, 2009)

My information is outdated, then.
The last time I transferred anything was a TFSA from PC Financial to Scotia iTrade, and they had charged $50, which iTrade refunded.

Note that (in my case at least), the refund was into a non reg. account, and not into the TFSA because they said it will count as a contribution.


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## Eclectic12 (Oct 20, 2010)

Or maybe it's a function of the TFSA account having lower fees?
I notice that Tangerine on their TFSA page has the note:


> TFSAs have no fees while you’re saving with us. If at some point you decide to transfer your funds to another financial institution, a $45 fee will apply.



Unless there was a timing issue or an unused account would be subject to fee charges ... I'm not sure why cash wouldn't have been recorded as a TFSA withdrawal in say mid-December to late-December, followed by a Jan re-contribution. This way there's no overhead of negotiating with little time in a taxable position.

Or for that matter, since a fee was involved, why it wouldn't be recorded as a transfer which would not affect TFSA contribution room. (Or maybe that rep was off base?)


Cheers


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## HaroldCrump (Jun 10, 2009)

Eclectic12 said:


> I'm not sure why cash wouldn't have been recorded as a TFSA withdrawal in say mid-December to late-December, followed by a Jan re-contribution


Because I did the transfer mid-year.
If treated as a withdrawal, I would not have been able to re-contribute the same amount that year.



> Or for that matter, since a fee was involved, why it wouldn't be recorded as a transfer which would not affect TFSA contribution room. (Or maybe that rep was off base?)


It was indeed a transfer.
The issue is that the relinquishing institution will transfer the current value _after_ deducting the fee.
Therefore, the fee is _not_ a withdrawal but a part of your current value.

I am not sure how the refund works for registered accounts once the transfer arrives at the receiving institution.
Per the rep, if they apply the refund directly into the account, it could count as a contribution.
He suggested not to take a chance and go with a cash deposit into a non reg. account.


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## james4beach (Nov 15, 2012)

Thanks for the replies. They already told me there would be no annual fee on the RRSP (even if the balance is only $10k) because they will consider my other iTrade accounts (the $50k).

Beaver101 points out those large fees are per transfer, so maybe I should not bother with any transfer until there's a large amount to transfer in.

In any case, I want to open the iTrade RRSP and have new contributions I'll add immediately... I was just debating with myself whether to bother transferring in the additional 10k from TD


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## Beaver101 (Nov 14, 2011)

HaroldCrump said:


> ...
> I am not sure how the refund works for registered accounts once the transfer arrives at the receiving institution.
> Per the rep, if they apply the refund directly into the account, it could count as a contribution.
> He suggested not to take a chance and go with a cash deposit into a non reg. account.


 ... mine's was a partial transfer between RRSPs ... fee charged against existing/originating (From) RRSP and fee rebated with the new destinated account (To). However, not sure how the fee would be charged against the (From) RRSP account if it's completely closed out but I'm sure the bank will find a way to charge you the fee - ie. from your existing chequing account or non-registered account?


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## HaroldCrump (Jun 10, 2009)

Beaver101 said:


> However, not sure how the fee would be charged against the (From) RRSP account if it's completely closed out but I'm sure the bank will find a way to charge you the fee - ie. from your existing chequing account or non-registered account?


Was it an in-kind transfer or an in-cash transfer?
For an in-cash transfer, they will simply deduct the fee before transferring out.
For an in-kind, I am not sure.
If there is a cash balance, they can take from there, but if entire assets are in securities, I am not sure.
Presumably, they could call the account holder and ask him/her which security they can partially sell to recover the fee.


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## Eclectic12 (Oct 20, 2010)

HaroldCrump said:


> Because I did the transfer mid-year. ... It was indeed a transfer.
> 
> The issue is that the relinquishing institution will transfer the current value _after_ deducting the fee.
> Therefore, the fee is _not_ a withdrawal but a part of your current value.


Okay ... I get it now ... all but the withdrawal fee transferred without affecting the TFSA contribution room. The iTrade rebate had to wait as it would have been a contribution.


It makes one recall the days of "do you want the fee taken from a taxable account or the registered account?" with nostalgia. :biggrin:


Cheers


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## Eclectic12 (Oct 20, 2010)

james4beach said:


> ... In any case, I want to open the iTrade RRSP and have new contributions I'll add immediately... I was just debating with myself whether to bother transferring in the additional 10k from TD


Most transfers I've read about are where one is transferring everything so that one has leverage to get all the transfer fees back.

Otherwise, there's less incentive for the receiving institution to rebate the transfer fee. I'm sure some who negotiate well have been able to make it happen but I expect there's not a lot.


Cheers


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## Beaver101 (Nov 14, 2011)

HaroldCrump said:


> Was it an in-kind transfer or an in-cash transfer?
> For an in-cash transfer, they will simply deduct the fee before transferring out.
> For an in-kind, I am not sure.
> If there is a cash balance, they can take from there, but if entire assets are in securities, I am not sure.
> Presumably, they could call the account holder and ask him/her which security they can partially sell to recover the fee.


 .... partial in-kind transfer of both securities and cash with some cash left in the originating account to cover the bank's transfer fee. If there is no cash left, then it would make sense for the bank to sell (not sure if they would call even) a security to cover the transfer fee - the whole transfer process took 2 weeks+ so there's more than enough time for the bank not to loose out on their transfer fee.


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## humble_pie (Jun 7, 2009)

afaik an institution transferring out doesn't sell securities to collect its transfer fee in cases where insufficient cash is on hand.

they just bill the other broker.

presumably the transferring network - the CDS system - has a flagging mechanism to alert the uptaking broker about the pending bill & to seek approval for the same before an account is actually transmitted.

me i feel this business of buying new clients by offering free quotes & free transfers as rewards has gotten out of hand.

there must be squadrons of back office administrators at every broker stickhandling all the incoming & departing accounts, not to speak of all those bills & transfer fees.

these back office squadrons do cost $$ to maintain, so the fairly high commish that we do pay goes partly to subsidize the back office boiler rooms, tch ...

(aside to james) question numero uno: what is there that's so attractive at scotia over td? you won't be able to gambit currencies online, in fact currency gambits might be even more difficult at scotia than they already are at the big green.

i mean, if i were in your place i'd probably go to bmo or roybank for the fast, cheap, online currency gambits.

Q numero due: why not fund the RRSP at TD first, then transfer this larger account to scotia - if you insist upon scotia - when it will be big enough to earn the transfer fee, no dangling required.


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## james4beach (Nov 15, 2012)

Eclectic12 said:


> Most transfers I've read about are where one is transferring everything so that one has leverage to get all the transfer fees back. Otherwise, there's less incentive for the receiving institution to rebate the transfer fee.


Good point, I might not be able to get much for a small transfer like that. I'll probably just leave that 10k at TD and maintain that RRSP, since I never intended to close the TD one.

humble: you asked why I'm interested in iTrade. I already have a substantial banking relationship with scotia, so that's a big part of it. I don't do gambits too frequently. My primary interest with iTrade comes from my fixed income investing. I've now compared bonds between TD and iTrade for several years, and iTrade almost always has better pricing. Their interface for bond trading is also superior, and the clear separation of fees is very nice & honest.

Perhaps more import... iTrade just announced online purchases of GICs. I'm on the web site right now, and it's got a simple screening tool and I see 29 issuers (!!). How about a 5 year GIC @ 2.40% from CDIC-insured Concentra Financial (co-op)? You can do it all online now.


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## humble_pie (Jun 7, 2009)

james4beach said:


> ... why I'm interested in iTrade ... My primary interest with iTrade comes from my fixed income investing



that sounds good. Best of luck with the FI campaign.

hint: among your scotia accounts, you could also open up a canadian $$ short account. Then, since you're one who gambits from USD to CAD, you could try a Scrappy Reverse Gambit, which requires only 2 fast, cheap, easy online commissions.

i've described how a SRG works, but if you missed the post i'll be happy to run over it again. I do believe it would work very well at scotia.


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## james4beach (Nov 15, 2012)

Hi humble. I will try the Scrappy Reverse Gambit (SRG) in December, but on TDDI. That's still where my employment income flows in.

Check you check that I have the right steps? In my case, going from USD to CAD

1. Buy shares of RY/etc. Account: US margin, Market: US... standard USD purchase
2. Sell RY shares. Account: US (same), Market: Canadian
3. Accept the warnings and place the trade
4. Call TDDI the same day before market close
5. Ask the rep to CFO (change former order) my *sell* order, from the US to Canadian margin account

Very interested to try this!

Another question about that. I can see that the sell trade will sell TSX:RY and give me proceeds in CAD into my CAD account. But after this procedure, am I not still long RY in the US account and short RY in the Canadian account?

Step 1 leaves me long RY in the US account
Step 2+5 leaves me short RY in the Canadian account


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## humble_pie (Jun 7, 2009)

i'll doublecheck with my source.

there may be one more step, a final journal. It would be to journal long RY from US account to cover short RY in CAD account. I'll get back to you.


EDIT: this is where Scrappy gets its name. It might not be possible to journal until the purchase has settled in USD account. With a dividend-paying stock such as RY being used as the carrier stock, it would be important to make sure that stock would not be going X during these T+3 days.

RY looks good in december, though. It went X last week, will not go X again until january 2016.


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## james4beach (Nov 15, 2012)

Sounds like an adventure  But do brokers comfortably journal those kinds of things, or do they demand some kind of fee to do so? I like the idea of creating the condition that basically then requires them to clean it up with a journal


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## P_I (Dec 2, 2011)

While the OP might know this, for completeness sake, when transferring an RRSP between institutions, always complete CRA's T2033 - Direct Transfer to request the transfer from the original institution to maintain the proper tax status of the funds.


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## james4beach (Nov 15, 2012)

iTrade told me today that if I transfer in 15K, they would waive some transfer fees. Doesn't sound bad to me.

humble_pie: following up on yesterday's info on the (slightly off-topic SRG at TDDI). Do you know if that "final journal" can be done for free, or do they want fees to do that?


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## humble_pie (Jun 7, 2009)

james4beach said:


> iTrade told me today that if I transfer in 15K, they would waive some transfer fees. Doesn't sound bad to me.
> 
> humble_pie: following up on yesterday's info on the (slightly off-topic SRG at TDDI). Do you know if that "final journal" can be done for free, or do they want fees to do that?




afaik the big green has never charged to journal stock from one currency side of an account to the other currency side.

turning now to your earlier question, yes indeed the final step in the strategy would be to request a journal of the RY shaes from USD account, where they were bought, to CAD account, where they were sold.

i imagine this request can be lodged during the same phone call where the gambit trader asks the broker to CFO the order from one currency to the opposite. Don't worry if the actual journal transfer has to wait for settlement. What's important is that buy stock, sell stock & CFO stock all be completed on one day.


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## ashin1 (Mar 22, 2014)

when i transferred my discount brokerage between bmo investor line to cibc investor edge, i aksed them to transfer the funds "in kind" and i didn't have to pay for anything...


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## Beaver101 (Nov 14, 2011)

ashin1 said:


> when i transferred my discount brokerage between bmo investor line to cibc investor edge, *i aksed them to transfer the funds "in kind" and i didn't have to pay for anything*...


 ... that process seems magical. :wink:


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## james4beach (Nov 15, 2012)

humble_pie: thanks! I think I have a grasp of this procedure now, and I'll make sure I request the CFO on the same day.


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## james4beach (Nov 15, 2012)

james4beach said:


> iTrade told me today that if I transfer in 15K, they would waive some transfer fees. Doesn't sound bad to me.


A couple of other questions about the RRSP transfer from brokerage-to-brokerage.

Does this kind of transfer have any tax consequence? I'm hoping not, since it's kept as an RRSP. I'd be moving cash, not securities.

Also how fast do cash transfers usually happen? I had a bad experience many years ago when I moved my RRSP from RBC Mutual Funds to TD Waterhouse. It was a _cash_ transfer, but it took months -- seemingly, RBC delayed the procedure.


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## yyz (Aug 11, 2013)

There's no tax consequence if doing a transfer. With only cash involved it shouldn't take long unless someone drags their feet.


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## camerono (Mar 5, 2016)

yyz said:


> There's no tax consequence if doing a transfer. With only cash involved it shouldn't take long unless someone drags their feet.


Ditto. A friend did it recently with no issues. I am considering transferring my RRSP from GWL to Questrade.


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## james4beach (Nov 15, 2012)

Thanks!


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## Eclectic12 (Oct 20, 2010)

james4beach said:


> A couple of other questions about the RRSP transfer from brokerage-to-brokerage.
> 
> Does this kind of transfer have any tax consequence? I'm hoping not, since it's kept as an RRSP. I'd be moving cash, not securities.


I believe post #21 covered it. 

As long as the transfer is registered properly as a transfer instead of a withdrawal/re-contribution (regardless of asset type), there is no tax consequences. 

Some in the early days of the TFSA got caught as they didn't confirm the paperwork where the financial institution recorded it as a withdrawal. Trouble was there wasn't enough room to absorb the funds going into the receiving institution.


Cheers


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## james4beach (Nov 15, 2012)

P_I said:


> While the OP might know this, for completeness sake, when transferring an RRSP between institutions, always complete CRA's T2033 - Direct Transfer to request the transfer from the original institution to maintain the proper tax status of the funds.


Hmm... I had not seen this before. The receiving institution (iTrade) has their own form that they want me to fill out.

Does using iTrade's RRSP transfer form accomplish the same thing? Or would I fill iTrade's form and then also T2033, and send both to iTrade?


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## Spudd (Oct 11, 2011)

I don't think you need the T2033. When I moved my RRSP in the past I just filled out a form for the receiving bank, no T-forms were involved. Presumably the bank completes the T-form and submits it on your behalf.


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## Eclectic12 (Oct 20, 2010)

james4beach said:


> Hmm... I had not seen this before. The receiving institution (iTrade) has their own form that they want me to fill out.
> 
> Does using iTrade's RRSP transfer form accomplish the same thing? Or would I fill iTrade's form and then also T2033, and send both to iTrade?


I believe it does ... I can't recall what paperwork it was to transfer but the key is that to keep it from being a withdrawal is that there had better be paperwork.

Or maybe Spudd's idea that the bank fills the T form on your behalf is right.


Cheers


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## james4beach (Nov 15, 2012)

It will be interesting to see how fast this happens. I dropped the transfer form at a local Scotiabank branch on March 31 and now (a week later), got an email informing me that the transfer has started.


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## Eclectic12 (Oct 20, 2010)

Yes it will ... I can recall an association of investment dealers complaining it was taking too long.

My transfer was from bank to subsidiary broker and it took longer than I expected, which matches the association complaint.


Cheers


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## james4beach (Nov 15, 2012)

I'll report back here. Earlier I did a transfer (cash only) from RBC Mutual Funds to TD Waterhouse and it took months!


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## donna9 (Apr 9, 2016)

I've transferred an RRSP some time way back and although there is usually a fee to do so (usually steep) it does not include the deregistration fee (at least for me it didnt).


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## james4beach (Nov 15, 2012)

Whoa what's a deregistration fee? I'm transferring, not withdrawing RRSP


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## yyz (Aug 11, 2013)

The only fee you will encounter as mentioned before is a transfer fee.


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## Eclectic12 (Oct 20, 2010)

donna9 said:


> I've transferred an RRSP some time way back and although there is usually a fee to do so (usually steep) it does not include the deregistration fee (at least for me it didnt).


Deregistration fee sounds like it was a withdrawal or collapsing of the RRSP. As I understand it, james4beach is transferring from one RRSP to another. A transfer fee is all that I have seen reported for this type of transfer.

The RRSP transfer I did was from the bank to the bank's discount broker so that there was no transfer fee. Others have posted that where it was enough $$ and with negotiating the fee before the transfer with the receiving financial institution, at times they will be happy to refund it into a taxable account as they see it as worth it to be getting business from a competitor.


Cheers


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## james4beach (Nov 15, 2012)

james4beach said:


> It will be interesting to see how fast this happens. I dropped the transfer form at a local Scotiabank branch on March 31 and now (a week later), got an email informing me that the transfer has started.


Today, April 22, the cash transfer is complete and available in my RRSP (from TDDI to iTrade)

That's not bad. That's 22 days to transfer it, or 15 business days. Much faster than my last experience doing an RRSP transfer.


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