Quote:
Originally Posted by Enoch Root
Withholding tax does provide another level of tax drag. If you want US stocks (and most people should), it's part of the deal. However, persuing a dividend strategy with US stocks does face a pretty significant headwind.
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Oh yeah, 15% is no joke. But you know how it is. In Canada we have some financials, energy and materials and that's pretty much it. You basically need to invest in the US (and have been giving away returns if you haven't for the past 6-7 years), so you take that haircut on the dividend and get that exposure.
And if you can locate these holdings in the RRSP, there's no withholding tax, so obviously it becomes even more attractive.