Avoiding the ‘silent enemy’ of foreign withholding tax in RRSPs

The Globe and Mail
February 2, 2026.

The drag on income from foreign withholding taxes is often not well understood, as the U.S.-Canada tax treaty exempts U.S. income, dividends and capital gains in an RRSP.

The rule is a strange tax quirk, says Diana Orlic, Senior Portfolio Manager at Richardson Wealth. “At first, it might seem like a non-issue, but the cost can add up over time.”

“We always try to find the strategies that make the most sense for clients that are the most tax efficient,” she says. “But at the end of the day, the decision does come down to what clients are comfortable with.”

Related articles

2026

How better prospecting can lead to stronger client relationships

July 6, 2026 - Advisors should be just as intentional about finding the right client as clients should be about finding the right advisor, writes…

2 minute read

2026

How to prevent multigenerational households from descending into financial resentment

June 18, 2026 - When planned well, multigenerational households can lower costs, support childcare and elder care, and save for education, a down payment, or…

2 minute read

2026

For business owners, choosing the right mix of salary and dividends is all about flexibility

June 16, 2026 - Andrew Feindel considers two tax-effective income sources alongside salary and dividends: capital gains within the corporation and non-registered investments.

2 minute read