Money in Bank Account

[Beehivefive]

I am planning on coming back to Canada with my wife, who is a U.S. citizen and hopefully a future Canadian PR, and my daughter. We have substantial savings in our bank account. How do we transfer our money to Canada? Is there a fee or tax? Any way to do it easy and without paying out anything? I hate the idea of paying fees on money I've already paid taxes on, just to move it form one country to another.

Advice?

 

[mikeymyke]

Fees are unavoidable, just use Paypal.

 

[Beehivefive]

What do you mean? Use Paypal how? And do you know what the fees might be?

 

[Sweden]

here is what was posted once in the UK thread - so it applies to transfer UK/Canada, but I'm pretty sure you can do something similar with US/Canada.
Courtesy of mitchy6!

Ok the best way to send small amounts is Paypal. You set up a Paypal account (or may already have one) linked to your UK bank account and another separate Paypal account linked to your Canadian bank account. You simply then send money from one account to the other. This is by far the cheapest way to send money (fees are tiny like 0.1% - usually only a couple of dollars) and the FX rate will probably still be better than a bank. Even better you can literally have the money transferred in like 10 minutes if going Canada -> UK. If going UK -> Canada it's a bit slower (couple of days) because Canadian banks are SLOW! When you transfer from Canada to the UK the money is in your UK account instantly and it actually takes them a few days before it comes out of your Canadian account - so for 3 days you have double the money Wink! The Paypal rate is usually around the current spot rate plus or minus 0.04. So if the rate is 1.54 (as it is just now) you'll get around 1.58 going from Canada to the UK and around 1.50 going from the UK to Canada. Banks often have a much worse rate than this believe it or not. And then larger fees too on top of this!

For larger amounts your best option is to use a currency exchange company. They can get you as close to the spot rate as possible, usually within 0.02. The reason is that they basically have UK and Canadian bank accounts so if you were transferring Canada to UK you'd send it to their Canadian bank account and they send you the pounds from their UK bank account - they don't actually exchange the money at the transaction date, which is why they can offer better rates. They then store the money and exchange it when market conditions are at their most favourable. I used a company called Foreign Currency Solutions based in Glasgow - I was recommended them by a financial advisor in Scotland. A larger well known one is Oanda. If you have the time I'd pick out a few companies and ask them for their Canadian to UK (or vice versa) exchange rate. They will usually respond within 24 hours and then you can see which company is offering the best rate and go with them. The first time you use one you will have to send in a bunch of identification documents and stuff - this is standard practice due to money laundering regulations. So it will take a little bit longer to do the transfer first time.

I haven't done any calculations and this is completely an estimate. But I'd say if transferring more than $3,000 (CAD) going with a currency exchange company is best. Less than this Paypal. This is because a 0.02 spot rate saving on $3,000 = $60. But there are usually more fees in going this way - however $60 is probably enough to cover them, so I'd guess this is close to the break-even point. At $4,000 you're saving $80 (again, assuming you can get a 0.02 better rate), $5,000 you save $100 etc. These savings should more than cover the additional fees.

Good luck!
Sweden

 

[Beehivefive]

Great info. Thanks!

 

[Beehivefive]

By the way, I just realized in your wonderful info that you were referring to UK - Canada transfers. Would your advice still hold for U.S. - Canada transfers? I'm in the United States and going back to Canada. Thanks!

 

[Sweden]

I'm not sure, as I don't live in the US! but with a paypal account from Canada, you have the option to link to a US account and a Canada account, so if anything it should be even easier. Open a paypal account and see what they say about the fees etc. - it's worth investigating a little!

Sweden

 

[AnaMaria]

If you wire transfer, you financial institution will take care of the declaration. As you mention "substantial", ask your financial institution in the US for required document. Fees are unavoidable unless you bring cash and deposit it into your US$ account in Canada. If you bring money (more than $10,000) yourself, you have to declare at customs. This is due to anti-money laundering. No tax for bringing money. But if you don't declare, you may be charged for penalty if found.

PayPal is only good for small amount of money (and I doubt they will let you transfer large amount any way).

 

[herewecome]

If you wire transfer, you financial institution will take care of the declaration. As you mention "substantial", ask your financial institution in the US for required document. Fees are unavoidable unless you bring cash and deposit it into your US$ account in Canada. If you bring money (more than $10,000) yourself, you have to declare at customs. This is due to anti-money laundering. No tax for bringing money. But if you don't declare, you may be charged for penalty if found.

PayPal is only good for small amount of money (and I doubt they will let you transfer large amount any way).

This also applies to bonds and even a cheque!! I sent a cheque from UK to Canada with FedEx and they go via the US and my cheque for very close to $10k got held up for a week. So much for overnight.

I had to look into this as we are buying a house and are moving money from UK to Canada.

Personally I wouldn't use PayPal, they can freeze an account and funds at any time and if you're moving $xxx,xxx money through that will happen. Also the fx rate they always offer me onscreen is way out - like 2%. Over $300k say that's $6k.

Brokers. These are oanda etc. When I got quotes they were 2% off spot and that was picking say 7 points throughout a day over a week. I even spoke to one of their traders about the rates and they couldn't improve them. The fx rates they have on their website are different to the fx rates available to trade.

Banks. Some banks have bad rates, some better. Some have fees. Because a number of brokers have gone bust and my bank offered better rates AND there was better safety for my funds, this is how I have been transferring in multiple transactions to even out the fx rate.


I found the best for me was to look at all avenues and work out what you would ultimately end up in your bank account, what was the risk, how long was the money gone for, and then make a decision. I have a big spreadsheet and monitor trends etc so I can ring up and get the transfer done.

Use xe.com or fx street for live rates.