Author Topic: IBKR - Interactive Brokers  (Read 171654 times)

udravi

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Re: IBKR - Interactive Brokers
« Reply #480 on: November 06, 2018, 09:30:39 AM »
For exchange rates there is this app called Revolut that offers a multicurrency debit card with decent fx rates for individuals.


bizaro86

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Re: IBKR - Interactive Brokers
« Reply #481 on: November 07, 2018, 10:33:46 AM »
Part question part public service announcement for Canadians.

IBKR has moved its listing to the IEX. Now, generally speaking I don't care where a listing is. If that's cheaper and is a potential incentive for lower public market costs in general I'm all for it. However, there is a big catch for Canadians.

IEX is NOT a designated stock exchange by the Canadian department of finance. See the list here: https://www.fin.gc.ca/act/fim-imf/dse-bvd-eng.asp

That means (I think) that IBKR shares are no longer eligible to be held in a RRSP or TFSA account. That's bad news for me, as I have quite a few of them in my RRSP, and most of my existing non-registered investments are already things that can't go in an RRSP (mostly OTC stocks and directly held real estate).

Given this was previously traded on a registered exchange, is there a loophole that I can keep it? I don't want to sell IBKR, withdraw the shares from the RRSP (taxable!) or sell other assets to buy them back in non-registered form. I've emailed IEX to ask them to apply for registered status (and would encourage anyone else affected to do so as well)

KCLarkin

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Re: IBKR - Interactive Brokers
« Reply #482 on: November 07, 2018, 10:57:51 AM »
Given this was previously traded on a registered exchange, is there a loophole that I can keep it? I don't want to sell IBKR, withdraw the shares from the RRSP (taxable!) or sell other assets to buy them back in non-registered form. I've emailed IEX to ask them to apply for registered status (and would encourage anyone else affected to do so as well)

Ugh. Fortunately, I moved my IBKR from my RRSP last year.

Unless IEX becomes a designated exchange before the end of the year, it seems like you need to sell. I don't see a loophole. There seems to be a Public Corporation loophole, if the company was a Canadian company.

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50% tax

1.72 If a registered plan acquires a non-qualified investment or an existing investment becomes non-qualified, the controlling individual of the plan is subject to a tax under section 207.04 equal to 50% of the fair market value of the property at the time it is acquired or becomes non-qualified. In the case of an RESP or RDSP with multiple subscribers or holders, each such person is jointly and severally, or solidarily, liable with each other to pay the tax. Individuals liable for the tax for any calendar year must file Form RC339, Individual Return for Certain Taxes for RRSPs or RRIFs, RESPs or RDSPs or Form RC243, Tax-Free Savings Account (TFSA) Return as applicable. The form, together with any balance due, must be submitted by no later than June 30 of the following year.

1.73 The 50% tax on non-qualified investments is refundable in certain circumstances. To qualify for the refund, the investment must be disposed of before the end of the calendar year after the year in which the tax arose (or such later time as is permitted by the Minister of National Revenue). However, no refund is available if it is reasonable to consider that the controlling individual knew or ought to have known that the investment was or would become non-qualified. The forms referred to in 1.72 explain how to claim the refund.

1.74 If a non-qualified investment becomes qualified while being held by a registered plan, subsection 207.01(6) deems the investment to have been disposed of and reacquired by the plan. This might happen when a delisted security is relisted. This ensures that a refund is available in this situation, provided the conditions described in 1.73 are met.

1.75 Subsection 207.06(2) gives the Minister authority to cancel or waive all or part of the 50% tax on non-qualified investments in appropriate circumstances, taking into account such factors as reasonable error. The forms referred to in 1.72 explain how to apply for this relief.

KCLarkin

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Re: IBKR - Interactive Brokers
« Reply #483 on: November 07, 2018, 11:09:10 AM »
Given this was previously traded on a registered exchange, is there a loophole that I can keep it?

Actually, is it possible it is listed on Frankfurt Stock Exchange? When I enter IBKR symbol, IB gives me two options: IEX or Frankfurt. If so, Frankfurt appears to be a designated stock exchange.

https://ca.finance.yahoo.com/quote/KY6.F?ql=1&p=KY6.F

« Last Edit: November 07, 2018, 11:14:40 AM by KCLarkin »

writser

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Re: IBKR - Interactive Brokers
« Reply #484 on: November 07, 2018, 11:22:40 AM »
Yeah, IB is listed on the "Boerse Frankfurt": http://en.boerse-frankfurt.de/stock/Interactive_Brokers_Group-share, which is a specialist venue (i.e. no open order books but market maker quotes only) of the Frankfurt Stock Exchange. I'd say that that is technically part of the Frankfurt Stock Exchange.
When you are dead, you do not know you are dead. It's only painful and difficult for others. The same applies when you are stupid.

bizaro86

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Re: IBKR - Interactive Brokers
« Reply #485 on: November 07, 2018, 11:43:43 AM »
IEX got back to me and said they are working on it already, but didn't provide a time line on when it would be done. (And it probably goes at government speed, so months/years vs milliseconds...)

Thanks for the suggestion on Frankfurt, that's very helpful.

I'm not hugely comfortable with any uncertainty here, as 50% of my IBKR position is a couple percent of my portfolio... However, the page writser linked to notes the ISIN as the same as the one I own, so I think this should be OK.

writser

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Re: IBKR - Interactive Brokers
« Reply #486 on: November 07, 2018, 11:47:56 AM »
It's definitely the same stock. Question is if the Canadian government is ok with you buying / holding the stock in the US on IEX when the designated listing is on a floor-trading segment of the Frankfurter Boerse.
When you are dead, you do not know you are dead. It's only painful and difficult for others. The same applies when you are stupid.

bizaro86

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Re: IBKR - Interactive Brokers
« Reply #487 on: November 07, 2018, 11:55:54 AM »
Thanks! I'm pretty sure any Frankfurt listing qualifies, as exchanges where only certain tiers are allowed (TSX Venture, Jamaica) have the allowed tiers in brackets in the list I linked above.


matts

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Re: IBKR - Interactive Brokers
« Reply #488 on: November 07, 2018, 12:09:42 PM »
You should be fine. Just have the Frankfurt info ready if the CRA ever calls. I've held an OTC stock in my RRSP (which is not allowed) for years and no one has ever raised an issue. Like you, I can point to the same ISIN being dual-listed on a qualifying exchange in Amsterdam. I had to buy the OTC version because my broker won't let me buy any stock outside NA.


Hielko

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Re: IBKR - Interactive Brokers
« Reply #489 on: November 07, 2018, 12:22:57 PM »
Thanks! I'm pretty sure any Frankfurt listing qualifies, as exchanges where only certain tiers are allowed (TSX Venture, Jamaica) have the allowed tiers in brackets in the list I linked above.
You think so? I'm not a Canadian, don't know anything about Canadian taxes, but would seem very logical to me that what counts is an official listing. Because you don't even have to go outside the US if you want to trade IBKR on something else than IEX itself. You can route your order to the NYSE, AMEX, BATS and a dozen other US exchanges/trading venues. Secondly, that would probably imply that you can just ignore the whole designated exchange rule, since especially in Frankfurt you can trade basically everything that is listed somewhere else in the world.