Brookfield Property Partners L.P. BPY

Witholding Tax (Canadian TFSA)

[Ott1989]

Hi all,

Just a quick question, I held BPY.UN in the past in my TFSA brokerage account and was never charged a withholdong tax. I got back in  4 months ago and got taxed about 5.2% for the June 30, 2020 distribution. Does anyone have an explanation, TFSA is a tax free account, why have they deducted tax?

Thanks

[Bagofhammers]

Same happened on Jiune 30th. Shows simply as TAXES. WTF Im using RBC TFSA

[Capharnaum]

TFSA's aren't exempt of witholding tax, only RRSPs.

[MarcoPoloTor1]

you are correct. Canada has a tax treaty with most developed countries. Those treaties typically ensure that retirement vehicles such as an RRSP are not subject to withholding tax by other countries on foreign source income. However TFSAs are not recognized by other countries as retirement vehicles. Therefore unlike an RRSP any foreign withholding tax paid on accumulating income inside a TFSA is

[Ott1989]

I finally figured out what the problem was. According to RBC DI representative, My W-8 BEN was expired and this is why my witholding rate was high. Apparently, this form needs to be filled in and submitted electronically every 3 years. Thank you everyone for sharing your thoughts.

[SargeX]

That is very interesting and good work on following up on it and getting an answer. It's not that often that SH does some good but this is sure one of those cases. BPY is actually quite a good board especially compared to many others that I follow. Now if we could only get rid of idiotic, useless posters like Snake, it would be a real beaut!! Ciao   Sarge  

[SargeX]

That is really weird as my BPY tax rate in my RBC DI TFSA is 0.148% ($0.64 on a distribution of $433.20). Are you sure your reading your numbers correclty?? There has always been a 15% withholding tax on foreign income in a TFSA and non-registered account but Brookfield has always tried to structure the dist to minimize it. Also, in a non-reg account you get it back when you do your taxes (can

[Ott1989]

Yes I checked it twice. My other Canadian dividend stocks did not get taxed. The tax was only for BPY.UN . I am not sure what is going on. I held BPY.UN in the past for a quite a while and never got taxed. It was held in the same RBC DI TFSA account. No idea what changed. Canadian stock dividend should not be taxed in a TFSA. The 15% witholding tax only applies to U.S stock. I would understand if

[dileas48s]

I don't know the entire answer, however BPY's dividend is paid in US Dollars, and I believe for tax purposes, is treated like a dividend straight from a US coporation like GE, or Chase Bank (for instance).  These dividends do have a special tax attached to them.  This is different from say BNS, where some of their revenue is indeed generated in the US, but their dividend is paid

[born2trade]

I checked my account and noticed  that the withholding tax was neglibile - it is 0.15% of the dividend received . To put it in perspective , $1.5 CAD was held as withholding tax for every $1000 in dividend I received.  Sarge also mentioned this  so if you see withholding tax in excess of this then I would suggest you check with your financial institutions.  15% withholding tax