From: atbowler@thinkage.ca   
      
   On 2015-05-06 12:09 AM, tatarewicz@gmail.com wrote:   
   > Seems like the best way to handle foreign income, particularly stocks,   
    > is to transfer it into TFSA; no need to report income or capital gains,   
   > avoid hassle of foreign tax credit.   
      
   The problem with this is that you pay the foreign tax,   
   but don't get the credit.   
   RRSP's however are a good place to hold most foreign stocks   
   generally (when there is a tax treaty), you do not pay any foreign   
   taxes.   
      
   This is especially the case for dual Canadian-US citizens   
   since the US will demand taxes on earnings inside a TFSA   
   (but not ans RRSP).   
      
   For the 2014 income tax year, I found filling out the foreign   
   reporting form (T1135) quite easy.  When all the holdings   
   are in a Canadian brokerage you only need a country by country   
   summary (in my case 2 lines), and the brokerage supplied   
   supplied all the information.   This was a big improvement   
   from the 2013 filing where the instructions were ambiguous at best,   
   and no one seemed be available to answer questions.   
   (Searching the web only turned up accountants asking about how to   
   fill it out.  In the past, I found the local tax office people   
   quite helpful in sorting stuff out.  Harper's cutbacks meant   
   the local tax office would no longer talk to the general public,   
   and the CRA phone lines are never available in tax season.)   
      
   Of course, it is still silly that investments held in Canadian   
   brokerages need to be reported at all.  CRA already has all that   
   information.  Worse, it is clear that they don't seriously   
   look at the form anyway.  A while back I was late filing   
   my return because of death in the family.  At the time I was   
   not worried because we are told repeatly there is not penalty   
   when a refund is due, and I knew I had a refund coming.  So   
   I filed a few weeks late and included the T1135.  It turned out   
   that the "no penalty" rule does not apply to being late with the   
   T1135.  A YEAR AND HALF later I was dinged with a fine for that   
   late filing; obviously, CRA just sat on the form for over   
   a year.   
      
   There is some reason for CRA to expect T1135 information   
   on foreign property held outside the country, but requiring   
   filings for stocks and bonds in Canadian brokerages is just   
   duplication that wastes time and money.   
      
   --- SoupGate-Win32 v1.05   
    * Origin: you cannot sedate... all the things you hate (1:229/2)