Can I continue to invest in Canada if I am back living in Ireland?

jayjay2010 · 07-11-2018 4:03am #1

So I am in Toronto for the last few months and plan to come home to Ireland soon. I am doing a bit of trading with TD Bank through their Direct Investing platform.
When I go home to Ireland, will I be able to continue trading using this platform? Or are there any regulations/tax implications that will restrict me from doing so?
My colleague is from Bangladesh and he said in his home country it is forbidden to trade any currency other than his home country currency.
Just curious - Canadians seem much more clued in when it comes to investing, its a very common thing around here with people of all ages. Hoping to keep it up when I go home.

Peregrinus · 07-11-2018 4:56am

There's no legal or regulatory prohibition from the Irish end. The question is whether either Canadian law or TD Bank's own terms and concitions, or TD Bank's policies, prevent TD Bank from operating this account for a non-resident (of Canada). You can get an authoritative answer to the question by asking TD Bank.

Note that even if you can trade through TD Bank you may not want to. Your TD Bank account is presumably denominated in CAD, while the underlying investments are will (presumably) mostly not be. So your choice of the TD platform builds in a probably avoidable set of foreign exchange costs. You would avoid these by using an online broker who will operate an account in euros. It's a marginal enough issue, and TD Bank may have other attractions for you that make you willing to bear the additional FX costs, but if you do decide to bear them at least satisfy yourself that it's for a good reason.

joxer1988 · 07-11-2018 4:57am

jayjay2010 wrote: »

So I am in Toronto for the last few months and plan to come home to Ireland soon. I am doing a bit of trading with TD Bank through their Direct Investing platform.
When I go home to Ireland, will I be able to continue trading using this platform? Or are there any regulations/tax implications that will restrict me from doing so?
My colleague is from Bangladesh and he said in his home country it is forbidden to trade any currency other than his home country currency.
Just curious - Canadians seem much more clued in when it comes to investing, its a very common thing around here with people of all ages. Hoping to keep it up when I go home.

I don't believe so. You need to make sure you are tax compliant in your country of residence i.e. Ireland. Is it a TFSA/RRSP? If so, there's no tax implications for an Irish resident, until you w/d from your RRSP.

jayjay2010 · 07-11-2018 5:31am

joxer1988 wrote: »

jayjay2010 wrote: »

So I am in Toronto for the last few months and plan to come home to Ireland soon. I am doing a bit of trading with TD Bank through their Direct Investing platform.
When I go home to Ireland, will I be able to continue trading using this platform? Or are there any regulations/tax implications that will restrict me from doing so?
My colleague is from Bangladesh and he said in his home country it is forbidden to trade any currency other than his home country currency.
Just curious - Canadians seem much more clued in when it comes to investing, its a very common thing around here with people of all ages. Hoping to keep it up when I go home.

I don't believe so. You need to make sure you are tax compliant in your country of residence i.e. Ireland. Is it a TFSA/RRSP? If so, there's no tax implications for an Irish resident, until you w/d from your RRSP.

Its a TFSA. I am currently a Canadian tax resident in 2018 and will be in 2019. This should mean that I will have $11k of TFSA contribution room available. My thinking is that I could leave 11k in that TFSA and pay absolutely no tax until the year that I decide to cash out those investments, which could be a few years down the line. I don't know if the Canadian Government will force me to close down the TFSA if I leave the country/become non -resident.

Peregrinus · 07-11-2018 5:55am

A non-resident of Canada can open/hold a Canadian TFSA, but any contributions you make as a non-resident are subject to tax of 1% per month until they are withdrawn, which makes contributing as a non-resident a very bad idea. So if you intend to save/invest more after you leave Canada, a TFSA is not the way to do it.

However, what has already gone into your TFSA can stay there when you leave Canada, and will not be subject to Canadian taxes.

Obviously, Canadian law can't exempt you from Irish taxes on your income and gains. Joxer suggests that you'll have no tax implications in Ireland until you withdraw fund from your Canadian TFSA, but I'd like to see chapter and verse on this; I'm not sure that it's correct.

A TFSA is just an investment vehicle through which you make investments in assets like shares, bonds, whatever. I think the Irish revenue would look straight through your TFSA at the underlying investments. So if you use your TFSA to by shares in Company A, but later (when resident in Ireland) dispose of those shares and acquire shares in Company B instead, still within your TFSA, as far as the Irish revenue are concerned that's a disposal of shares in Company A, and if a gain accrues to you on disposal then you are liable to Irish CGT. Similarly any dividends you receive on shares held in your TFSA, even if the dividends remain in the TFSA, are taxable income in Ireland. The bottom line is that I don't think wrapping your investments in an investment vehicle which is tax-exempt in Canada is going to do anything to avoid tax liability in Ireland

I could be wrong about this. But it's a point you'd want to check before committing to hold on to your Canadian TFSA as an Irish resident.

joxer1988 · 07-11-2018 6:01am

Peregrinus wrote: »

A non-resident of Canada can open/hold a Canadian TFSA, but any contributions you make as a non-resident are subject to tax of 1% per month until they are withdrawn, which makes contributing as a non-resident a very bad idea. So if you intend to save/invest more after you leave Canada, a TFSA is not the way to do it.

However, what has already gone into your TFSA can stay there when you leave Canada, and will not be subject to Canadian taxes.

Obviously, Canadian law can't exempt you from Irish taxes on your income and gains. Joxer suggests that you'll have no tax implications in Ireland until you withdraw fund from your Canadian TFSA, but I'd like to see chapter and verse on this; I'm not sure that it's correct.

A TFSA is just an investment vehicle through which you make investments in assets like shares, bonds, whatever. I think the Irish revenue would look straight through your TFSA at the underlying investments. So if you use your TFSA to by shares in Company A, but later (when resident in Ireland) dispose of those shares and acquire shares in Company B instead, still within your TFSA, as far as the Irish revenue are concerned that's a disposal of shares in Company A, and if a gain accrues to you on disposal then you are liable to Irish CGT. Similarly any dividends you receive on shares held in your TFSA, even if the dividends remain in the TFSA, are taxable income in Ireland. The bottom line is that I don't think wrapping your investments in an investment vehicle which is tax-exempt in Canada is going to do anything to avoid tax liability in Ireland

I could be wrong about this. But it's a point you'd want to check before committing to hold on to your Canadian TFSA as an Irish resident.

This makes a lot of sense. I doubt Revenue would grant the same tax protection to a TFSA that Canada does.

Only way to be certain that you're compliant is to consult the Revenue.

jayjay2010 · 07-11-2018 2:14pm

Thanks for all the very informative replies.

One last thing: does ireland have anything comparable to the TFSA for investments?

The TFSA is amazing, it’s such a powerful tools for wealth to build over time.

Also where in Ireland would be the best place to look at investments? The usual banks or maybe firms like Fidelity? I’d like to do some research before I go home.

Peregrinus · 07-11-2018 2:20pm

Pension plans and PRSAs are the most effective vehicles for sheltering investment from tax available in Ireland.

joxer1988 · 08-11-2018 6:26pm

jayjay2010 wrote: »

Thanks for all the very informative replies.

One last thing: does ireland have anything comparable to the TFSA for investments?

The TFSA is amazing, it’s such a powerful tools for wealth to build over time.

Also where in Ireland would be the best place to look at investments? The usual banks or maybe firms like Fidelity? I’d like to do some research before I go home.

DeGiro has a discount brokerage - similar to Questrade in Canada. Good luck!

Can I continue to invest in Canada if I am back living in Ireland?

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