Can someone help me for the investment in canada prior to moving to KSA?
1. I have investment in Canadian and US stock market. Do I have to sell all my investment prior to moving to KSA if I wish to become a non-resident of Canada or Can I keep it and sell it at a later date, lets say after 2 to 5 years when I am in KSA? I am a Canadian Citizen.
2. If I can keep my investment, how can I can claim the capital loss or gain? Do I have to file canadian tax?
3. I am not willing to sell my investment in stocks as I have substantial loss that I am expecting to recover if my portfolio will work better down the road.
4. How about the RRSP investment in mutual funds and stock market? Do I have to sell all investment or can i keep it?
Hi Alter - I can only comment on point #4. When I was discussing this with my investment advisor he said that I can keep my RSP but I would not be able to contribute to it while being a non-resident. He also said that the wife's TFSA would need to be closed out. Also, if you have any RESP's for your kids (if applicable) you won't be able to contribute to those either. However, it is possible for grandparents to open up TFSA's for their grandchildren.
I can speculate on your other points but take as just that...speculation. I'd imagine your Canadian and US investments will be just fine. I have friends living here in Canada and investing in the Hong Kong and Tokyo exchange. I can't see how that'd be any different if you were living in Saudi Arabia. It could be even more beneficial really if you're living in a country that you don't need to pay taxes on your capital gains. However, you wouldn't be able to claim capital losses either.
If selling stock or withdrawing from an rsp you should be subjected to a non-resident withholding tax, 25% I believe.
As far as waiting for your stocks to turn around you may choose to sell at this time and take a capital loss, reducing your tax burden for the current year. Can then repurchase at the same price if you expect the stocks to increase in value.
As far as the tfsa, I intend to keep mine, just cannot contribute in any year when you are a non-resident. From the CRA:
If you become a non-resident of Canada, or are considered to be a non-resident for income tax purposes: ■ you will be allowed to keep your TFSA and you will not be taxed in Canada on any earnings in the account or on withdrawals from it; ■ no TFSA contribution room will accrue for any year throughout which you are a non-resident of Canada; and ■ any withdrawals made during the period that you were a non-resident will be added back to your TFSA contribution room in the following year, but will only be available if you re-establish your Canadian residency status for tax purposes.
This is information I have found on my own, find a knowledgeable accountant, savvy with non-resident issues for absolute advice.
Watch out for your US investments - when you become a non-resident in Canada you will no longer be covered by tax treaty. Withholding goes to 30% and the threshold for inheritance tax plummets to 60,000 (USD assets).
This is interesting. Can you clarify please? - I have majority investment in canadian stock but some in US stock through canadian broker. Do you mean that if my US investment is sold through my canadian investment account will be taxed at flat 30% for all capital gain? - Or 50% of capital gain is taxable income which will be deducted at 30%?
Sorry to leave you hanging - vacation. This is a tough subject - I am still trying to figure it out... Yes, you will need to be careful for most US listed stocks/bonds/funds - dividends and some types of interest will be taxed at a straight 30% (as a non-resident of Canada and no tax treaty with KSA) and they will count towards your US estate (as a non-resident it will be taxed at >60k). One big thing, is once you become an expat, getting any decent tax/investment advice is difficult -- as a non-res Canadian, living in KSA, with holdings in several different countries, your situation is a little out of their comfort zone.