In an article in the newspaper Finance et Investissement addressing the tax risks of foreign diversification, Tax Partner Renée Gladu explains that it is possible to recover withholding taxes on investment income earned in the United States, for example. The withholding tax is 30% in principle, but under the Canada-United States Income Tax Convention, this rate is reduced to 15% for dividends.
“The tax withheld can be deducted from taxes paid in Canada.” Ms. Gladu indicates that this credit very often will be claimed on the investor’s federal income tax return. “For example, if a taxpayer earns between $43,953 and $87,902 at a federal marginal tax rate of 18.4%, he will therefore use his entire 15% federal credit,” Ms. Gladu points out.
To learn more about these tax issues, see the article: http://www.finance-investissement.com/nouvelles/industrie/risques-fiscaux-d-une-diversification-etrangere/a/60672/1
10 Jul 2015 | Written by :