FAQs: How to Update Canadian Tax Withholding Information
What are the favorable and unfavorable tax withholding rates?
The tax rates vary depending on your account type:
Account type Unfavorable tax withholding rate Favorable tax withholding rate Individuals and non-individuals (i.e., trusts or corporations) 25% 15% Non-prototype 15% 0% Partnerships 25% 15%
Note: All partners must qualify for treaty rates in order for the partnership to obtain the favorable withholding rate.
How do I apply for the Canada Revenue Agency (CRA) exemption letter? Can I see a sample application?
You can visit the CRA website or call the CRA at 800-959-8281 for assistance. Unfortunately, we are unable to help you navigate the site or assist with applying for the exemption letter. If you need further assistance with the CRA website or Canadian tax withholding, please contact a tax advisor.
What if I didn't fill out the form?
If you were required to but did not fill out the form, we are required to withhold taxes on Canadian source income (e.g., dividends and interest) at the unfavorable rate. However, you can complete the form at any time to apply for the favorable tax rate.
What if I used the wrong form or filled out the form incorrectly?
We'll send you a letter indicating that the form you submitted was incorrect. If you receive a letter like this, please call us at 800-343-3548 so we can help ensure you complete the right form correctly.
What about other foreign countries that withhold taxes?
For other countries, foreign source tax is generally withheld from foreign source dividend and interest income. The withholding amount is based on the tax treaties between the foreign country and the United States. Relief at the source (i.e., the foreign country) is not typically available to Fidelity customers because our global custodian holds the securities in a single account.
For countries that offer relief at the source, additional information or documentation may be required from you depending upon the specific country requirements.
An outside vendor, GlobeTax, has been engaged for customers to complete tax reclaim documentation to obtain refunds of foreign taxes withheld that are subject to reclaim. There is a cost associated with the service that you pay when this vendor is engaged for reclaims. For more information, please see GlobeTaxLog In Required.
If you are a mutual fund investor, you may want to review information on foreign tax withheld on those specific mutual funds, which we make available each tax year. Please see Fidelity Mutual Fund Tax Information for details.