Forum Topics Transferring DRS (Direct Registration System) shares held in Canada to brokerage account
edgescape
Added 2 months ago

Long story short

I have some shares in a gold mining co listed on the TSX (Toronto Stock exchange) held in a DRS (Direct Registration System) that was given to me from a asset sale (divestment) by a mining company listed on the ASX years back.

My understanding is that the shares would be a capital return so can claim capital gains / losses when I sell.

But the ATO has ruled these shares is not a capital return but a special dividend.

So now I need to find a way to get the shares sold to cover the tax liability after doing the amendment for that year.

My only option is to transfer to one of the international brokers

Anyone had the unfortunate experience of dealing with DRS? Which brokers should I pick?

I've been told RBC and TD securities in Canada charge $300 for transfer which is damn expensive given the shares have gone down in value (and they've done nothing since)

Currently I'm looking at Interactive Brokers but they do request that there is $200 in your account just in case there are issues.

I'm thinking of filing an appeal to the ATO. given the holding value has fallen. But not sure about the timeframe for doing this.

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reddogaustin
Added 2 months ago

I'm in a sorta similar boat.

We have shares in companies listed in canada and USoA. In the name of a corporate trustee for a family trust.

Our broker Wilsons, has been having trouble trying to get them transferred onto our brokerage account.

The Americans appear to be 20yrs behind in admin processes, and are confused with discrectionary trust and corporate trustee structures.

And don't start me on the dividends that keep coming by "check" is USD....

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edgescape
Added 2 months ago

I think IBKR seems the easiest way to go. But don't like the idea of posting cash in the account in case something unexpected happens with the transfer

This is a reminder never to get excited with a company that divests its assets to another company listed overseas in a no-frills stock exchange such as the TSX. Better to run for the hills

I'm also not sure why or how the ATO decides that issued stock is classed as a special dividend.


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edgescape
Added 2 months ago

Thinking out loud here

This dilemma with DRS has to be the best and most useful topic to learn in a finance course.

It's a pity we don't learn it.

I'm also confused again why the ATO treats a divestment of an gold exploration portfolio asset in Bendigo into shares from listing on the TSX as a special dividend.

For those of you that are curious, this is the tax ruling

Yep, it's Petratherm!

Hopefully I get the money back if they prove up a Tier One HMS discovery and subsequently get taken over by the majors. That's the end game.

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