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Learning, Sharing, and Teaching => Taxes => Topic started by: Goldy on October 18, 2020, 07:56:39 AM

Title: US citizen selling a large amount of Canadian stock tax question.
Post by: Goldy on October 18, 2020, 07:56:39 AM

The company I work for has given me options that have appreciated significantly so I’ve started thinking about how to sell.  I’m a us citizen and the stock is on the tsx so if we assume proceeds of $1,000,000 cad do you guys know what my tax liability would look like?  I’m not sure how options work in terms of long term cap gains vs short term.

Title: Re: US citizen selling a large amount of Canadian stock tax question.
Post by: travel2020 on October 20, 2020, 12:10:56 AM

You may want to consult a tax accountant given  the large sums but IIRC from the days I used to have stock options as an employee, when you exercised the option, you paid ordinary income tax on the difference between the option strike price and the current value of the stock. If, after exercising the options, you decide to hang on the shares, you would need to pay tax as usual on any gains ie short term gains if < a year vs long term capital gains if > 1 year.

Title: Re: US citizen selling a large amount of Canadian stock tax question.
Post by: Goldy on October 22, 2020, 05:13:23 AM

Thanks Travel2020, that is what I suspected would happen.  I just wasn’t sure if because it was a Canadian stock that I would need to pay Canadian tax but I think that answer is no.