Canadian Permanent Resident Investing in Indian Equities

[NiSn]

I moved from India to Canada as a PR in 2020. Back in India I used to invest in Indian equities through sharekhan Demat account. Since I am NRI now, they have blocked my account. Can any one tell the following

a) Mechanisms to invest in Indian Equities? Is Portfolio Investment Scheme the only route?
b) Which brokers in India allow to invest Canadian NRI's to invest in Indian Equities
c) Are any incomes from interest/capital gains in India (NRE or NRO account), taxable in Canada?
d) What is the tax in Canada on interest/capital gains income earned in India?

 

[@trigger]

a) Mechanisms to invest in Indian Equities? Is Portfolio Investment Scheme the only route? <You can invest in equity based Mutual Fund, starting point in NRE, NRO or FCNR accounts>
b) Which brokers in India allow to invest Canadian NRI's to invest in Indian Equities <All main stream MF house - few options>
c) Are any incomes from interest/capital gains in India (NRE or NRO account), taxable in Canada? <NRE - interest exempted in India, taxed in country of residence, NRO - taxed in India and again taxed in country of residence minus foriegn tax credits>
d) What is the tax in Canada on interest/capital gains income earned in India? <Marginal tax rate>

 

[NiSn]

a) Mechanisms to invest in Indian Equities? Is Portfolio Investment Scheme the only route? <You can invest in equity based Mutual Fund, starting point in NRE, NRO or FCNR accounts>
b) Which brokers in India allow to invest Canadian NRI's to invest in Indian Equities <All main stream MF house - few options>
c) Are any incomes from interest/capital gains in India (NRE or NRO account), taxable in Canada? <NRE - interest exempted in India, taxed in country of residence, NRO - taxed in India and again taxed in country of residence minus foriegn tax credits>
d) What is the tax in Canada on interest/capital gains income earned in India? <Marginal tax rate>

Thanks.
Specifically to NRO accounts, I estimate my 2020 income (Apr 2020 to Dec 2020 specifically) in NRO account will be reasonable. So do I first pay taxes in Canada on this income as part of return filing for year Jan-Dec 2020? Tax in India will only be paid after Mar 2021 ends (for financial year Apr 2020 to Mar 2021)

I have been in Canada since Jan 2020.

 

[@trigger]

Thanks.
Specifically to NRO accounts, I estimate my 2020 income (Apr 2020 to Dec 2020 specifically) in NRO account will be reasonable. So do I first pay taxes in Canada on this income as part of return filing for year Jan-Dec 2020? Tax in India will only be paid after Mar 2021 ends (for financial year Apr 2020 to Mar 2021)

I have been in Canada since Jan 2020.

Yes, there is no other option unless there is change in due dates. Canada return needs to be submitted before India one. Only if you expect a refund in Canada, there is no due date as such.

In any case all taxes (on global income Jan 20-Dec 20) need to be paid in Canada based on your residency status. If the India tax has already been paid for Jan 20-Mar 20, you can claim the FTC in Canada return.

 

[NiSn]

Yes, there is no other option unless there is change in due dates. Canada return needs to be submitted before India one. Only if you expect a refund in Canada, there is no due date as such.

In any case all taxes (on global income Jan 20-Dec 20) need to be paid in Canada based on your residency status. If the India tax has already been paid for Jan 20-Mar 20, you can claim the FTC in Canada return.

And if India taxes have not been paid in advance, does it mean I will end up paying taxes twice? First in Canada and then in India?

 

[@trigger]

And if India taxes have not been paid in advance, does it mean I will end up paying taxes twice? First in Canada and then in India?

No, either way you will pay once.

1. File India return => declare global income => pay tax on India income => file Canada return => declare global income => get foreign tax credits for taxes paid in India => pay rest of the taxes
2. File Canada return => declare global income => pay tax on global income => file India return => declare global income and paid taxes => no further taxes

These are generic guidelines to help you understand the taxation constructs between two countries with DTAA. You may engage tax accountant or lawyer if there is more complicated scenarios.

 

[NiSn]

No, either way you will pay once.

1. File India return => declare global income => pay tax on India income => file Canada return => declare global income => get foreign tax credits for taxes paid in India => pay rest of the taxes
2. File Canada return => declare global income => pay tax on global income => file India return => declare global income and paid taxes => no further taxes

These are generic guidelines to help you understand the taxation constructs between two countries with DTAA. You may engage tax accountant or lawyer if there is more complicated scenarios.

Thanks. Got it.

 

[adipdaniel]

Hi Guys

I have received PPR from India and am planning to travel to Canada sometime in July. I have an Indian demat account. Had few queries
1. Do i have to close my Indian demat account before I move to Canada?
2. I heard when converting Indian bank account from resident to nro before travelling we need to sell the shares in our demat account. Is that true? or when conversion happens we can transfer to nro demat without selling?
3. Once we move to Canada, can we continue trading in Indian securities via nro demat account?

Your replies are greatly appreciated!

 

[Siraj1189]

Hi Guys

I have received PPR from India and am planning to travel to Canada sometime in July. I have an Indian demat account. Had few queries
1. Do i have to close my Indian demat account before I move to Canada?
2. I heard when converting Indian bank account from resident to nro before travelling we need to sell the shares in our demat account. Is that true? or when conversion happens we can transfer to nro demat without selling?
3. Once we move to Canada, can we continue trading in Indian securities via nro demat account?

Your replies are greatly appreciated!

Same question bro..waiting for expert advice

 

[adipdaniel]

@TRIGGER @NiSn Please can you advise us